Under What Conditions Does a Carbon Tax on Fossil Fuels Stimulate Biofuels?

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collection.link.5
https://openknowledge.worldbank.org/handle/10986/9
collection.name.5
Policy Research Working Papers
dc.contributor.author
Timilsina, Govinda R.
dc.contributor.author
Csordas, Stefan
dc.contributor.author
Mevel, Simon
dc.date.accessioned
2012-03-19T18:02:31Z
dc.date.available
2012-03-19T18:02:31Z
dc.date.issued
2011-06-01
dc.date.lastModified
2021-04-23T14:02:09Z
dc.description.abstract
A carbon tax is an efficient economic instrument to reduce emissions of carbon dioxide released from fossil fuel burning. Its impacts on production of renewable energy depend on how it is designed -- particularly in the context of the penetration of biofuels into the energy supply mix for road transportation. Using a multi-sector, multi-country computable general equilibrium model, this study shows first that a carbon tax with the entire tax revenue recycled to households through a lump-sum transfer does not stimulate biofuel production significantly, even at relatively high tax rates. This reflects the high cost of carbon dioxide abatement through biofuels substitution, relative to other energy substitution alternatives; in addition, the carbon tax will have negative economy-wide consequences that reduce total demand for all fuels. A combined carbon tax and biofuel subsidy policy, where part of the carbon tax revenue is used to finance a biofuel subsidy, would significantly stimulate market penetration of biofuels. Although the carbon tax and biofuel subsidy policy would cause higher loss in global economic output compared with the carbon tax with lump sum revenue redistribution, the incremental output loss is relatively small.
en
dc.identifier
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110606142136
dc.identifier.uri
http://hdl.handle.net/10986/3441
dc.language
English
dc.relation.ispartofseries
Paper is funded by the Knowledge for Change Program (KCP),Policy Research working paper ; no. WPS 5678
dc.rights
CC BY 3.0 IGO
dc.rights.holder
World Bank
dc.rights.uri
http://creativecommons.org/licenses/by/3.0/igo/
dc.subject
ANTHROPOGENIC EMISSIONS
dc.subject
ATMOSPHERE
dc.subject
BIOMASS
dc.subject
BUSINESS AS USUAL SCENARIO
dc.subject
CAPITAL INVESTMENTS
dc.subject
CARBON
dc.subject
CARBON ABATEMENT
dc.subject
CARBON DEBT
dc.subject
CARBON DIOXIDE
dc.subject
CARBON EMISSIONS
dc.subject
CARBON POLICIES
dc.subject
CARBON SOURCES
dc.subject
CARBON TAX
dc.subject
CARBON TAXES
dc.subject
CARBON-INTENSIVE MANUFACTURING
dc.subject
CHEMICALS
dc.subject
CLEAN ENERGY
dc.subject
CLEAN ENERGY TECHNOLOGIES
dc.subject
CLEANER PRODUCTION
dc.subject
CLIMATE
dc.subject
CLIMATE CHANGE
dc.subject
CLIMATE CHANGE MITIGATION
dc.subject
CLIMATE CHANGE MITIGATION POLICIES
dc.subject
CLIMATE POLICY
dc.subject
CLIMATE PROTECTION
dc.subject
CLIMATIC CHANGE
dc.subject
CO
dc.subject
CO2
dc.subject
COAL
dc.subject
COMBUSTION
dc.subject
COMPUTABLE GENERAL EQUILIBRIUM MODEL
dc.subject
COST OF CARBON
dc.subject
CRUDE OIL
dc.subject
CRUDE OIL PRICE
dc.subject
DEMAND FOR ENERGY
dc.subject
DIESEL
dc.subject
DISPOSABLE INCOME
dc.subject
DOMESTIC SUPPLY
dc.subject
DRIVERS
dc.subject
DRIVING
dc.subject
ECOLOGICAL ECONOMICS
dc.subject
ECOLOGICAL ZONES
dc.subject
EFFICIENCY IMPROVEMENTS
dc.subject
ELASTICITIES
dc.subject
ELASTICITY
dc.subject
ELASTICITY OF SUBSTITUTION
dc.subject
ELECTRICITY
dc.subject
ELECTRICITY GENERATION
dc.subject
ELECTRICITY SUPPLY
dc.subject
EMISSION
dc.subject
EMISSION POLICIES
dc.subject
EMISSION REDUCTION
dc.subject
EMISSION REDUCTION POTENTIAL
dc.subject
EMISSION TAX
dc.subject
EMISSIONS
dc.subject
EMISSIONS FROM FUEL
dc.subject
EMISSIONS FROM LAND-USE CHANGE
dc.subject
END-USE
dc.subject
ENERGY CONSUMPTION
dc.subject
ENERGY ECONOMICS
dc.subject
ENERGY EFFICIENCY
dc.subject
ENERGY INTENSITY
dc.subject
ENERGY INTENSIVE
dc.subject
ENERGY MIX
dc.subject
ENERGY SERVICE
dc.subject
ENERGY SOURCES
dc.subject
ENERGY TAX
dc.subject
ENERGY TRANSFORMATION
dc.subject
ENVIRONMENTAL BENEFITS
dc.subject
ENVIRONMENTAL DAMAGE
dc.subject
ENVIRONMENTAL IMPACTS
dc.subject
ENVIRONMENTAL POLICY
dc.subject
ENVIRONMENTAL PROTECTION
dc.subject
ENVIRONMENTAL RESEARCH
dc.subject
ETHANOL
dc.subject
FOREST
dc.subject
FOREST LAND
dc.subject
FORESTRY
dc.subject
FOSSIL ENERGY
dc.subject
FOSSIL FUEL
dc.subject
FOSSIL FUEL BURNING
dc.subject
FOSSIL FUELS
dc.subject
FUEL CONSUMPTION
dc.subject
FUEL PRICE
dc.subject
FUEL SUPPLY
dc.subject
FUEL TAX
dc.subject
GAS PRODUCTION
dc.subject
GASOLINE
dc.subject
GHG
dc.subject
GLOBAL CARBON TAX
dc.subject
GLOBAL ENERGY MIX
dc.subject
GLOBAL ENERGY SUPPLY
dc.subject
GREENHOUSE
dc.subject
GREENHOUSE GAS
dc.subject
GREENHOUSE GAS EMISSION
dc.subject
GREENHOUSE GAS EMISSION MITIGATION
dc.subject
GREENHOUSE GASES
dc.subject
HOUSEHOLD EXPENDITURES
dc.subject
HOUSEHOLD SECTOR
dc.subject
IMPACTS OF FUEL PRICE
dc.subject
INCOME TAXES
dc.subject
INTERNATIONAL ENERGY AGENCY
dc.subject
IPCC
dc.subject
LAND USE
dc.subject
LAND USE CHANGE
dc.subject
LIQUID FUELS
dc.subject
MITIGATION POTENTIAL
dc.subject
NATURAL GAS
dc.subject
NEGATIVE IMPACTS
dc.subject
NUCLEAR POWER
dc.subject
OILS
dc.subject
PETROLEUM PRICE
dc.subject
PETROLEUM PRODUCTS
dc.subject
POWER GENERATION
dc.subject
PRICE VOLATILITY
dc.subject
REFINED OIL
dc.subject
RENEWABLE ENERGY
dc.subject
RENEWABLE ENERGY SOURCES
dc.subject
ROAD
dc.subject
ROAD TRANSPORT
dc.subject
ROAD TRANSPORT SECTOR
dc.subject
TAX POLICY
dc.subject
TAX RATE
dc.subject
TAX RATES
dc.subject
TAX REVENUE
dc.subject
TAX REVENUES
dc.subject
TAXATION
dc.subject
TOTAL ENERGY DEMAND
dc.subject
TRANSPORT
dc.subject
TRANSPORT SECTOR
dc.subject
TRANSPORT SERVICES
dc.subject
TRANSPORTATION
dc.subject
TRANSPORTATION FUEL
dc.subject
TRUE
dc.subject
WELFARE FUNCTION
dc.title
Under What Conditions Does a Carbon Tax on Fossil Fuels Stimulate Biofuels?
en
okr.date.disclosure
2011-06-01
okr.doctype
Publications & Research :: Policy Research Working Paper
okr.docurl
http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20110606142136
okr.globalpractice
Transport and ICT
okr.googlescholar.linkpresent
yes
okr.identifier.doi
10.1596/1813-9450-5678
okr.identifier.externaldocumentum
000158349_20110606142136
okr.identifier.internaldocumentum
14300405
okr.identifier.report
WPS5678
okr.language.supported
en
okr.pdfurl
http://www-wds.worldbank.org/external/default/WDSContentServer/WDSP/IB/2011/06/06/000158349_20110606142136/Rendered/PDF/WPS5678.pdf
en
okr.region.administrative
The World Region
okr.region.administrative
The World Region
okr.sector
Energy efficiency in power sector
okr.sector
Energy and mining
okr.topic
Transport
okr.unit
Development Research Group (DECRG)
okr.unit
DECRG: Agriculture & Rural Devt. (DECAR)
okr.volume
1 of 1

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