Can preapproval jump-start the allowance market
With compliance deadlines approaching in three years, utility, environmental and financial planners and their regulators are in the process of grappling with the requirements imposed, and opportunities created, by the acid rain program established under Title 4 of the Clean Air Act amendments of 1990. The novel element of the program - emissions or allowance trading through a nationwide allowance market - presents great challenges for utilities and their regulators. Perhaps the foremost challenge is establishing the allowance market. If state utility commissions subject utilities' compliance strategies to traditional after-the-fact prudence reviews, as tradition would impel them to do, the attendant regulatory risks are likely to push utilities toward more conservative compliance schemes that underuse allowance trading (as the exchange at the head of this article demonstrates). If that happens, the market will fail to develop, and its full potential for environmental benefit at least cost will go unrealized. This, in turn, is likely to strengthen the case for non-market regulatory mechanisms - a vicious circle. In this paper, the authors suggest a way out of this.
- OSTI ID:
- 7147482
- Journal Information:
- Electricity Journal; (United States), Vol. 5:5; ISSN 1040-6190
- Country of Publication:
- United States
- Language:
- English
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Related Subjects
ELECTRIC POWER INDUSTRY
ECONOMICS
SULFUR DIOXIDE
AIR POLLUTION CONTROL
ACID RAIN
MARKET
POLLUTION REGULATIONS
STATE GOVERNMENT
US CLEAN AIR ACT
ATMOSPHERIC PRECIPITATIONS
CHALCOGENIDES
CONTROL
INDUSTRY
LAWS
OXIDES
OXYGEN COMPOUNDS
POLLUTION CONTROL
POLLUTION LAWS
RAIN
REGULATIONS
SULFUR COMPOUNDS
SULFUR OXIDES
200600* - Fossil-Fueled Power Plants- Economic
Industrial
& Business Aspects- (1990-)
200202 - Fossil-Fueled Power Plants- Waste Management- Noxious Gas & Particulate Emissions