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A numerical model for cost effective mitigation of CO₂ in the EU with stochastic carbon sink

Gren, Ing-Marie and Munnich, Miriam and Carlsson, Mattias and Elofsson, Katarina (2009). A numerical model for cost effective mitigation of CO₂ in the EU with stochastic carbon sink. Uppsala: (NL, NJ) > Dept. of Economics, Sveriges lantbruksuniversitet. Working paper series / Swedish University of Agricultural Sciences, Department of Economics ; 2009:4
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Abstract

This paper presents a model for the analysis of the potential of carbon sinks in the EU Emissions Trading Scheme (ETS) under conditions of stochastic carbon sequestration by forest land. A partial equilibrium model is developed which takes into account both the ETS and national commitments. Chance constraint programming is used to analyze the role of stochastic carbon sinks for national and EU-wide costs as well as carbon allowance price. The results show that the inclusion of the carbon sink option can reduce costs by as much as 2/3, but the cost saving is dampened when higher reliability of targets achievement is required. When carbon sinks are included, some countries with large carbon sequestration in relation to carbon emissions can achieve their national commitments without any costly reductions in energy use. However, cost estimates are sensitive to changes in assumed parameter values, in particular to changes in given business-as-usual levels of the use of fossil fuel.

Authors/Creators:Gren, Ing-Marie and Munnich, Miriam and Carlsson, Mattias and Elofsson, Katarina
Title:A numerical model for cost effective mitigation of CO₂ in the EU with stochastic carbon sink
Series/Journal:Working paper series / Swedish University of Agricultural Sciences, Department of Economics (1401-4068)
Year of publishing :2009
Number:2009:4
Number of Pages:46
Place of Publication:Uppsala
Publisher:Dept. of Economics, Swedish University of Agricultural Sciences
ISSN:1401-4068
Language:English
Publication Type:Report
Refereed:No
Full Text Status:Public
Agris subject categories.:X Agricola extesions > X70 Economics and management
Subjects:(A) Swedish standard research categories 2011 > 5 Social Sciences > 502 Economics and Business > Economics
Keywords:Cost effectiveness, stochastic carbon sink, EU carbon dioxide mitigation
URN:NBN:urn:nbn:se:slu:epsilon-e-783
Permanent URL:
http://urn.kb.se/resolve?urn=urn:nbn:se:slu:epsilon-e-783
ID Code:9327
Department:(NL, NJ) > Dept. of Economics
Deposited By: Ing-Marie Gren
Deposited On:14 Dec 2012 09:43
Metadata Last Modified:02 Dec 2014 10:54

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