Co2 Abatement and Fuel Mix in German Electric Power Generation — Is the “Ecological Electricity Tax†Ecologically Effective?

Harald Tauchmann

Energy & Environment, 2005, vol. 16, issue 2, 255-271

Abstract: This paper analyzes the effect of a potential carbon tax on inter-fuel substitution in the electric power sector in Germany. By analyzing firm level panel data (1980–1998), we show that the fuel mix as used by power plants is price inelastic. That means that differential fuel taxes, e.g. a carbon tax, will not induce inter-fuel substitution towards less carbon intensive fuels. This in turn means that the recent introduction in Germany of an electricity tax cannot be judged less effective than the hypothetical introduction of a carbon tax with respect to power related CO 2 emissions. It is likely, however, that in the course of the deregulation of the German power sector a carbon tax will become significantly more effective than an electricity tax.

Keywords: fuel mix; CO2 abatement; German ecological tax reform; ecological effectiveness (search for similar items in EconPapers)
Date: 2005
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
https://journals.sagepub.com/doi/10.1260/0958305053749561 (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:sae:engenv:v:16:y:2005:i:2:p:255-271

DOI: 10.1260/0958305053749561

Access Statistics for this article

More articles in Energy & Environment
Bibliographic data for series maintained by SAGE Publications ().