Abstract

To achieve national reduction goals, greenhouse gas reduction in the power eneration sector is important. Although the burden of reduction is continually given to the power generation sector under the greenhouse gas emission trading system as a major policy tool, criticism has been raised that the carbon price burden is not properly signaled. This paper aims to provide evidence of policies that enable fuel conversion of power generation using permit allocation schemes. We conduct policy scenario analyses on fuel conversion that allow policy makers to choose a microscopic permit-allocation policy considering the coal, natural gas, and carbon market conditions.

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