An experimental analysis of compliance in dynamic emissions markets

Two important design elements for emission trading programs are whether and to what extent firms are able to bank emissions permits, and how these programs are to be enforced. In this paper we present results from laboratory emissions markets designed to investigate enforcement and compliance when these markets allow permit banking. Banking is motivated by a decrease in the aggregate permit supply in the middle of multi-period trading sessions. Consistent with theoretical insights, our experiments suggest that high permit violation penalties have little deterrence value in dynamic emissions markets, and that the main challenge of enforcing these programs is to motivate truthful self-reports of emissions.     

Risk aversion and compliance in markets for pollution control

This paper examines the effects of risk aversion on compliance choices in markets for pollution control. A firm's decision to be compliant or not is independent of its manager's risk preference. However, non-compliant firms with risk-averse managers will have lower violations than otherwise identical firms with risk-neutral managers. The violations of non-compliant firms with risk-averse managers are independent of differences in their profit functions and their initial allocations of permits if and only if their managers' utility functions exhibit constant absolute risk aversion. However, firm-level characteristics do impact violation choices when managers have coefficients of absolute risk aversion that are increasing or decreasing in profit levels. Finally, in the equilibrium of a market for emissions rights with widespread non-compliance, risk aversion is associated with higher permit prices, better environmental quality, and lower aggregate violations.     

Emission reduction characteristics of a catalyzed continuously regenerating trap after-treatment system and its durability performance

The primary purpose of this study was to investigate the effect of a catalyzed continuously regenerating trap(CCRT)system composed of a diesel oxidation catalyst(DOC)and a catalyzed diesel particulate filter(CDPF)on the main gaseous and particulate emissions from an urban diesel bus,as well as the durability performance of the CCRT system.Experiments were conducted based on a heavy chassis dynamometer,and a laboratory activity test as well as X-ray photoelectron spectroscopy(XPS)test were applied to evaluate the changes of the aged CCRT catalyst.Results showed that the CCRT could reduce the CO by 71.5%and the total hydrocarbons(THC)by 88.9%,and meanwhile promote the oxidation of NO.However,the conversion rates for CO and THC dropped to 25.1%and 55.1%,respectively,after the CCRT was used for one year(～60,000 km),and the NO oxidation was also weakened.For particulate emissions,the CCRT could reduce 97.4%of the particle mass(PM)and almost 100%of the particle number(PN).The aging of the CCRT resulted in a reduced PM trapping efficiency but had no observable effect on the PN;however,it increased the proportion of nucleation mode particles.The activity test results indicated that the deterioration of the CCRT was directly relevant to the increase in the light-off temperatures of the catalyst for CO,C_3H_8 and NO_2.In addition,the decreased concentrations of the active components Pt~(2+) and Pt~(4+) in the catalyst are also important factors in the CCRT deterioration.