TY - UNPB

T1 - More gas, less coal, and less CO2? Unilateral CO2 reduction policy with more than one carbon energy source

AU - Daubanes, Julien Xavier

AU - Henriet, Fanny

AU - Schubert , Katheline

PY - 2017

Y1 - 2017

N2 - We examine an open economy’s strategy to reduce its carbon emissions by replacing its consumption of coal—very carbon intensive—with gas—less so. Unlike the standard analysis of carbon leakage, unilateral carbon-reduction policies with more than one carbon energy source may turn counter-productive, ultimately increasing world emissions. Thus, we establish testable conditions as to whether a governmental emission-reduction commitment warrants the exploitation of gas, and whether such a strategy increases global emissions. We also characterize the extent to which this unilateral policy makes the rest of the world’s emission commitments more difficult to meet. Finally, we apply our results to the case of the US.

AB - We examine an open economy’s strategy to reduce its carbon emissions by replacing its consumption of coal—very carbon intensive—with gas—less so. Unlike the standard analysis of carbon leakage, unilateral carbon-reduction policies with more than one carbon energy source may turn counter-productive, ultimately increasing world emissions. Thus, we establish testable conditions as to whether a governmental emission-reduction commitment warrants the exploitation of gas, and whether such a strategy increases global emissions. We also characterize the extent to which this unilateral policy makes the rest of the world’s emission commitments more difficult to meet. Finally, we apply our results to the case of the US.

M3 - Working paper

T3 - MIT CEEPR Working Paper

BT - More gas, less coal, and less CO2? Unilateral CO2 reduction policy with more than one carbon energy source

PB - Massachusetts Institute of Technology

ER -