Strand, Jon2016-04-262016-04-262016-03https://hdl.handle.net/10986/24137This paper discusses the scope for market mechanisms, already established for greenhouse gas mitigation in Annex 1 countries that ratified the Kyoto Protocol, for implementing "net mitigation," defined here as mitigation beyond Annex 1 countries' formal mitigation requirements under the Kyoto Protocol. Such market mechanisms could be useful for establishing and extending greenhouse gas mitigation targets also under the Paris Agreement from December 2015. Net mitigation is considered in two possible forms: as a "net atmospheric benefit," or as an “own contribution” by offset host countries. A main conclusion is that a “net atmospheric benefit” is possible at least in the short run, best implemented via stricter baselines against which offsets are credited; but it can also take the form of offset discounting whereby offset buyers are credited fewer credits. The latter, although generally inefficient, can be a second-best response to certain imperfections in the offset market, which are discussed in the paper. There is less merit for claiming that "own contributions" can lead to additional mitigation under existing mechanisms.en-USCC BY 3.0 IGOEMISSION ALLOWANCESALLOWANCEEMISSIONS REDUCTIONENVIRONMENTAL ECONOMICSPOWER PLANTSELECTRICITY SECTORENVIRONMENTAL PROTECTIONTEMPERATUREFOSSIL FUELSEMISSIONS GROWTHPUBLIC ECONOMICSEMISSIONS INTENSITYOFFSET PRICEGREENHOUSE GAS EMISSIONSEMISSIONS LEVELSEMISSIONS QUOTASINCOMECARBONMARGINAL COSTVARIABLE COSTDISCOUNT RATEEMISSIONSOFFSET PRICESOFFSET PROJECTSGLOBAL CARBON MARKETINCENTIVESEMISSION REDUCTIONGHGSASYMMETRIC INFORMATIONENERGY SUBSIDIESMODELSGASGLOBAL GREENHOUSE GASEMISSION REDUCTION UNITSEMISSIONS CONTROLPRICEECONOMIC ACTOREMISSION REDUCTIONSAIRGREENHOUSE GASCARBON LEAKAGEECONOMIC ANALYSISEMISSIONS ABATEMENTPOLICY RESPONSEEMISSIONS CONSTRAINTSCO2GREENHOUSE GAS MITIGATIONALLOWANCE ALLOCATIONEFFICIENCY IMPROVEMENTSOFFSET PROJECTSCLIMATE POLICIESFEASIBILITYOFFSET PRICEEMISSION LEVELSGHGPOLICY APPROACHGLOBAL EMISSIONS REDUCTIONCLIMATE‐POLICYCLIMATE POLICIESFREE ALLOCATIONCONVENTION ON CLIMATE CHANGEMARKETSCARBON TAXESEMISSIONS LEAKAGEEMISSIONS PRICESEMISSIONS MITIGATIONEMISSIONS REDUCTIONSELECTRICITY SECTORCLIMATE CHANGEGAS EMISSIONSENVIRONMENTAL ECONOMICSFOSSIL‐FUELCAPSENERGY POLICYFUELSCARBON FINANCEGREENHOUSE GAS CONTROLEMISSIONS REDUCTIONFINANCEGREENHOUSE GASESCAP‐AND‐TRADE POLICYETCARBON EMISSIONSEMISSIONS REDUCTIONSNATIONAL EMISSIONSFREE‐ALLOCATIONEMISSIONS BASELINEGREENHOUSEEMISSIONCONSUMPTIONCLIMATE CHANGE ECONOMICSLEADPOLICIESCLIMATE‐ POLICYCLIMATE CHANGEECONOMIC BEHAVIORCARBON CREDITSPOLICY MAKERSCARBON TAXRESOURCE ECONOMICSELECTRICITYEMISSIONS POLICYDISCOUNT RATESEMISSIONS CAPSCLIMATEDEMANDFORESTSABATEMENTLOWER PRICEGLOBAL EMISSIONHFC‐23CAP‐AND‐TRADE POLICYFOSSIL FUELHISTORICAL EMISSIONSOFFSETS DISCOUNTINGCATALYSTSDOMESTIC EMISSIONSGLOBAL EMISSIONSEMISSIONS ALLOCATIONSMARKETBASELINE” EMISSIONSECONOMIC THEORYPOLICYCERTIFIED EMISSIONS REDUCTIONSENERGY PRODUCTIONALLOWANCESENERGY EFFICIENCYDISCOUNT RATESPURCHASES OF OFFSETSEMISSIONS‐MITIGATIONCLIMATE CHANGE ECONOMICSEMISSIONS TAXESENERGY EFFICIENCYEMISSIONS TARGETSLOWER PRICESCOALALLOCATIONENERGY ECONOMICSSUPPLYPUBLIC ECONOMICSCARBON MARKETENERGY ECONOMICSINTERNATIONAL GREENHOUSE GASINVESTMENTSENVIRONMENTAL PROTECTIONPRICE OF OFFSETSCLIMATE POLICYOFFSETSCLIMATE POLICYECOLOGICAL ECONOMICSRENEWABLE ENERGYINTERNATIONAL OFFSETSGASESCARBON TAXFRAMEWORK CONVENTION ON CLIMATE CHANGEPRICESNEGATIVE IMPACTSBENEFITSINTERNATIONAL GREENHOUSE GASENERGYWorking PaperWorld Bank10.1596/1813-9450-7594