Data Entry: Please note that the research database will be replaced by UNIverse by the end of October 2023. Please enter your data into the system Thanks

Login for users with Unibas email account...

Login for registered users without Unibas email account...

Pricing emission permits in the absence of abatement
JournalArticle (Originalarbeit in einer wissenschaftlichen Zeitschrift)
ID 1530547
Author(s) Hintermann, Beat
Author(s) at UniBasel Hintermann, Beat
Year 2012
Title Pricing emission permits in the absence of abatement
Journal Energy Economics
Volume 34
Number 5
Pages / Article-Number 1329-1340
Abstract If emissions are stochastic and firms are unable to control them through abatement, the cap in a permit market may be exceeded, or not be reached.† I derive a binary options pricing formula that expresses the permit price as a function of the penalty for noncompliance and the probability of an exceeded cap under the assumption of no abatement.† I apply my model to the EU ETS, where the rapid introduction of the market made it difficult for firms to adjust their production technology in time for phase 1.† The model fits the data well, implying that the permit price was at least partly driven by firms hedging against stochastic emissions.
Publisher Elsevier
ISSN/ISBN 0140-9883
Full Text on edoc Available
Digital Object Identifier DOI 10.1016/j.eneco.2012.06.005
ISI-Number WOS:000308573300008
Document type (ISI) Article

MCSS v5.8 PRO. 0.373 sec, queries - 0.000 sec ©Universität Basel  |  Impressum   |