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Global Climate Change Digest
A Guide to Information on Greenhouse Gases and Ozone Depletion
Published July 1988 through June 1999

FROM VOLUME 6, NUMBER 4, APRIL 1993

PROFESSIONAL PUBLICATIONS...
CO₂ EMISSION REDUCTIONS: APPROACHES AND IMPACTS

Item #d93apr7

Editorial Review/Essay: Buying Greenhouse Insurance: The Costs of CO₂ Emission Limits (A.S. Manne, R.G. Richels, MIT Press, 1992), reviewed by W.R. Cline (Inst. Intl. Economics, 11 Dupont Cir. NW, Washington DC 20036), Clim. Change, 23(2), Feb. 1993.

Concludes that the book makes a major contribution by providing rigorous estimates of the economic costs of abatement, although they seem more likely to be overstated than understated. Approves of the "greenhouse insurance" concept advocated.

Item #d93apr8

"Opportunities and Constraints Posed by Fuel Poverty on Policies to Reduce the Greenhouse Effect in Britain," B. Boardman (St. Hildas Coll., Univ. Oxford, Oxford OX1 3TB, UK), Appl. Energy, 44(2), 185-195, 1993.

The poor spend twice as much on fuel, as a proportion of income, and are more likely than other families to be using electricity for heating. Carbon taxes would heavily penalize the poor. Awareness of these and other conflicts is needed so that sound environmental policies do not increase the deprivation of the poorest families.

Item #d93apr9

"The EC Proposal for Combining Carbon and Energy Taxes: The Implications for Future CO₂ Emissions," A.S. Manne (Operations Res., Stanford Univ., Stanford, Calif.), R.G. Richels, Energy Policy, 21(1), 5-12, Jan. 1993.

Evaluates the EC proposal for the USA as well as for Western European countries, using the Global 2100 model. The proposal is unlikely to achieve its long-term targets for emission reduction, and hinders reductions by imposing a tax on nuclear energy.

Item #d93apr10

"The Oil Market and International Agreements on CO₂ Emissions," K. Berger (Central Bureau Statistics, Oslo, Norway), O. Fimreite et al., Resour. & Energy, 14(4), 315-336, Dec. 1992.

Analyzes the differing effects on fossil fuel prices of two possible forms of CO₂ emission agreements: tradable emission permits and an international CO₂ tax. Because of the imperfect competition that exists in the fossil fuel markets, the former approach implies higher producer prices and a larger efficiency loss than does a CO₂ tax giving the same total emissions. An illustration based on the oil market shows that the two approaches yield considerably different producer prices.

Item #d93apr11

"Curbing CO₂ Emissions by Axing EC Coal Subsidies," B.E. Okogu (Econ. & Finance, OPEC, Obere Danaustr. 93, 1020 Vienna, Austria), F. Birol, OPEC Bull., 23(10), 7-12, Nov.-Dec. 1992.

Coal is the most polluting of all fossil fuels, yet the proposed EC carbon/energy tax would favor coal relative to oil and gas. This analysis, using basic econometric techniques, shows that eliminating the market distortions of coal subsidies would reduce carbon emissions significantly.

Item #d93apr12

Two items from J. Energy Eng. (ASCE), 118(2), Aug. 1992:

"California's Tradeable Emissions Policy and Greenhouse Gas Control," J.P. Dwyer (Sch. Law, Univ. Calif., Berkeley CA 94720), 59-76. Experience with California's existing tradable market scheme for conventional air pollutants illustrates some of the practical difficulties facing this approach to regulating greenhouse emissions. In addition to the need for effective monitoring and enforcement, there are institutional problems, and industrial firms tend to withhold emission credits from the market. A half-hearted approach to market-based regulation virtually guarantees failure.

"Equity and International Agreements for CO₂ Containment," D. Burtraw (Resour. for the Future, 1616 P St. NW, Washington DC 20036), M.A. Toman, 122-135. Discusses some basic concepts regarding equity and burden-sharing. Examines the consequences of different a priori sharing rules or "focal points" for greenhouse gas negotiations, finding the case for them to be limited. Offers instead a synthesis of focal point equity theory and strategic bargaining theory, and examines the question of linking CO₂ agreements to other international policy issues.