(Bio-)Fuel mandating and the green paradox
Title
(Bio-)Fuel mandating and the green paradox
Subject
Climate change
Green paradox
Carbon taxes
Fuel mandates
Renewable energy subsidies
Description
Well-intended preannounced carbon mitigation policies can lead to adverse impacts such as the green paradox. This paper examines conditions impacting the prevalence of this phenomenon, when suppliers of carbon-free energy, similarly to carbon suppliers, can anticipate the implementation of preannounced carbon regulation. Neglecting the interim build-up of carbon-free capacity that responds to preannounced climate policies over-estimates the green paradox. For EU-2020 and US-2022 calibrated biofuel mandating targets, simulations point to a robust 0.4–0.6% decline in premandate global crude oil supply, suggesting that concerns over the green paradox may have been overstated. Mandate designs to mitigate the green paradox are also examined. Initially mild targets that are complemented by increasingly stringent ones are more effective at curbing the green paradox than ambitious but delayed targets.
105014
95
Publisher
Energy Economics
Date
2021
2021-03-01
Contributor
Okullo, Samuel J.
Reynès, Frédéric
Hofkes, Marjan W.
Type
journalArticle
Identifier
0140-9883
10.1016/j.eneco.2020.105014
URL
https://www.sciencedirect.com/science/article/pii/S0140988320303546
Collection
Citation
“(Bio-)Fuel mandating and the green paradox,” Lamar University Midstream Center Research, accessed May 18, 2024, https://lumc.omeka.net/items/show/15701.