Economics of Lifecycle Analysis and Greenhouse Gas Regulation of Fuels

May 28, 2009 - 12:00pm

Unlike with conventional fossil fuels, lifecycle GHG emissions from energy sources such as biofuels, batteries, oil sands, and coal-to-liquids are not concentrated in the end use stage. Since GHG are global pollutants, regulations should target limiting lifecycle GHG emission attributable of the product and not merely that from combustion (assuming that GHG regulations are not economy-wide and not global). Given this context, my dissertation focuses on the following two topics. (1) Economics of lifecycle analysis: The debate about the GHG benefits of biofuels stems from the limited understanding of the role of prices and policies in determining the lifecycle impact of a technology. I will discuss the strength and weakness of current methods of estimation of lifecycle emissions from a policy perspective. I will then describe a framework for estimating lifecycle emissions as a function of prices and policies. (2) Economics of GHG regulation of fuels: Policy makers can choose from several different types of instruments such as emission fees, tradable emission permits and emission intensity standards for controlling emissions. When damage is a function of pollutant concentration, as is the case with pollutants like lead and carbon-monoxide, the tendency has been to regulate emission intensity. When damage is a function of aggregate pollution, as is the case with GHG, the tendency has been to regulate aggregate emissions. However, California’s Low Carbon Fuel Standard and the Renewable Fuel Standard’s limit on carbon intensity of renewable fuel represent a departure from such a past. I compare how abatement cost, output and emissions are likely to differ between intensity regulation and a policy based on aggregate emission cap in the cases of GHG. For more information about this seminar, please contact: JoAnne Lambert 510.486.4835, or send e-mail to JMLambert[at]

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