Quotation Gugler, Klaus, Haxhimusa, Adhurim, Liebensteiner, Mario. 2019. Effective Climate Policy Doesn’t Have to be Expensive. EARIE, Barcelona, Spanien, 30.08.-01.09.




We compare the effectiveness of different climate policies in terms of emissions abatement and costs in the British and German electricity markets. For this purpose, we estimate the effects of carbon pricing as well as wind and solar feed-in on electricity Generation from coal and gas allowing us to calculate the costs of abatement of one tonne of CO2 for the different policies. Moreover, we are able to compare the effectiveness of a relatively low EU ETS carbon price in Germany with a significantly higher carbon price due a unilateral top-up tax (the Carbon Price Support) in the UK. We find that a reasonably high price on emissions is the most cost-effective climate policy, while the subsidization of wind is preferable to solar power. A carbon price of around e35 was enough in the UK to induce short-run fuel switching between coal- and gas-fired power plants.


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Publication's profile

Status of publication Published
Affiliation WU
Type of publication Paper presented at an academic conference or symposium
Language English
Title Effective Climate Policy Doesn’t Have to be Expensive
Year 2019
Date 30.08.-01.09.
Country Spain
Location Barcelona
URL https://www.barcelonagse.eu/earie2019
JEL L94, L98, Q35, Q38, Q54, Q58


Gugler, Klaus (Details)
Haxhimusa, Adhurim (Former researcher)
Liebensteiner, Mario (TU Kaiserslautern, Institute for Resource and Energy Economics, Germany)
Research Institute for Regulatory Economics FI (Details)
Department of Economics (Gugler) (Details)
Research areas (ÖSTAT Classification 'Statistik Austria')
5370 Industrial economics (Details)
5372 Regulatory economics (Details)
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