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Author(s): Dotson, Greg | Abstract: Many aspects of carbon taxes have been studied in the academic literature. This paper focuses on an area that has received insufficient attention by examining some of the specific institutional challenges a carbon tax proposal would face in Congress. A relatively unknown recent debate in the House of Representatives over a resolution to denounce the concept of carbon taxes provides a window into these challenges, demonstrating the arguments and tactics that can impede solution-oriented action to address climate change. Developing a policy that responds to these arguments is likely to add complexity to a carbon tax proposal, to increase the number of congressional committees involved in consideration of the proposal, and to create additional demand for the revenue that a proposed carbon tax would generate. Moreover, opponents of a policy can exploit these complicating factors and the lengthy time needed in Congress to consider legislation, so they can preemptively attack emerging concepts and proposals. The paper concludes by arguing that enacting a carbon tax at the federal level, with the policy elements that are often contemplated, will require a great deal of agreement or complaisance among lawmakers. Understanding this challenge well in advance of the opportunity for congressional consideration of a carbon tax will best prepare carbon tax advocates for a successful outcome.

Author(s): Kunnas, Jan | Abstract: Book ReviewThis important book presents the results from a large project bringing together scholars from various institutions and across the disciplines in China and the United States to examine local and global air pollution in China.

Policymakers typically favor renewable fuel mandates over taxes and cap and trade programs to reduce greenhouse gas emissions from the transportation sector. Because of delays in the development of commercially viable renewable fuels and important constraints on their use and distribution, fuel mandates are susceptible to sudden increases in compliance costs as policies become more stringent. The authors study the effects and efficiency of two fuel mandates, a renewable share mandate and a carbon intensity standard, as well as the effects of two cost containment provisions, a credit window price and a renewable fuel multiplier. The authors show using a numerical model of the US fuel market that when the mandates are set optimally, they can lead to modest efficiency gains over business as usual; however, when combined optimally with a credit window price, the efficiency of both mandates increases substantially. In contrast, optimally combining a mandate with a renewable fuel multiplier that indirectly relaxes the standard results in only modest efficiency gains over the optimal mandates alone.View the NCST Project Webpage

This dissertation presents novel realizations in balancing the economical and environmental constraints in an energy intense world using: process network synthesis, energetic process enhancement concepts, carbon dioxide utilization and the deployment of renewable energy resources. Such balance is achieved through effective control and planning over resources and conditions. The mathematical optimization framework developed in this body of work can be found in chapters 1 and 2 while their applications are developed in chapters 3 and 4. Chapter 1, introduce for the first time the Infinite Dimensional State-Space (IDEAS) based synthesis of reactor networks featuring multiple residence time distribution (MRTD) models in chapter 1. IDEAS is shown to be applicable to the MRTD synthesis problem containing a combination of Plug Flow reactor (PFR), Continuous Stirred-Tank Reactor (CSTR) and Segregated Laminar Flow Reactor (SLFR). The formulation which synthesis reactor networks featuring multiple residence time distribution (MRTD) guarantees global optimality through IDEAS based properties. Case studies featuring the Trambouze reaction scheme are carried out using the different reactor combinations and multiple selectivity and economical constraints.Chapter 2, presents for the first time a design and synthesize framework for the minimum number of units reactor networks with multiple Residence time density functions of diffrent reactor types using the Infinite Dimensional State-Space (IDEAS) method. The works combines the usage of Plug Flow Reactor (PFR) and Continuous Stirred-Tank Reactor (CSTR) in constructing the reactor networks using an IDEAS based Mixed Integer Linear Programing (MILP) formulation. Case studies featuring the Trambouze reaction scheme are carried out based on multiple process specification. This work expands the real life application potential of the work presented in chapter 1.In chapter 3, the newly developed concept of process energetics is applied to Steam Methane Reforming (SMR) to overcome the highly endothermic load challenge. The resulting process termed Energetically Enhanced Steam Methane Reforming (EESMR) is a non combustion process which means that the process related GHG emissions will receive favorable treatment in national carbon pricing programs. Chapter 4 presents an energetically self-sufficient process with zero carbon dioxide emissions for the production of electricity and chemicals from natural gas. The choice of product can be made based on environmental and economical constraints explained within the chapter. Natural Gas Chemical Power System (NGCPS) provides flexibility of choice when it comes to producing electricity, formic acid and hydrogen. The work further covers the environmental impact of thermochemical cycles in power production.

Abstract Climate policy has mostly focused on regulating power suppliers. There is a growing interest in exploring regulating emissions from the demand side by incentivizing consumers to reduce their energy consumptions, or to purchase power from cleaner sources through tracking carbon content of power flow in the transmission network. This paper analyzes market outcomes under two approaches: producer-based and demand-based carbon taxes. We formulate each approach as a market equilibrium model. For the consumer-based approach, the analysis assumes that a utility, procuring electricity on behalf of consumers, is subject to the carbon tax. For the producer-based approach, the producers are subject to the carbon tax, and therefore, pay for their emissions. We show that the two approaches are equivalent when the program's coverage is complete. However, when the coverage is incomplete, the consumer-based carbon tax is less effective in pricing carbon emissions owing to the fact that sales to unregulated regions are not subject to the carbon tax. Given that the transaction cost of implementing consumer-based tax is likely to be high, benefit of tracking power flows in order to estimate carbon content or footprint might not be justified even with a full coverage program.

We model optimal policy when the probability of a tipping point, the welfare change due to a tipping point, and knowledge about a tipping point's trigger all depend on the policy path. Analytic results demonstrate how optimal policy depends on the ability to affect both the probability of a tipping point and also welfare in a post-threshold world. Simulations with a numerical climate-economy model show that possible tipping points in the climate system increase the optimal near-term carbon tax by up to 45% in base case speciffcations. The resulting policy paths lower peak warming by up to 0.5 C compared to a model without possible tipping points. Different types of tipping points have qualitatively different effects on policy, demonstrating the importance of explicitly modeling tipping points' effects on system dynamics. Aversion to ambiguity in the threshold's distribution can amplify or dampen the effect of tipping points on optimal policy, but in our numerical model, ambiguity aversionincreases the optimal carbon tax.

California’s low carbon fuel standard (LCFS) specifies that the state’s transportation fuel supply achieve a 20% reduction in carbon intensity (CI) below 2011 levels by 2030. Reaching the standard will require substantive changes in the fuel mix, but the specifics and the cost of these changes are uncertain. We assess if and how California is likely to achieve the standard, and the likely impact of infrastructure credits on this compliance outlook. We begin by projecting a distribution of fuel and vehicle miles demand under business-as-usual economic and policy variation and transform those projections into a distribution of LCFS net deficits for the entire period from 2019 through 2030. We then construct a variety of scenarios characterizing LCFS credit supply that consider different assumptions regarding input markets, technological adoption over the compliance period, and the efficacy of complementary policies. In our baseline scenario for credit generation, LCFS compliance would require that between 60% and 80% of the diesel pool be produced from biomass. Our baseline projections have the number of electric vehicles reaching 1.3 million by 2030, but if the number of electric vehicles reaches Governor Jerry Brown’s goal of 5 million by 2030, then LCFS compliance would require substantially less biomass-based diesel. Outside of rapid zero emission vehicle penetration, compliance in 2030 with the $200 credit price may be much more difficult. New mechanisms to allow firms to generate credits by building electric vehicle charging stations or hydrogen fueling stations have minor implications for overall compliance because the total quantity of infrastructure credits is restricted to be relatively small.

The era of publicly mandated GHG emissions restrictions in the United States has begun with recent legislation in California and seven northeastern states. Commercial and industrial buildings can improve the carbon-efficiency of end-use energy consumption by installing technologies such as on-site cogeneration of electricity and useful heat in combined heat and power systems, thermally-activated cooling, solar electric and thermal equipment, and energy storage -- collectively termed distributed energy resources (DER). This research examines a collection of buildings in California, the Northeast, and the southern United States to demonstrate the effects of regional characteristics such as the carbon intensity of central electricity grid, the climate-driven demand for space heating and cooling, and the availability of solar insolation. The results illustrate that the magnitude of a realistic carbon tax ($100/tC) is too small to incent significant carbon-reducing effects on economically optimal DER adoption. In large part, this is because cost reduction and carbon reduction objectives are roughly aligned, even in the absence of a carbon tax.

AbstractThis paper derives a method to quantify the impact of biofuels on fuel markets, assuming that these markets are dominated by a cartel of oil‐rich countries and that fuel prices in these countries are significantly lower than those in the rest of the world. We identify large differences between the effects of introducing biofuels using the proposed method (denoted the cartel‐of‐nations [CON] model), in contrast to the competitive or the standard cartel models. When compared with the CON model, the competitive model overestimates the reduction in fuel prices and underestimates the reduction in fuel consumption, and therefore the impact of biofuels on greenhouse gases.