Estimating the General Equilibrium Benefits of Changes in Air Quality From Adoption of Alternative Fuel Technology Vehicles

The goal of this paper is to quantify health benefits from reduction in air pollutants due to imposition of carbon tax. The model used for this analysis is the Applied Dynamic Analysis of the Global Economy (ADAGE) model, a recursive dynamic, multi-region, and multi-sector computable general equilibrium model. The model has rich details in energy, transportation, agriculture, biofuel, and land. ADAGE contains greenhouse gases (GHG) accounting (carbon dioxide, CO2; methane, CH4; nitrous oxide, N2O; hydrofluorocarbons, HFCs; perfluorocarbons, PFCs; and sulfur hexafluoride, SF6). For this study, we include air pollutants into ADAGE. The data for global emissions of air pollutants come from the European Commission Joint Research Center. The global anthropogenic emission inventory reports data for several air pollutants (SO2, NOx, CO, NMVOC, NH3) including detailed information on particulates (PM10, PM2.5, BC, and OC) for the reference year 2010. The information about emissions in the global emissions inventory was disaggregated by the corresponding sector and source in ADAGE. A set of carbon price scenarios is used to represent our environmental policies to mitigate climate change and promote the expansion of alternative fuel vehicles. We expect these scenarios could provide results on how alternative fuel vehicles compete with each other as well as with conventional fuel vehicles and, more importantly, the impact on overall GHG emissions as well as air pollutant emissions under each of these carbon price scenarios. To quantify the health benefits of the air pollution reductions, we used the EPA’s Environmental Benefits Mapping and Analysis Program (BenMAP) for Global Health Impact Analysis. The BenMAP open domain software is a useful tool to conduct a “damage function” approach to relate anthropogenic air pollution to health outcomes, such as premature deaths due to exposure to air pollutants.