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Book
Sulfur dioxide control by electric utilities : what are the gains from trade?
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Year: 1998 Publisher: Washington, DC : World Bank, Development Research Group, Environment and Infrastructure,

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Climate Change and Trade Policy : From Mutual Destruction To Mutual Support
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Year: 2010 Publisher: Washington, D.C., The World Bank,

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Contrary to what is still often believed, the climate and trade communities have a lot in common: a common problem (a global "public good"), common foes (vested interests using protection for slowing down climate change policies), and common friends (firms delivering goods, services, and equipment that are both cleaner and cheaper). They have thus many reasons to buttress each other. The climate community would enormously benefit from adopting the principle of "national treatment," which would legitimize and discipline the use of carbon border tax adjustment and the principle of "most-favored nation," which would ban carbon tariffs. The main effect of this would be to fuel a dual world economy of clean countries trading between themselves and dirty countries trading between themselves at a great cost for climate change. And the trade community would enormously benefit from a climate community capable of designing instruments that would support the adjustment efforts to be made by carbon-intensive firms much better than instruments such as antidumping or safeguards, which have proved to be ineffective and perverse. That said, implementing these principles will be difficult. The paper focuses on two key problems. First, the way carbon border taxes are defined has a huge impact on the joint outcome from climate change, trade, and development perspectives. Second, the multilateral climate change regime could easily become too complex to be manageable. Focusing on carbon-intensive sectors and building "clusters" of production processes considered as having "like carbon-intensity" are the two main ways for keeping the regime manageable. Developing them in a multilateral framework would make them more transparent and unbiased.


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Does Uncertainty Matter ? : A Stochastic Dynamic Analysis of Bankable Emission Permit Trading for Global Climate Change Policy
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Year: 2007 Publisher: Washington, D.C., The World Bank,

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Emission permit trading is a centerpiece of the Kyoto Protocol which allows participating nations to trade and bank greenhouse gas permits under the Framework Convention on Climate Change. When market conditions evolve stochastically, emission trading produces a dynamic problem, in which anticipation about the future economic environment affects current banking decisions. In this paper, the author explores the effect of increased uncertainty over future output prices and input costs on the temporal distribution of emissions. In a dynamic programming setting, a permit price is a convex function of stochastic prices of electricity and fuel. Increased uncertainty about future market conditions increases the expected permit price and causes a risk-neutral firm to reduce ex ante emissions so as to smooth out marginal abatement costs over time. The convexity results from the asymmetric impact of changes in counterfactual emissions on the change of marginal abatement costs. Empirical analysis corroborates the theoretical prediction. The author finds that a 1 percent increase in electricity price volatility measured by the annualized standard deviation of percentage price change is associated with an average decrease in the annual emission rate by 0.88 percent. Numerical simulation suggests that high uncertainty could induce substantially early abatements, as well as large compliance costs, therefore imposing a tradeoff between environmental benefits and economic efficiency. The author discusses policy implications for designing an effective and efficient global carbon market.


Book
Addressing Climate Challenges in ECA Cities
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Year: 2012 Publisher: Washington, D.C. : The World Bank,

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Much of the world's built environment is found in urban areas, and cities are thought to be responsible for up to 70 percent of global greenhouse gas (GHG) emissions, and up to 80 percent of primary energy demand. Most of the energy consumed in the world fuels urban industry, powers urban homes and offices, and moves people within and between cities. This paper is about climate change mitigation in cities, and will primarily look at how local authorities can provide a higher quality of life for their citizens while at the same time achieving higher resource efficiency. It will also look at how climate change mitigation measures could help boost local employment and drive economic growth. The focus will be on buildings (residential, commercial, and office), public services infrastructure (water, sewage, solid waste management, and public lighting), and urban form. Other topics of interest in this respect, such as transport and industrial production will be discussed tangentially in relation to the other topics (e.g. urban form influences and is influenced by transport patterns and strategies).

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