cap-and-trade
How California could surpass $1 billion in cap-and-trade auction revenue by 2013
Last week I did a series of posts examining the amount and potential price ranges for allowances in California’s upcoming cap-and-trade auctions for greenhouse gas emissions (GHGs). Knowing the estimated auction clearing price plus the estimated number of allowances to be sold at auction tells us the estimated revenue from that auction. Several estimates of …
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CONTINUE READINGAllowance distribution in California’s cap-and-trade program (Part II: Industry)
Yesterday I developed a basic overview of the different categories of allowances in California’s GHG trading program. As promised, this post considers the number of allowances that California will freely give to specific industries. Why do we care about industry allowances? First, allowances have value and the Air Resources Board (CARB) has chosen to give …
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CONTINUE READINGAllowance distribution in California’s cap-and-trade program (Part I)
Yesterday, I described California’s GHG cap-and-trade auction and the likely constraints on the auction clearing price. Today I want to switch gears to the allowance distribution. As summarized in our recent paper on California’s auction revenue, once you know the number of allowances available at auction and the auction clearing price, you can estimate revenue. …
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CONTINUE READINGAuction prices in California’s cap-and-trade program
This week, the Emmett Center released a new paper on the potential legal constraints on revenue generated from California’s upcoming greenhouse gas (GHG) cap-and-trade auction. In that paper, we provide a general overview of the cap-and-trade auction mechanism and discuss the potential revenue raised. I would like to expand on that discussion in a series …
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CONTINUE READINGWill California’s cap-and-trade program get 85% of its reductions from offsets?
Will California’s greenhouse gas (GHG) cap-and-trade program meet 85% of its required reductions with offsets? That is the claim made in a complaint recently filed in a California Superior Court, seeking to throw out California’s offset regulations. (Citizens Climate Lobby v. CARB.) The complaint cites a NY Times article from 2011, in which someone from …
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CONTINUE READINGWill California’s Cap and Trade Program Stimulate Innovation?
Holly’s latest post about a new study showing that cap-and-trade programs have not led to technological innovation ends with a cautionary note that raises the key question about innovation and cap-and-trade programs to reduce greenhouse gas emissions: These results [showing no innovation] don’t mean that cap-and-trade has no role to play in policies directed at climate …
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CONTINUE READINGPollution markets haven’t stimulated innovation
One of the early claims in favor of a cap-and-trade approach to pollution control, as opposed to traditional command-and-control innovation, was that market incentives would better encourage innovation in pollution control techniques and technologies. On the other hand, legal scholars such as David Driesen have long contended that pollution markets can actually reduce innovation incentives. …
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CONTINUE READINGCan cap-and-trade break whaling gridlock?
In the current edition of Nature, researchers from UC Santa Barbara and Arizona State propose a market for whale harvest quotas (subscription required). Essentially, they would like to establish a kind of “cap-and-trade” system in permits to hunt whales. Their paper is getting a great deal of attention in the media, both in specialized outlets …
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CONTINUE READINGWhen Do Economic Incentives Modify Behavior?
The Journal of Economic Perpspectives ought to be on any environmental law professor’s reading list — or really, anyone interested in environmental policy. Thanks in no small part to the editorial wizardry of Managing Editor Timothy Taylor, it performs its mission — to “fill a gap between the general interest press and most other academic …
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CONTINUE READINGPoll Results on Cap and Trade
I thought people might be interested in the results of our poll of readers on cap-and-trade: California has just adopted a cap and trade system. All things considered, do you think that cap and trade is the best strategy for controlling greenhouse gases? No, a carbon tax would be better. 56% Yes, cap and trade …
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