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Banal-Estañol, Albert; Eckhause, Jeremy; Massol, Olivier (2016)
Publisher: Elsevier
Languages: English
Types: Article
Subjects: Coordination failure, Carbon Capture and Storage, [SHS.ECO] Humanities and Social Sciences/Economies and finances, Tax incentives, HB, HC, Learning effects, T1, Levelized cost
International audience; This note details two comments on a recent policy proposal in Comello and Reichelstein (2014) aimed at favoring the early adoption of Carbon Capture (CC) technology in the next generation of thermal-based power plants to be installed in the United States. First, we examine the implications of a worst-case scenario in which no new CC is adopted internationally beyond what is in place in 2014. Second, we show the potential, under the original proposed subsidy, for the emergence of coordination failures capable of hampering the desired early CC deployment. We propose and evaluate modified schedules of tax-credits sufficient to overcome these concerns. These additions strengthen the argument in the original article: namely, though higher incentive levels are necessary, our findings confirm that the cost of the proposed policy is not out of reach.
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    • Comello, S., Reichelstein, S., (2014). Incentives for early adoption of carbon capture technology. Energy Policy, 74, 579-588.
    • GCCSI, (2013). Global CCS Institute Status of http://www.globalccsinstitute.com/data/status-ccs-project-database.
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