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on Resource Economics |
| By: | Aldy, Joseph E. (Resources for the Future); Reinhardt, Forest L.; Stavins, Robert (Resources for the Future) |
| Abstract: | There is growing recognition of the relative importance of anthropogenic emissions of methane as a contributor to global climate change. An important source of such emissions in some countries, including the United States, is the oil and gas (O&G) sector. This points to the importance of developing understanding of the marginal abatement cost functions for methane emissions reductions. Scholars have employed a diverse set of methodologies to estimate abatement costs, including engineering cost models, econometric analysis of natural gas markets, and statistical retrospective analysis of state-level regulation. We critically examine these approaches and synthesize their results. We find significant potential for low-cost methane abatement in the O&G sector in the United States and elsewhere, although claims of widespread negative abatement cost opportunities should be taken with a grain of salt. We also find that the potential for low-cost abatement is not without limit. Whereas it appears that cutting methane emissions in half would be relatively inexpensive, a sharp uptick in marginal abatement cost may occur when reductions exceed 60 to 80 percent below baseline levels. This threshold may change over time with technological advances in remote sensing, which can reduce abatement costs at various levels of ambition.Key Words: methane emissions; marginal abatement cost; climate change.JEL Classification Codes: Q52, Q54, Q58. |
| Date: | 2025–08–11 |
| URL: | https://d.repec.org/n?u=RePEc:rff:dpaper:dp-25-20 |
| By: | Clay, Karen (Carnegie Mellon University); Jha, Akshaya (Carnegie Mellon University); Lewis, Joshua (University of Montreal); Severnini, Edson (Boston College) |
| Abstract: | This paper documents the evolution of US carbon emissions and discusses the main factors that contributed to the historical carbon emissions rollercoaster. We divide the discussion into four periods – up to 1920, 1920-1960, 1960-2005 and after 2005. For each period, we discuss the main drivers of national carbon emissions. We then discuss trends in carbon emissions in the electricity sector. Electricity sector emissions were initially very small, but would become the largest source of US carbon emissions over the period 1980-2015, and the largest contributor to decarbonization since 2007. In the final section, we distill lessons from the U.S. experience that may inform decarbonization strategies in developing economies. |
| Keywords: | environmental regulation, electricity sector, energy transition, decarbonization, carbon emissions, clean air act, climate policy |
| JEL: | N72 Q31 Q48 Q54 |
| Date: | 2025–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp18008 |
| By: | Carattini, Stefano; Huang, Hanwei; Pisch, Frank; Singh, Tejendra Pratap |
| Abstract: | Although the environmental impact of trade has been a long-standing concern, there is still only scant evidence on the channels through which international market access affects pollution. In this paper, we exploit the unique episode of China's world market integration in the early 2000s to provide direct empirical evidence on three such mechanisms. We combine granular satellite data on air pollution with detailed information on manufacturing firms and coal power plants, and leverage exogenous foreign demand shocks for identification. Three main findings emerge: exporting firms reduce local pollution (scope-1); pollution levels around coal power plants rise due to regional export shocks (scope-2); and upstream suppliers reduce pollution in the face of export demand shocks to downstream firms (scope-3). Our findings point to China's reliance on coal power plants to fuel its export-driven growth as one of the main drivers of the rise in pollution. |
| Keywords: | Trade, pollution, satellite, supply chain, coal power plants, electricity |
| JEL: | D22 F18 F64 H23 Q53 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:usg:econwp:2025:04 |