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Environmental impacts of coal subsidies in Turkey: A general equilibrium analysis

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  • Acar, Sevil
  • Yeldan, A. Erinc

Abstract

In this study we aim at providing an analytical framework for Turkey to study the macroeconomics and environmental impacts of the existing coal subsidization scheme. To this end we develop a regionally differentiated applied general equilibrium model spanning over 2015–2030. Our analytical apparatus focuses exclusively on the fiscal implications as well as the environmental repercussions of the removal of the subsidies on greenhouse gas emissions. With the aid of a set of alternative policy scenarios against a “business as usual” path, we study the regional and sectorial performances of growth, employment, investment and capital accumulation, consumption/welfare and trade balance. Our results indicate that by simple elimination of the coal subsidization scheme, Turkey can reduce its aggregate gaseous emissions by as much as 5% without a significant loss in its GDP.

Suggested Citation

  • Acar, Sevil & Yeldan, A. Erinc, 2016. "Environmental impacts of coal subsidies in Turkey: A general equilibrium analysis," Energy Policy, Elsevier, vol. 90(C), pages 1-15.
    • Handle: RePEc:eee:enepol:v:90:y:2016:i:c:p:1-15
    DOI: 10.1016/j.enpol.2015.12.003
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    Cited by:

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    5. Acar, Sevil & Yeldan, A. Erinç, 2018. "Investigating patterns of carbon convergence in an uneven economy: The case of Turkey," Structural Change and Economic Dynamics, Elsevier, vol. 46(C), pages 96-106.
    6. Li, Zhengda & Zheng, Chengxin & Liu, Aimin & Yang, Yang & Yuan, Xiaoling, 2022. "Environmental taxes, green subsidies, and cleaner production willingness: Evidence from China's publicly traded companies," Technological Forecasting and Social Change, Elsevier, vol. 183(C).
    7. Henseler, Martin & Maisonnave, Helene, 2018. "Low world oil prices: A chance to reform fuel subsidies and promote public transport? A case study for South Africa," Transportation Research Part A: Policy and Practice, Elsevier, vol. 108(C), pages 45-62.
    8. Li, Yingzhu & Shi, Xunpeng & Su, Bin, 2017. "Economic, social and environmental impacts of fuel subsidies: A revisit of Malaysia," Energy Policy, Elsevier, vol. 110(C), pages 51-61.
    9. Kang, Jia-Ning & Wei, Yi-Ming & Liu, Lan-Cui & Han, Rong & Yu, Bi-Ying & Wang, Jin-Wei, 2020. "Energy systems for climate change mitigation: A systematic review," Applied Energy, Elsevier, vol. 263(C).
    10. Cardoso, Andrea & Turhan, Ethemcan, 2018. "Examining new geographies of coal: Dissenting energyscapes in Colombia and Turkey," Applied Energy, Elsevier, vol. 224(C), pages 398-408.
    11. Dogan, Berna & Tekgüç, Hasan & Yeldan, A. Erinç, 2022. "Towards A Green Income Support Policy: Investigating Social and Fiscal Alternatives for Turkey," Conference papers 333496, Purdue University, Center for Global Trade Analysis, Global Trade Analysis Project.
    12. Kolsuz, Gunes & Yeldan, A. Erinc, 2017. "Economics of climate change and green employment: A general equilibrium investigation for Turkey," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 1240-1250.
    13. Melikoglu, Mehmet, 2017. "Vision 2023: Status quo and future of biomass and coal for sustainable energy generation in Turkey," Renewable and Sustainable Energy Reviews, Elsevier, vol. 74(C), pages 800-808.
    14. Ayla Alkan & Ayla Oğuş Binatlı & Çağaçan Değer, 2018. "Achieving Turkey’s INDC Target: Assessments of NCCAP and INDC Documents and Proposing Conceivable Policies," Sustainability, MDPI, vol. 10(6), pages 1-27, May.
    15. Ling Du & Hasan Dinçer & İrfan Ersin & Serhat Yüksel, 2020. "IT2 Fuzzy-Based Multidimensional Evaluation of Coal Energy for Sustainable Economic Development," Energies, MDPI, vol. 13(10), pages 1-21, May.
    16. Yousefi-Sahzabi, Amin & Unlu-Yucesoy, Eda & Sasaki, Kyuro & Yuosefi, Hossein & Widiatmojo, Arif & Sugai, Yuichi, 2017. "Turkish challenges for low-carbon society: Current status, government policies and social acceptance," Renewable and Sustainable Energy Reviews, Elsevier, vol. 68(P1), pages 596-608.
    17. Shittu, Ibrahim & Abdul Latiff, Abdul Rais & Baharudin, Siti ‘Aisyah, 2024. "Assessing the compensation and reinvestment plans for fuel subsidy rationalization in Nigeria: A dynamic computable general equilibrium approach," Energy, Elsevier, vol. 293(C).
    18. Zhihua Ding & Caicai Feng & Zhenhua Liu & Guangqiang Wang & Lingyun He & Manzhi Liu, 2017. "Coal price fluctuation mechanism in China based on system dynamics model," Natural Hazards: Journal of the International Society for the Prevention and Mitigation of Natural Hazards, Springer;International Society for the Prevention and Mitigation of Natural Hazards, vol. 85(2), pages 1151-1167, January.
    19. Durmaz, Tunç & Acar, Sevil & Kızılkaya, Simay, 2024. "Generation failures, strategic withholding, and capacity payments in the Turkish electricity market," Energy Policy, Elsevier, vol. 184(C).

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    More about this item

    Keywords

    Coal subsidization; Climate change; Renewable energy sources; Computable general equilibrium; Turkey;
    All these keywords.

    JEL classification:

    • C68 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computable General Equilibrium Models
    • O44 - Economic Development, Innovation, Technological Change, and Growth - - Economic Growth and Aggregate Productivity - - - Environment and Growth
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • Q58 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environmental Economics: Government Policy

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