全球智库信息集成服务系统(G2TT): Optimal Management of Markets for Bankable Emission Permits

G2TT

来源类型	FEEM working papers "Note di lavoro" series
规范类型	论文
	Optimal Management of Markets for Bankable Emission Permits
	Jussi Lintunen; Olli-Pekka Kuusela
发表日期	2015
出处	Climate Change and Sustainable Development
出版年	2015
语种	英语
摘要	We examine the optimal management of emission permit markets when banking but not borrowing of permits is allowed. The regulator maximizes expected social welfare through an optimal allocation rule in an infinite horizon setting. The policy is second-best as the emission cap is set before the uncertainty about the current state of the economy is resolved. In this setting, the role of banking is to decrease the regulator’s risk as it generates an endogenous price floor in the permit markets. We show that the regulator’s optimal policy adjusts the emissions cap irrespective of the existing number of permits in the bank, with the implication that the regulator neutralizes the effect of the existing bank on future permit prices. We derive the optimality conditions for the second-best emission cap with banking and solve the model analytically in the case of IID shocks. Our results show that the discount factor together with the slopes of the marginal damages and benefits determine the welfare gains from allowing baking of permits. Finally, to address the current state of the EU Emission Trading Scheme (EU ETS) and guide the design of future permit markets, we solve the model numerically with persistent shock process and show that the optimal emission cap is positively correlated with business cycles, meaning that during downturns the regulator should tighten the cap. The expected emissions and permit prices also correlate positively with economic activity. *** Suggested citation: Lintunen, J., O.-P. Kuusela, (2015), 'Optimal Management of Markets for Bankable Emission Permits', Nota di Lavoro 48.2015, Milan, Italy: Fondazione Eni Enrico Mattei
特色分类	E32;Q54;Q58
关键词	Cap and Trade Climate Change Business Cycle Second Best Prices vs. Quantities
URL	https://www.feem.it/en/publications/feem-working-papers-note-di-lavoro-series/optimal-management-of-markets-for-bankable-emission-permits/
来源智库	Fondazione Eni Enrico Mattei (Italy)
资源类型	智库出版物
条目标识符	http://119.78.100.153/handle/2XGU8XDN/118402
推荐引用方式 GB/T 7714	Jussi Lintunen,Olli-Pekka Kuusela. Optimal Management of Markets for Bankable Emission Permits. 2015.

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20155261429461Nota_d（71KB）	智库出版物		限制开放	CC BY-NC-SA	浏览
20155261429554NDL201（1317KB）	智库出版物		限制开放	CC BY-NC-SA	浏览