The Regional Greenhouse Gas Initiative and U.S. energy markets

详细信息   

• 作者：Lee ; Kangil
• 学历：Master
• 年：2014
• 关键词：Social sciences ; Applied sciences ; Emissions trading
• 导师：Kim,Man-Keun
• 毕业院校：Utah State University
• Department：Economics
• 专业：Environmental economics;Economics;Energy
• ISBN：9781321576405
• CBH：1584318
• Country：USA
• 语种：English
• FileSize：2750117
• Pages：65

文摘

There have been numerous studies in relation to carbon permit prices in the greenhouse gas (GHG) emissions trading market and energy markets. Most previous studies have focused on the European Union Emissions Trading Scheme (EU ETS) since its creation in 2005. Notable findings are 1) the carbon permit price in the EU ETS and energy prices are closely interrelated,and 2) crude oil and electricity prices are the main drivers of the carbon permit price. Our attention moves to another emissions trading market in the U.S.,the Regional Greenhouse Gas Initiative (RGGI),which began in 2009 for nine northeastern US states. The RGGI is the first regulatory carbon cap-and-trade system in the U.S. To my best knowledge,there is no rigorous empirical study about the RGGI. A primary research objective is to investigate a mutual relationship among the RGGI carbon permit price anKey findings designate that,unliked energy prices in the northeastern U.S. I have applied the Lag Augmented Vector Autoregression (LA-VAR) model to capture the mutual relationship among the RGGI,electricity,natural gas,and coal prices. Impulse response function (IRF) results suggest that an interrelation between the RGGI carbon permit price and electricity market exists,although it is weak and statistically insignificant. This implies that both markets are not closely attached. IRF also suggests that the natural gas price has positive impacts on the RGGI carbon permit price but the natural gas price is not influenced by the RGGI market. In addition,IRF tells us that the RGGI price and coal price are negatively related each other. Key findings designate that,unlike the EU ETS,the RGGI market and electricity market in the RGGI region are not tied closely,and the natural gas is the main driver of the system in the RGGI region. The loose relationship between the two markets can be explained by recent weak carbon credit demand,which stems from low GHG emissions. The recent low natural gas prices have led to increased fuel switching,which reduces GHG emissions as power companies switch from coal to natural gas sources.