In this recent case the highest EU Court examines the dynamic cap (or PSR) system for NOx emissions trading introduced by the Netherlands from a state aid perspective and notably the selectivity criterion. In this appeal from a judgment by the General Court, the ECJ finds for the Commission on...

Several pollution control regimes, including climate change policies, allow polluters in one sector subject to an emissions cap to offset excessive emissions in that sector with pollution abatement in another sector. The government may often find it more costly to verify offset claims than to...

We suggest a model of supply and demand for tradable pollution permits based on the polluters' marginal abatement cost (MAC) curves. Assuming linear MAC curves, we derive their parameters based on the estimates of directional output distance functions due to Färe, Grosskopf, Noh and Weber...

The federal government now confronts considerable political pressure to add CO2 to the existing set of criteria air pollutants. As with current criteria pollutants, proposals call for control of CO2, assuming that the control of the each of the three criteria pollutants is separable from the...

This study estimates allowance price induced technological progress using directional output distance function for a panel data of 80 plants of US fossil fuelled electricity generating industry over the period 1995 to 2001. This application yields several important insights. First, we observe...

China has realized that for its own sake and from the international community’s perspective, it cannot afford to continue along the conventional path of encouraging economic growth at the expense of the environment. Accordingly, the country has placed ecological goals at the same level of...

This paper examines the effects of combining an international cap-and-trade scheme with national carbon taxes. We consider a two-country stochastic partial equilibrium model with log-normally distributed uncertainty. The situation is analogous to the situation where European countries impose...