Highlights We estimate the potential gains of carbon ETS for China’s transportation. The marginal abatement cost is derived by partial quantile order-α frontiers. Marginal abatement cost is around 1009$/tonne. The estimated potential gains of ETS range between 2 and 22 billion dollars.

    Abstract The transportation sector is under high pressure to reduce their carbon emissions. Emission trading is widely used as a market-oriented policy instrument to reduce emissions and increase social and economic benefits. The present study introduces a new model for estimating the potential gains of CO2 emission trading for China’s transportation sector by simulating a trading market. This hypothesized trading market considers both price information and underlying emission trading process. The marginal abatement cost of transport sector’s CO2 emission is derived by designing a constrained maximum likelihood model with partial quantile order-α frontiers. Results showed an average marginal abatement cost of CO2 emission for China’s transport sector at around 1009$/tonne. The estimated potential gains of emission trading measured in monetary terms range between 2 and 22 billion dollars, accounting for 0.5% of the total profit generated by the transportation sector.


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    Title :

    Potential gains of trading CO2 emissions in the Chinese transportation sector


    Contributors:


    Publication date :

    2020-01-01




    Type of media :

    Article (Journal)


    Type of material :

    Electronic Resource


    Language :

    English




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