A General Equilibrium Analysis of Demand Side Management Programs under the Clean Development Mechanism of the Kyoto Protocol
This paper analyzes the economic and environmental consequences of a potential demand side management program in Thailand using a general equilibrium model. The program considers replacement of less efficient electrical appliances in the household...
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| Format: | Policy Research Working Paper |
| Language: | English |
| Published: |
World Bank, Washington, DC
2012
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| Online Access: | http://documents.worldbank.org/curated/en/2008/03/9087214/general-equilibrium-analysis-demand-side-management-programs-under-clean-development-mechanism-kyoto-protocol http://hdl.handle.net/10986/6499 |
| Summary: | This paper analyzes the economic and
environmental consequences of a potential demand side
management program in Thailand using a general equilibrium
model. The program considers replacement of less efficient
electrical appliances in the household sector with more
efficient counterparts. The study further examines changes
in the economic and environmental effects of the program if
it is implemented under the clean development mechanism of
the Kyoto Protocol, which provides carbon subsidies to the
program. The study finds that the demand side management
program would increase economic welfare if the ratio of unit
cost of electricity savings to price of electricity is 0.4
or lower even in the absence of the clean development
mechanism. If the program's ratio of unit cost of
electricity savings to price of electricity is greater than
0.4, registration of the program under the clean development
mechanism would be needed to achieve positive welfare
impacts. The level of welfare impacts would, however, depend
on the price of carbon credits the program generates. For a
given level of welfare impacts, the registration of the
demand side management program under the clean development
mechanism would increase the volume of emission reductions. |
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