Cutting Costs of Catching Carbon - Intertemporal Effects under Imperfect Climate Policy

Michael Hoel () and Svenn Jensen

No 3284, CESifo Working Paper Series from CESifo

Abstract: We use a two-period model to investigate intertemporal effects of cost reductions in climate change mitigation technologies for the power sector. With imperfect climate policies, cost reductions related to carbon capture and storage (CCS) may be more desirable than com-parable cost reductions related to renewable energy. The finding rests on the incentives fossil resource owners face. With regulations of emissions only in the future, cheaper renewables speed up extraction (the ‘green paradox’), whereas CCS cost reductions make fossil resources more attractive for future use and lead to postponement of extraction.

Keywords: climate change; exhaustible resources; carbon capture and storage; renewable energy; green paradox (search for similar items in EconPapers)
JEL-codes: Q30 Q42 Q54 (search for similar items in EconPapers)
Date: 2010
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9)

Downloads: (external link)
https://www.cesifo.org/DocDL/cesifo1_wp3284.pdf (application/pdf)

Related works:
Journal Article: Cutting costs of catching carbon—Intertemporal effects under imperfect climate policy (2012)
Working Paper: Cutting Costs of Catching Carbon - Intertemporal effects under imperfect climate policy (2010)
Working Paper: Cutting Costs of Catching Carbon. Intertemporal effects under imperfect climate policy (2010)
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:ces:ceswps:_3284

Access Statistics for this paper

More papers in CESifo Working Paper Series from CESifo Contact information at EDIRC.
Bibliographic data for series maintained by Klaus Wohlrabe ().