Reflections and outlook for the New Zealand ETS: must uncertain times mean uncertain measures?

This article discusses the development and performance of New Zealand\u27s emissions trading scheme since the report of the Emissions Trading Scheme Review Panel in 2011. Introduction The New Zealand emissions trading scheme (ETS) was introduced by legislation in 2008. The legislated objectives as stated in section 3 of the Climate Change Response Act 2002 are to ‘support and encourage global efforts to reduce the emission of greenhouse gases by (i) assisting New Zealand to meet its international obligations under the [UNFCCC] Convention and the [Kyoto] Protocol; and (ii) reducing New Zealand’s net emissions of those gases to below business-as-usual levels’. Beyond this, the New Zealand government has confirmed three objectives for the ETS: help New Zealand to deliver its ‘fair share’ of international action to reduce emissions, including meeting any international obligations; deliver emission relations in the most cost-effective manner; support efforts to maximise the long-term resilience of the New Zealand economy at least cost. ........ This article discusses the development and performance of the scheme since the report of the Emissions Trading Scheme Review Panel in 2011. In particular, the article presents the results of a survey undertaken by the authors in April 2013 of stakeholders’ perception of the scheme and its performance. The survey was designed and administered by the authors using FluidSurveys software

Trusted UAV Network Coverage using Blockchain, Machine Learning and Auction Mechanisms

The UAV is emerging as one of the greatest technology developments for rapid network coverage provisioning at affordable cost. The aim of this paper is to outsource network coverage of a specific area according to a desired quality of service requirement and to enable various entities in the network to have intelligence to make autonomous decisions using blockchain and auction mechanisms. In this regard, by considering a multiple-UAV network where each UAV is associated to its own controlling operator, this paper addresses two major challenges: the selection of the UAV for the desired quality of network coverage and the development of a distributed and autonomous real-time monitoring framework for the enforcement of service level agreement (SLA). For a suitable UAV selection, we employ a reputation-based auction mechanism to model the interaction between the business agent who is interested in outsourcing the network coverage and the UAV operators serving in closeby areas. In addition, theoretical analysis is performed to show that the proposed auction mechanism attains a dominant strategy equilibrium. For the SLA enforcement and trust model, we propose a permissioned blockchain architecture considering Support Vector Machine (SVM) for real-time autonomous and distributed monitoring of UAV service. In particular, smart contract features of the blockchain are invoked for enforcing the SLA terms of payment and penalty, and for quantifying the UAV service reputation. Simulation results confirm the accuracy of theoretical analysis and efficacy of the proposed model

Assessment and challenges of carbon markets

Global warming, with its harmful effects, is one of the most crucial issues of the 21st century. States of the international community have responded to this challenge by resorting to an original instrument: tradable emissions permits for carbon and, as a direct consequence, the pollution rights markets. This article deals with the study of this hybrid instrument and is divided into three parts. The first part concerns the description and an assessment of the initial framework enshrined in the Kyoto Protocol (I). The second part provides an overview of the reactions triggered by the consecration of the approach put forward in the Protocol (II). On the basis of the various adopted measures, an outline of the alternative and feasible solutions will be drawn in the last section. In this regard, we will recommend an approach that would start from the carbon markets as they exist today but which would integrate them and coordinate the available social and institutional actors (civil society, NGOs, federated and local entities, etc.) through a mechanism of fungibility that would make the markets compatible with each other. From an operational point of view, this fungibility could occur by using new technologies such as blockchain (III)

KEY DETERMINANTS OF ACHIEVING TRUST IN APPLYING BLOCKCHAIN TO EMISSION TRADING IN FINLAND

A thesis presented on the critical moment of sustainability transition especially regarding reducing emission of carbon dioxide. The disruption of blockchain application has become one of the innovations that can facilitate this transition. This thesis research focuses on the investigating the most influential trust determinants of applying blockchain to emission trading system (ETS) in the context of Finland. This is exploratory qualitative research which combines grounded theory applied for eight empirical papers and three semi-structured expert interviews. The interviewees include two Finnish ETS experts and two blockchain application experts. Through the qualitative analysis, the author suggested structural assurance trust, knowledge-based familiarity trust and control-based trust to be the most deterministic trust factors in applying blockchain to emission trading. Meanwhile, situational normality trust, peer-based trust and ethnical trust can also be influential. A sequential model and a pyramid model of different trust factors mentioned have been proposed based on the interpretative findings of interviews. Therewith, a consolidated trust model was suggested involving all the relevant trust factors. Finally, the research results can be highly generalisable towards member countries of EU ETS other than Finland

Climate policies for road transport revisited (II): Closing the policy gap with cap-and-trade

Current policies in the road transport sector fail to deliver consistent and efficient incentives for greenhouse gas abatement (see companion article by Creutzig et al., 2010a). Market-based instruments such as cap-and-trade systems close this policy gap and are complementary to traditional policies which are required where specific market failures arise. Even in presence of strong existing non-market policies, cap-and-trade delivers additional abatement and efficiency by incentivizing demand side abatement options. This paper analyzes generic design options and economic impacts of including the European road transport sector to the EU ETS. The point of regulation in a road transport cap-and-trade system should be upstream in the fuel chain to ensure effectiveness (cover all life-cycle emissions and avoid double-counting), efficiency (incentivize all abatement options) and low transaction costs. Based on year 2020 marginal abatement cost curves from different models and current EU climate policy objectives we show that in contrast to conventional wisdom road transport inclusion would not change the EU ETS allowance price. This puts concerns over industrial carbon leakage as a consequence of adding road transport to the EU ETS into perspective.Climate Policy, Road Transport, Cap-and-trade

Instrument Choice in Environmental Policy

We examine the extent to which various environmental policy instruments meet major evaluation criteria, including cost-effectiveness, distributional equity, minimization of risk in the presence of uncertainty, and political feasibility. Instruments considered include emissions taxes, tradable emissions allowances, subsidies for emissions reductions, performance standards, technology mandates, and research and development subsidies. Several themes emerge. First, no single instrument is clearly superior along all the criteria. Second, significant trade-offs arise in the choice of instrument; for example, assuring a reasonable degree of distributional equity often will require a sacrifice of cost-effectiveness. Third, it is possible and sometimes desirable to design hybrid instruments that combine features of various instruments in their “pure” form. Fourth, for many pollution problems, more than one market failure may be involved, which may justify (on efficiency grounds, at least) employing more than one instrument. Finally, potential overlaps and undesirable interactions among environmental policy instruments are sometimes a matter of concern.emissions control instruments, cost-effectiveness, distributional burden, induced innovation

Pricing the Cloud: An Auction Approach

Cloud computing has changed the processing and service modes of information communication technology and has affected the transformation, upgrading and innovation of the IT-related industry systems. The rapid development of cloud computing in business practice has spawned a whole new field of interdisciplinary, providing opportunities and challenges for business management research. One of the critical factors impacting cloud computing is how to price cloud services. An appropriate pricing strategy has important practical means to stakeholders, especially to providers and customers. This study addressed and discussed research findings on cloud computing pricing strategies, such as fixed pricing, bidding pricing, and dynamic pricing. Another key factor for cloud computing is Quality of Service (QoS), such as availability, reliability, latency, security, throughput, capacity, scalability, elasticity, etc. Cloud providers seek to improve QoS to attract more potential customers; while, customers intend to find QoS matching services that do not exceed their budget constraints. Based on the existing study, a hybrid QoS-based pricing mechanism, which consists of subscription and dynamic auction design, is proposed and illustrated to cloud services. The results indicate that our hybrid pricing mechanism has potential to better allocate available cloud resources, aiming at increasing revenues for providers and reducing expenses for customers in practice