Impacts of the fairly priced REDD-based Co 2 offset options on the electricity producers and consumers

Krasovskii Andrey Andreyevich, Khabarov Nikolay Vasil'evich and Obersteiner Michael
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Krasovskii Andrey Andreyevich: International Institute for Applied Systems Analysis (IIASA)
Khabarov Nikolay Vasil'evich: International Institute for Applied Systems Analysis (IIASA)
Obersteiner Michael: International Institute for Applied Systems Analysis (IIASA)

Экономика региона, 2014, issue 3, 273-288

Abstract: This paper deals with the modeling of two sectors of a regional economy: electricity and forestry. We show that CO 2 price will impact not only the profits of the CO 2 emitting electricity producer (decrease), but also the electricity prices for the consumer (increase), and, hence, some financial instruments might be implemented today in order to be prepared for the uncertain CO 2 prices in the future. We elaborate financial instrument based on the Reduced Emissions from Deforestation and Degradation (REDD+) mechanism. We model optimal behavior of forest owner and electricity producer under uncertainty and determine equilibrium fair prices of REDD-based-options.

Keywords: REDD+ (search for similar items in EconPapers)
Date: 2014
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Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:scn:015306:15659864

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