Impact of Energy Price Reform on Environmental Emissions; A Computable General Equilibrium Approach

Manzoor, Davood and Haqiqi, Iman (2012): Impact of Energy Price Reform on Environmental Emissions; A Computable General Equilibrium Approach. Published in: Journal of Environmental Studies , Vol. 37, No. 60 (2012): pp. 1-12.

Abstract

An increase in energy prices will decrease fossil fuel consumption; on the other hand, the cost-push will encourage technology improvement for firms and households. These changes will affect the emission level. This paper studies the changes in yearly pollutant emissions after an energy price reform in Iran. We apply a computable general equilibrium model which consists of 7 energy goods (Electricity, natural gas, liquid gas, gasoline, kerosene, fuel, gas-oil) and also 7 pollutants (CO, CO2, SO2, SO3, CH, SPM, NOx). The model is calibrated based on a Micro Consistent Matrix of 2001 from the Ministry of Energy. We also assume different scenarios of energy layer elasticity which describe different technology changes in our sensitivity analysis. The findings suggest that by an increase in energy prices, the emission of most pollutants would decrease except for CO and CH. For these two, depending on the technology changes after the policy, their emission may decline or not. The decline in CO2 emission will be between 9 and 16 percent.

• Item Type: MPRA Paper
• Language: Persian
• Keywords: Air Pollution; Computable General Equilibrium model; Emissions; Micro Consistent Matrix; Technological change
• Subjects: C - Mathematical and Quantitative Methods > C6 - Mathematical Methods ; Programming Models ; Mathematical and Simulation Modeling > C68 - Computable General Equilibrium Models; D - Microeconomics > D5 - General Equilibrium and Disequilibrium > D58 - Computable and Other Applied General Equilibrium Models; D - Microeconomics > D6 - Welfare Economics > D61 - Allocative Efficiency ; Cost-Benefit Analysis; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q52 - Pollution Control Adoption and Costs ; Distributional Effects ; Employment Effects; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q53 - Air Pollution ; Water Pollution ; Noise ; Hazardous Waste ; Solid Waste ; Recycling; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q5 - Environmental Economics > Q58 - Government Policy

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