Publication year: 2011 Source: Computers & Industrial Engineering, Available online 25 October 2011 Yanyi He, Lizhi Wang, Jianhui Wang We compare the effectiveness and efficiency of cap-and-trade and carbon tax policies in a generation expansion planning framework. The effectiveness refers to a policy’s capability to control the amount of carbon emissions, and the efficiency is measured with respect to seven criteria: average emissions price, actual emissions, renewable energy portfolio, total generation, total profit of Gencos and grid owner, economic welfare, and emissions adjusted economic welfare. Cap-and-trade and four variations of carbon tax policies are integrated in a game-theoretic based generation expansion planning model to assess their impacts on new investment in renewable energy generation capacity
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Cap-and-Trade vs. Carbon Taxes: A Quantitative Comparison from A Generation Expansion Planning Perspective