Confronting the Carbon Pricing Gap: Second Best Climate Policy
In: Confernce on the Economics of Energy and Climate ; https://hal.inrae.fr/hal-03726396 ; Confernce on the Economics of Energy and Climate, Toulouse School of Economics, Jun 2022, 2022
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Ce travail a aussi été présenté à la conférence LORDE 2022 (Long-Run Dynamics in Economics), LERN Université de Rouen Normandie 30 mars - 1 avril 2022 ; International audience ; Confronted with political opposition to the implementation of efficient direct carbon pricing, climate policy relies on alternative policy interventions, such as subsidies to renewables. This paper uses a dynamic macroeconomic model under a carbon budget to study climate policies constrained to keeping a constant level of the carbon tax. We find that it is possible to implement the optimal trajectory by combing an increasing tax on electricity consumption with a feedin-premium paid to electricity produced from renewable sources. Otherwise, when the climate policy relies on the second instrument only, the subsidy to renewables should be so large to foster rapid build up of specialized capital, that it would imply large investment costs and financial burden on the public budget, unless the carbon tax level could be initially set at a high level. Unfortunately, the two solutions with no or low welfare losses raise concerns on their political acceptability too.
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Confronting the Carbon Pricing Gap: Second Best Climate Policy
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Autor/in / Beteiligte Person: | Pommeret, Aude ; Ricci, Francesco ; Schubert, Katheline ; Université Savoie Mont Blanc (USMB Université de Savoie Université de Chambéry ) ; Centre d'Economie de l'Environnement - Montpellier (CEE-M) ; Centre National de la Recherche Scientifique (CNRS)-Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement (INRAE)-Institut Agro Montpellier ; Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement (Institut Agro)-Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement (Institut Agro)-Université de Montpellier (UM) ; Paris School of Economics (PSE) ; Université Paris 1 Panthéon-Sorbonne (UP1)-École normale supérieure - Paris (ENS-PSL) ; Université Paris Sciences et Lettres (PSL)-Université Paris Sciences et Lettres (PSL)-École des hautes études en sciences sociales (EHESS)-École des Ponts ParisTech (ENPC)-Centre National de la Recherche Scientifique (CNRS)-Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement (INRAE) ; Toulouse School of Economics |
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Zeitschrift: | Confernce on the Economics of Energy and Climate ; https://hal.inrae.fr/hal-03726396 ; Confernce on the Economics of Energy and Climate, Toulouse School of Economics, Jun 2022, 2022 |
Veröffentlichung: | HAL CCSD, 2022 |
Medientyp: | Konferenz |
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