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Sulfur Dioxide Compliance of a Regulated Utility
Journal of Environmental Economics and Management (1997)
  • Don Fullerton, University of Texas at Austin
  • Shaun P. McDermott, Carnegie Mellon University
  • Jonathan P. Caulkins, Carnegie Mellon University
Electric utilities can reduce sulfur dioxide emissions through a variety of strategies, and the cost of abatement can be minimized using tradable permits as under the Clean Air Act Amendments of 1990. Previous theoretical work has analyzed effects of public utility commission regulations on a utility's choice between permits and a single continuous "abatement technology." Our numerical model considers discrete choices among three abatement technologies. Using illustrative parameters, we find that regulatory rules could more than double the cost of sulfur dioxide compliance. They can even make costs with allowance trading higher than costs with command and control regulation.
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Citation Information
Don Fullerton, Shaun P. McDermott and Jonathan P. Caulkins. "Sulfur Dioxide Compliance of a Regulated Utility" Journal of Environmental Economics and Management Vol. 34 (1997)
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