Abstract

In this study we analyze the impact of a radical change in nuclear electricity costs on the optimal electricity generation technology mix (EGTM) and constrain the value of information (VOI) on future nuclear costs. We consider three nuclear cost events and four carbon emissions caps. We develop a two-stage framework for energy-economic model MARKAL to eliminate foresight of future nuclear cost movements. We examine how the EGTM responds to these movements under alternative caps and analyze how these movements affect the cost of each cap. We define the expected savings from perfect foresight (ESPF), an upper bound on the VOI. We found that with current technologies, carbon mitigation that does not rely heavily on nuclear electricity is economically insensible. The Strong Cap is extremely costly because it restricts flexibility to respond to cost signals in choosing among technologies. The ESPF is highest under the Medium Cap by a substantial margin. [PUBLICATION ABSTRACT]

Details

Title
Carbon Emissions Caps and the Impact of a Radical Change in Nuclear Electricity Costs
Author
Leibowicz, Benjamin D; Roumpani, Maria; Larsen, Peter H
Pages
60-74
Section
Articles
Publication year
2013
Publication date
2013
Publisher
EconJournals
ISSN
21464553
Source type
Scholarly Journal
Language of publication
English
ProQuest document ID
1266465697
Copyright
© 2013. This work is published under http://creativecommons.org/licenses/by/4.0/ (the “License”). Notwithstanding the ProQuest Terms and conditions, you may use this content in accordance with the terms of the License.