|
As policy makers consider strategies to reduce greenhouse gas emissions, they need to understand the available options and the conditions under which these options become economically attractive. This paper explores the economics of carbon capture and sequestration technologies as applied to electric generating plants. The MIT Emissions Prediction and Policy Analysis (EPPA) model, a general equilibrium model of the world economy, is used to model two of the most promising carbon capture and sequestration (CCS) technologies. The CCS technologies are based on a natural gas combined cycle plant and an integrated coal gasification combined cycle plant. Additionally, the role of natural gas combined cycle plants without...
|
There are at least three motivations for government intervention in GHG mitigation: (1) inducing the private sector to reduce GHG emissions directly by setting a price on emissions, (2) increasing the amount of innovative activity in GHG mitigation technology development, and (3) educating the public regarding GHG-reducing investment opportunities, allowing consumers to make better private decisions. This paper discusses the pros and cons of policy instruments that might be used to respond to these motivations and makes recommendations for an appropriate mix of policy instruments over time given both economic and policital/instituional considerations.
|
|