Designing a Market for Tradable Emissions Permits

The economics literature shows that tradable emissions permits have important theoretical advantages over source-specific technical standards as a means for controlling pollution. But efficient, competitive markets in emissions may also be difficult to implement: transactions may be few with high negotiation costs; the market may be highly concentrated. Simple workable versions of the market concept may fail to take account of important complexities in the relationship between the pattern of emissions and the geographical distribution of pollution. This paper examines the feasibility of tradable permits, given these potential problems. Although the empirical part of the paper deals with a specific case—particulate sulfates in the Los Angeles airshed—the methods developed for investigating these issues have general applicability. Moreover, the particular market design that is proposed—an auction process that involves no net revenue collection by the state—has attractive features as a general model

Tradable Air Pollution Permits in the Overall Regulatory System: Problems of Regulatory Interactions

Because many environmental problems are associated with the production and use of energy, it is not surprising that the effects of policies in the two areas are often interdependent. This paper explores the interactions between the feasibility of an efficient market for emissions permits for sulfur oxides and the current state of air pollution, public utility and natural gas regulation. It shows how some of the opposition to tradable emissions permits can be traced to proposals to implement the reforms that redistribute wealth and the burden of regulatory uncertainty in ways that have greater economic impact than the potential efficiency gains of a market approach. It also examines how a tradable permits market and other regulatory reforms can be designed so as to avoid most of these problems

Barriers to Implementing Tradable Air Pollution Permits: Problems of Regulatory Interactions

Since 1977, the Environmental Protection Agency (EPA) has been developing and implementing an increasingly comprehensive system of controlled trading options for air pollution control. These programs introduce a limited market for the allocation of emissions among sources of air pollution. Starting with existing source-specific standards as a baseline, policies such as bubbles, emissions banks, netting and offsets allow firms to negotiate - within limits - trades of emissions permits in a manner that satisfies air quality standards at lower total costs. These trades, once agreed upon by the parties, in most cases must then be proposed to regulators as amendments to the existing set of source-specific standards

The three-dimensional Event-Driven Graphics Environment (3D-EDGE)

Stanford Telecom developed the Three-Dimensional Event-Driven Graphics Environment (3D-EDGE) for NASA GSFC's (GSFC) Communications Link Analysis and Simulation System (CLASS). 3D-EDGE consists of a library of object-oriented subroutines which allow engineers with little or no computer graphics experience to programmatically manipulate, render, animate, and access complex three-dimensional objects

Implementing tradable permits for sulfur oxides emissions : a case study in the South Coast Air Basin

Tradable emissions permits have important theoretical advantages over source-specific technical standards as a means for controlling pollution. Nonetheless, difficulties can arise in trying to implement an efficient, competitive market in emissions permits. Simple workable versions of the market concept may fail to achieve the competitive equilibrium, or to take account of important complexities in the relationship between the pattern of emissions and the geographical distribution of pollution. Existing regulatory law may severely limit the range of market opportunities that states can adopt. This report examines the feasibility of tradable permits for controlling particulate sulfates in the Los Angeles airshed. Although the empirical part of the paper deals with a specific case, the methods developed have general applicability. Moreover, the particular market design that is proposed -- an auction process that involves no net revenue collection by the state -- has attractive features as a general model

NASA Systems Analysis and Concepts Directorate Mission and Trade Study Analysis

Mission analysis, as practiced by the NASA Langley Research Center's Systems Analysis and Concepts Directorate (SACD), consists of activities used to define, assess, and evaluate a wide spectrum of aerospace systems for given requirements. The missions for these systems encompass a broad range from aviation to space exploration. The customer, who is usually another NASA organization or another government agency, often predefines the mission. Once a mission is defined, the goals and objectives that the system will need to meet are delineated and quantified. A number of alternative systems are then typically developed and assessed relative to these goals and objectives. This is done in order to determine the most favorable design approaches for further refinement. Trade studies are performed in order to understand the impact of a requirement on each system and to select among competing design options. Items varied in trade studies typically include: design variables or design constraints; technology and subsystem options; and operational approaches. The results of trade studies are often used to refine the mission and system requirements. SACD studies have been integral to the decision processes of many organizations for decades. Many recent examples of SACD mission and trade study analyses illustrate their excellence and influence. The SACD-led, Agency-wide effort to analyze a broad range of future human lunar exploration scenarios for NASA s Exploration Systems Mission Directorate (ESMD) and the Mars airplane design study in support of the Aerial Regional-scale Environment Survey of Mars (ARES) mission are two such examples. This paper describes SACD's mission and trade study analysis activities in general and presents the lunar exploration and Mars airplane studies as examples of type of work performed by the SACD

A Statement on the Appropriate Role for Research and Development in Climate Policy

This statement is issued by a group of economists and scientists which met at Stanford University on October 18, 2008 to discuss the role of research and development (R&D) in developing effective policies for addressing the adverse potential consequences of climate change. We believe that climate change is a serious issue that governments need to address. We also believe that research and development needs to be a central part of governments’ strategies for responding to this challenge. Solutions to manage long-term risks will require the development and global deployment of a range of technologies for energy supply and end-use, land-use, agriculture and adaptation that are not currently commercial. A key potential benefit of focused scientific and technological research and development investment is that it could dramatically reduce the cost of restricting greenhouse gas emissions by encouraging the development of more affordable, better performing technologies.