The impact of instrument choice on investment in abatement technologies: a case study of tax versus trade incentives for CCS and Biomass for electricity

There has been a wide discussion on the different properties between carbon taxes, cap-and-trade schemes and hybrid instruments such as cap-and-trade schemes with price floors and ceilings. There has been less discussion on the incentives to investment that each of these instruments may provide. We build a three-period model to investigate the incentives offered to a large firm with diversified abatement options from such instruments when facing a choice between investing in lowcarbon technologies with potential learning benefits. We parameterise our model for a system similar to the EUETS and for two sample technologies, biomass for electricity and coal with carbon capture and storage. For both technologies we find that cap-and-trade schemes generate greater mean returns to such an investment than taxes, but with a wider distribution. We find that introducing price floors increase such mean returns while reducing the distribution, while ceilings further reduce the distribution, but also the mean and thus the overall incentives they offer will depend on the risk preference of the firm and scale of investment in relation to overall compliance costs

Low Carbon Electricity Investment: The Limitations of Traditional Approaches and a Radical Alternative

Moving to a very low carbon electricity system is central to meeting the goals of UK energy policy, and indeed to the wider global challenge of tackling climate change. This will require massive investment in low carbon electricity sources. This working paper identifies four key difficulties with the current mainstream approach of relying on the impact of a carbon price in the present liberalised electricity market, supplemented with additional incentive mechanisms like renewable obligation certificates and feed-in tariffs. We then summarise alternate mechanisms and propose a new approach, aimed at harnessing the potential interest and capital of electricity consumers, large and small, directly in funding low carbon electricity investments, in the form of longterm ‘Green Power’ contracts that operate in a separate, differentiated contract market

Fractional-order operators: Boundary problems, heat equations

The first half of this work gives a survey of the fractional Laplacian (and related operators), its restricted Dirichlet realization on a bounded domain, and its nonhomogeneous local boundary conditions, as treated by pseudodifferential methods. The second half takes up the associated heat equation with homogeneous Dirichlet condition. Here we recall recently shown sharp results on interior regularity and on $L_p$-estimates up to the boundary, as well as recent H\"older estimates. This is supplied with new higher regularity estimates in $L_2$-spaces using a technique of Lions and Magenes, and higher $L_p$-regularity estimates (with arbitrarily high H\"older estimates in the time-parameter) based on a general result of Amann. Moreover, it is shown that an improvement to spatial $C^\infty$-regularity at the boundary is not in general possible.Comment: 29 pages, updated version, to appear in a Springer Proceedings in Mathematics and Statistics: "New Perspectives in Mathematical Analysis - Plenary Lectures, ISAAC 2017, Vaxjo Sweden

Energy Efficient Service Delivery in Clouds in Compliance with the Kyoto Protocol

Cloud computing is revolutionizing the ICT landscape by providing scalable and efficient computing resources on demand. The ICT industry - especially data centers, are responsible for considerable amounts of CO2 emissions and will very soon be faced with legislative restrictions, such as the Kyoto protocol, defining caps at different organizational levels (country, industry branch etc.) A lot has been done around energy efficient data centers, yet there is very little work done in defining flexible models considering CO2. In this paper we present a first attempt of modeling data centers in compliance with the Kyoto protocol. We discuss a novel approach for trading credits for emission reductions across data centers to comply with their constraints. CO2 caps can be integrated with Service Level Agreements and juxtaposed to other computing commodities (e.g. computational power, storage), setting a foundation for implementing next-generation schedulers and pricing models that support Kyoto-compliant CO2 trading schemes

Smeared heat-kernel coefficients on the ball and generalized cone

We consider smeared zeta functions and heat-kernel coefficients on the bounded, generalized cone in arbitrary dimensions. The specific case of a ball is analysed in detail and used to restrict the form of the heat-kernel coefficients $A_n$ on smooth manifolds with boundary. Supplemented by conformal transformation techniques, it is used to provide an effective scheme for the calculation of the $A_n$. As an application, the complete $A_{5/2}$ coefficient is given.Comment: 23 pages, JyTe

Global carbon mechanisms: emerging lessons and implications

The global carbon mechanisms have succeeded in channelling billions of Euros towards low-carbon investments in developing countries, but cannot deliver what is needed in the future without support including reforms and involvement of North America. The publication shows that the Clean Development Mechanism itself has triggered more than 4000 emission-reducing projects in developing countries and is likely to save up to 2 billion tonnes of emissions reductions by 2012. Other Mechanisms under the Kyoto Protocol, including emerging Green Investment Schemes, show great promise. But many of the gains are at peril, warns the publication, unless governments act to restore balance in the markets and learn the emerging lessons. The publication identifies and analyses three fundamental problems that must be tackled. An excess of supply over demand will mean low prices in the market without government action There must be reforms to improve the efficiency and environmental performance of the existing mechanisms The Global Carbon Mechanisms are and will continue to be a central pillar in the global response to climate change to 2020, but are not on their own sufficient. They need to be complemented by other action to support the required cuts in carbon emission

Spectral asymmetry of the massless Dirac operator on a 3-torus

Consider the massless Dirac operator on a 3-torus equipped with Euclidean metric and standard spin structure. It is known that the eigenvalues can be calculated explicitly: the spectrum is symmetric about zero and zero itself is a double eigenvalue. The aim of the paper is to develop a perturbation theory for the eigenvalue with smallest modulus with respect to perturbations of the metric. Here the application of perturbation techniques is hindered by the fact that eigenvalues of the massless Dirac operator have even multiplicity, which is a consequence of this operator commuting with the antilinear operator of charge conjugation (a peculiar feature of dimension 3). We derive an asymptotic formula for the eigenvalue with smallest modulus for arbitrary perturbations of the metric and present two particular families of Riemannian metrics for which the eigenvalue with smallest modulus can be evaluated explicitly. We also establish a relation between our asymptotic formula and the eta invariant

Ellipticity Conditions for the Lax Operator of the KP Equations

The Lax pseudo-differential operator plays a key role in studying the general set of KP equations, although it is normally treated in a formal way, without worrying about a complete characterization of its mathematical properties. The aim of the present paper is therefore to investigate the ellipticity condition. For this purpose, after a careful evaluation of the kernel with the associated symbol, the majorization ensuring ellipticity is studied in detail. This leads to non-trivial restrictions on the admissible set of potentials in the Lax operator. When their time evolution is also considered, the ellipticity conditions turn out to involve derivatives of the logarithm of the tau-function.Comment: 21 pages, plain Te

Policy, innovation and cost reduction in UK offshore wind

Offshore wind in the UK has been a remarkable green growth success story. The price of offshore wind is less than a third of what it was a decade ago (Figure 1). In UK conditions, it is now cost competitive with new fossil fuel generation1. Indeed, if electricity prices return to pre-Covid levels, the Government would no longer be subsidising new offshore wind; HM Treasury will be earning revenue instead2. In parallel, the industry has grown and matured to a point where oil and gas companies are clamouring to enter the market and pension funds are comfortable in investing billions of pounds into construction