IDEAS home Printed from https://ideas.repec.org/p/rff/dpaper/dp-02-01-.html
   My bibliography  Save this paper

Uncertainty and the Cost-Effectiveness of Regional NOx Emissions Reductions from Electricity Generation

Author

Listed:
  • Burtraw, Dallas

    (Resources for the Future)

  • Bharvirkar, Ranjit
  • McGuinness, Meghan

Abstract

This paper analyzes uncertainties surrounding the benefits and costs of a policy to reduce nitrogen oxides (NOX) emissions from electricity generation in the eastern U.S. Under each of 18 scenarios examined, we find an annual policy would yield net benefits that are at least as great as those expected under the U.S. Environmental Protection Agency’s (EPA) currently planned seasonal policy. Preferred (midpoint) assumptions yield additional benefits of $724 million per year under an annual policy compared to a seasonal one (1997 dollars). The subset of 11 northeastern states benefit the most from an annual policy relative to a seasonal one, but relative net benefits are also positive in the remaining states in the region. An annual policy implemented on a national basis appears to be slightly less cost-effective than the EPA’s policy under midpoint assumptions but it is more cost-effective under half of the scenarios we examine.

Suggested Citation

  • Burtraw, Dallas & Bharvirkar, Ranjit & McGuinness, Meghan, 2002. "Uncertainty and the Cost-Effectiveness of Regional NOx Emissions Reductions from Electricity Generation," RFF Working Paper Series dp-02-01-, Resources for the Future.
    • Handle: RePEc:rff:dpaper:dp-02-01-
    as

    Download full text from publisher

    File URL: http://www.rff.org/RFF/documents/RFF-DP-02-01.pdf
    Download Restriction: no
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Moore, Michael J & Viscusi, W Kip, 1988. "The Quantity-Adjusted Value of Life," Economic Inquiry, Western Economic Association International, vol. 26(3), pages 369-388, July.
    2. Krupnick, Alan J. & Burtraw, Dallas, 1996. "The social costs of electricity: Do the numbers add up?," Resource and Energy Economics, Elsevier, vol. 18(4), pages 423-466, December.
    3. Janusz R. Mrozek & Laura O. Taylor, 2002. "What determines the value of life? a meta-analysis," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 21(2), pages 253-270.
    4. Palmer, Karen L. & Burtraw, Dallas & Bharvirkar, Ranjit & Paul, Anthony, 2001. "Restructuring and the Cost of Reducing NOx Emissions in Electricity Generation," Discussion Papers 10549, Resources for the Future.
    5. Rowe, Robert D. & Lang, Carolyn M. & Chestnut, Lauraine G., 1996. "Critical factors in computing externalities for electricity resources," Resource and Energy Economics, Elsevier, vol. 18(4), pages 363-394, December.
    6. Dallas Burtraw & Alan Krupnick & Erin Mansur & David Austin & Deirdre Farrell, 1998. "Costs And Benefits Of Reducing Air Pollutants Related To Acid Rain," Contemporary Economic Policy, Western Economic Association International, vol. 16(4), pages 379-400, October.
    7. Lawrence H. Goulder & Ian W.H. Parry & Roberton C. Williams III & Dallas Burtraw, 2002. "The Cost-Effectiveness of Alternative Instruments for Environmental Protection in a Second-Best Setting," Chapters, in: Lawrence H. Goulder (ed.), Environmental Policy Making in Economies with Prior Tax Distortions, chapter 27, pages 523-554, Edward Elgar Publishing.
    8. Krupnick, Alan & Alberini, Anna & Cropper, Maureen & Simon, Nathalie & O'Brien, Bernie & Goeree, Ron & Heintzelman, Martin, 2002. "Age, Health and the Willingness to Pay for Mortality Risk Reductions: A Contingent Valuation Survey of Ontario Residents," Journal of Risk and Uncertainty, Springer, vol. 24(2), pages 161-186, March.
    9. Hammitt, James K & Graham, John D, 1999. "Willingness to Pay for Health Protection: Inadequate Sensitivity to Probability?," Journal of Risk and Uncertainty, Springer, vol. 18(1), pages 33-62, April.
    10. Palmer, Karen & Burtraw, Dallas, 1997. "Electricity restructuring and regional air pollution," Resource and Energy Economics, Elsevier, vol. 19(1-2), pages 139-174, March.
    11. Banzhaf, H. Spencer & Desvousges, William H. & Johnson, F. Reed, 1996. "Assessing the externalities of electricity generation in the Midwest," Resource and Energy Economics, Elsevier, vol. 18(4), pages 395-421, December.
    12. Smith, V Kerry & Desvousges, William H, 1987. "An Empirical Analysis of the Economic Value of Risk Changes," Journal of Political Economy, University of Chicago Press, vol. 95(1), pages 89-114, February.
    13. Krupnick, Alan & McConnell, Virginia & Stoessell, Terrell & Cannon, Matthew & Batz, Michael, 2000. "Cost-Effective NOx Control in the Eastern United States," RFF Working Paper Series dp-00-18, Resources for the Future.
    14. Lee, Henry & Darani, Negeen, 1996. "Electricity restructuring and the environment," The Electricity Journal, Elsevier, vol. 9(10), pages 10-15, December.
    15. Jones-Lee, M W & Hammerton, M & Philips, P R, 1985. "The Value of Safety: Results of a National Sample Survey," Economic Journal, Royal Economic Society, vol. 95(377), pages 49-72, March.
    16. Leigh J. Paul, 1995. "Compensating Wages, Value of a Statistical Life, and Inter-industry Differentials," Journal of Environmental Economics and Management, Elsevier, vol. 28(1), pages 83-97, January.
    17. Knill, C, 1996. "Patterns of European Policy Development : The Case of Clean Air Policy," Papers 96/12, European Institute - Political and Social Sciences.
    18. Halûk Özkaynak & George D. Thurston, 1987. "Associations Between 1980 U.S. Mortality Rates and Alternative Measures of Airborne Particle Concentration," Risk Analysis, John Wiley & Sons, vol. 7(4), pages 449-461, December.
    19. Peter Dorman & Paul Hagstrom, 1998. "Wage Compensation for Dangerous Work Revisited," ILR Review, Cornell University, ILR School, vol. 52(1), pages 116-135, October.
    20. Anna Alberini & Alan Krupnick & Maureen Cropper & Nathalie Simon & Joseph Cook, 2002. "The Willingness to Pay for Mortality Risk Reductions: A Comparison of the United States and Canada," CESifo Working Paper Series 668, CESifo.
    21. William H. Desvousges & F. R. Johnson & H. S. Banzhaf, 1998. "Environmental Policy Analysis With Limited Information," Books, Edward Elgar Publishing, number 1328.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Spencer Banzhaf, H. & Burtraw, Dallas & Palmer, Karen, 2004. "Efficient emission fees in the US electricity sector," Resource and Energy Economics, Elsevier, vol. 26(3), pages 317-341, September.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Burtraw, Dallas & Palmer, Karen L. & Bharvirkar, Ranjit & Paul, Anthony, 2001. "Cost-Effective Reduction of NOx Emissions from Electricity Generation," Discussion Papers 10677, Resources for the Future.
    2. Dallas Burtraw & Ranjit Bharvirkar & DMeghan McGuinness, 2003. "Uncertainty and the Net Benefits of Emissions Reductions of Nitrogen Oxides from Electricity Generation," Land Economics, University of Wisconsin Press, vol. 79(3), pages 382-401.
    3. Burtraw, Dallas & Palmer, Karen & Krupnick, Alan & Toman, Michael & Paul, Anthony & Bloyd, Cary, 2001. "Ancillary Benefits of Reduced Air Pollution in the United States from Moderate Greenhouse Gas Mitigation Policies in the Electricity Sector," RFF Working Paper Series dp-01-61-, Resources for the Future.
    4. Revesz, Richard & Stavins, Robert, 2004. "Environmental Law and Policy," Working Paper Series rwp04-023, Harvard University, John F. Kennedy School of Government.
    5. James Hammitt & Jin-Tan Liu, 2004. "Effects of Disease Type and Latency on the Value of Mortality Risk," Journal of Risk and Uncertainty, Springer, vol. 28(1), pages 73-95, January.
    6. Spencer Banzhaf, H. & Burtraw, Dallas & Palmer, Karen, 2004. "Efficient emission fees in the US electricity sector," Resource and Energy Economics, Elsevier, vol. 26(3), pages 317-341, September.
    7. Bellavance, Franois & Dionne, Georges & Lebeau, Martin, 2009. "The value of a statistical life: A meta-analysis with a mixed effects regression model," Journal of Health Economics, Elsevier, vol. 28(2), pages 444-464, March.
    8. Maureen Cropper & James K. Hammitt & Lisa A. Robinson, 2011. "Valuing Mortality Risk Reductions: Progress and Challenges," Annual Review of Resource Economics, Annual Reviews, vol. 3(1), pages 313-336, October.
    9. Krupnick, Alan & Alberini, Anna & Cropper, Maureen & Simon, Nathalie & O'Brien, Bernie & Goeree, Ron & Heintzelman, Martin, 2002. "Age, Health and the Willingness to Pay for Mortality Risk Reductions: A Contingent Valuation Survey of Ontario Residents," Journal of Risk and Uncertainty, Springer, vol. 24(2), pages 161-186, March.
    10. Burtraw, Dallas & Palmer, Karen & Bharvirkar, Ranjit & Paul, Anthony, 2001. "Restructuring and Cost of Reducing NOx Emissions in Electricity Generation," RFF Working Paper Series dp-01-10-rev, Resources for the Future.
    11. Alberini, Anna & Ščasný, Milan, 2018. "The benefits of avoiding cancer (or dying from cancer): Evidence from a four- country study," Journal of Health Economics, Elsevier, vol. 57(C), pages 249-262.
    12. Matthew Cole & Robert Elliott & Joanne Lindley, 2009. "Dirty money: Is there a wage premium for working in a pollution intensive industry?," Journal of Risk and Uncertainty, Springer, vol. 39(2), pages 161-180, October.
    13. James K. Hammitt, 2002. "QALYs Versus WTP," Risk Analysis, John Wiley & Sons, vol. 22(5), pages 985-1001, October.
    14. Dionne, Georges & Lebeau, Martin, 2010. "Le calcul de la valeur statistique d’une vie humaine," L'Actualité Economique, Société Canadienne de Science Economique, vol. 86(4), pages 487-530, décembre.
    15. Krupnick, Alan & Alberini, Anna & Simon, Nathalie & Itaoka, Kenshi & Akai, Makoto & Cropper, Maureen, 2005. "Age, Health, and the Willingness to Pay for Mortality Risk Reductions: A Contingent Valuation Survey in Japan," RFF Working Paper Series dp-05-34, Resources for the Future.
    16. Viscusi, W Kip & Aldy, Joseph E, 2003. "The Value of a Statistical Life: A Critical Review of Market Estimates throughout the World," Journal of Risk and Uncertainty, Springer, vol. 27(1), pages 5-76, August.
    17. Burtraw, Dallas & Palmer, Karen L. & Heintzelman, Martin, 2000. "Electricity Restructuring: Consequences and Opportunities for the Environment," Discussion Papers 10854, Resources for the Future.
    18. Kenshi Itaoka & Alan Krupnick & Makoto Akai & Anna Alberini & Maureen Cropper & Nathalie Simon, 2007. "Age, health, and the willingness to pay for mortality risk reductions: a contingent valuation survey of Shizuoka, Japan, residents," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 8(3), pages 211-237, September.
    19. Cameron, Trudy Ann & DeShazo, J.R., 2013. "Demand for health risk reductions," Journal of Environmental Economics and Management, Elsevier, vol. 65(1), pages 87-109.
    20. Cropper, Maureen L., 2000. "Has Economic Research Answered the Needs of Environmental Policy?," Journal of Environmental Economics and Management, Elsevier, vol. 39(3), pages 328-350, May.

    More about this item

    Keywords

    emissions trading; electricity; particulates; nitrogen oxides; NOX; health benefits; market structure; restructuring; deregulation; value of statistical life; uncertainty;
    All these keywords.

    JEL classification:

    • Q2 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:rff:dpaper:dp-02-01-. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Resources for the Future (email available below). General contact details of provider: https://edirc.repec.org/data/rffffus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.