When do environmental regulations backfire? Onsite industrial electricity generation,energy efficiency and policy instruments |
| |
Institution: | 1. School of Economics, Georgia Institute of Technology, 221 Bobby Dodd Way, Atlanta, GA 30332, United States;2. Georgia Institute of Technology, 221 Bobby Dodd Way, Atlanta, GA 30332, United States |
| |
Abstract: | More than half of all energy produced by electric utilities is lost in the form of waste heat. However, when manufacturing facilities choose to produce their own electricity, this waste heat is captured by Combined Heating and Power (CHP) technologies and used in the production process. As a result, manufacturers' pollution footprint can be dramatically reduced by choosing to produce electricity onsite rather than purchasing it from a utility. This paper uses Census microdata to study manufacturers’ decision to produce electricity onsite and examines how plants adjust onsite generation when they are subject to environmental regulations. Environmental regulations will backfire if they cause manufacturers to produce less electricity onsite and shift to electricity from less efficient, offsite electric utilities. We find that manufacturing plants subject to NOx command-and-control regulations decrease onsite electricity generation, increase electricity purchases from off-site utilities and see declines in their energy efficiency. However, manufacturers subject to cap-and-trade see no decline in onsite generation and experience improvements in energy efficiency. These findings demonstrate the importance of instrument selection and identify a new pathway through which emissions leakage may occur. |
| |
Keywords: | Energy efficiency Environmental regulation Vertical integration Distributed generation Instrument choice Q52 Q48 L24 L60 |
本文献已被 ScienceDirect 等数据库收录! |
|