The Role of Environmental and Technology Policies in the Transition to a Low-Carbon Energy Industry

Abstract

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Abstract: In a dynamic general equilibrium model we study the interplay between gradual and structural change in the transition to a low-carbon energy industry. We focus on the welfare-theoretic consequences of diverging social and private rates of time preference and a time-to-build feature in capital accumulation. Both features are particularly important in the transformation of energy systems. We show that only a combination of environmental and technology policies can achieve a socially optimal transition. We thus provide a new reason for environmental regulation to be complemented by technology policy such as a non-distortionary investment subsidy. Terms of use: Documents in EconStor may

Optimal Control of Pollutants with Delayed Stock Accumulation

“…While Asea and Zak (1999), Bambi (2008) and Rustichini (1989) analyze growth models with one capital good, Benhabib and Rustichini (1991), Boucekkine et al (1997) and Boucekkine et al (2005) investigate cyclical behavior in vintage capital models. Heinzel and Winkler (2007) and Winkler (2008) analyze optimal structural change in the energy sector, assuming that power plants exhibit a time-to-build feature. A shared result across the second literature strand is that capital accumulation models with delays exhibit oscillatory optimal paths.…”