Implementing a time- and location-differentiated cap-and-trade program : flexible nitrogen oxide abatement from power plants in the eastern United States

Studies suggest that timing and location of emissions can change the amount of ozone formed from a given amount of nitrogen oxide (NOx) by a factor of five (Mauzerall et al. 2005). Yet existing NOx cap-and-trade programs require stationary sources in the Eastern U.S. to reduce emissions without reference to timing or location. This work is part of a larger study on whether a NOx cap-and-trade program that differentiates across emissions by time and location could reduce ozone concentrations more cost-effectively than simple aggregate reductions in the NOx cap in the Eastern United States. To gauge possible gains relative to existing regulations, this work examines compliance data from coal power plants in 2002 and 2005 to estimate the effectiveness of existing un-differentiated regulations. It finds that some plant operators chose to remain under aggregated caps by emitting less NOx during early summer months when effects on ozone formation are low and emitting more NOx during late summer months when effects on ozone formation are great. This behavior was at once individually rational, environmentally damaging, and perfectly legal. To evaluate potential challenges to implementation, the study assesses the technical feasibility and the distributional effects of spatially and temporally differentiated regulatory systems. * Are power plants in the Eastern U.S. technically capable of reducing NOx emissions in response to incentives that changed in time and by location given network constraints? To address these questions, this work used a zonal model based on an abstract network graph and optimal power flow simulations to estimate potential short-term NOx reductions and associated costs from redispatch of power plants in the original Pennsylvania-New Jersey-Maryland (PJM) power system.

Department dc:contributor.department

Massachusetts Institute of Technology. Technology, Management, and Policy Program.

Grantor dc:publisher

Massachusetts Institute of Technology

Year dc:date.issued

2007

Author dc:creator

• Martin, Katherine C

Advisor dc:contributor.advisor

• David H. Marks, A. Denny Ellerman, Paul L. Joskow and Kenneth A. Oye.

• Technology, Management, and Policy Program.

Statement dc:rights

• M.I.T. theses are protected by copyright. They may be viewed from this source for any purpose, but reproduction or distribution in any format is prohibited without written permission. See provided URL for inquiries about permission.

Licence dc:rights.uri

• http://dspace.mit.edu/handle/1721.1/7582

Language dc:language.iso

eng

Handle dc:identifier.uri

http://hdl.handle.net/1721.1/43857

OAI identifier oai:identifier

oai:dspace.mit.edu:1721.1/43857