Carbon Emission Reduction Cost Research Articles

Evolutionary game analysis of government, businesses, and consumers in high-standard farmland low-carbon construction

Abstract Soil is an important carbon reservoir, and high-standard farmland construction projects have significant potential to promote low-carbon development. In order to study the management and implementation of low-carbon production in high-standard farmland construction projects, the tripartite evolution game model of government, business, and consumer is constructed based on the tripartite bounded rationality. Then, the behavior strategy of tripartite stakeholders is analyzed with the method of system dynamics. Finally, the evolution process of tripartite interaction behavior is simulated using the MATLAB tool. The results show that: (1) The subsidy and punishment mechanism of the government must be aligned. In addition, the net income of government regulation is higher than the sum of the government’s environmental governance fees and fines of non-regulation; (2) The government, business, and consumers all choose their own behavioral strategies based on their own interests. (3) When the government’s environmental governance fee reaches a particular value, the system will appear imbalanced. In light of this, it is suggested that the government should increase support for business and use media publicity, consumer subsidies, and other measures to promote the consumption of low-carbon products. The business should constantly reduce the cost of carbon emission reduction through technological innovation.

Manufacturer encroachment with carbon cap-and-trade policy under asymmetric information

In order to mitigate carbon emissions and address environmental concerns, an increasing number of industries have started investing in green technologies to produce environmentally friendly products. This research develops a game theoretical model to examine the phenomenon of manufacturer encroachment in the context of carbon emission reduction and asymmetric information. Our analysis reveals that when the manufacturer does not encroach, a reduction in carbon emissions benefits all members of the supply chain. However, under encroachment, only the manufacturer stands to benefit from the reduction in carbon emissions. Moreover, with a low direct selling cost, we recommend that the manufacturer should aim to achieve a lower level of carbon emissions under encroachment compared to non-encroachment scenarios. Another key finding is that the benefits of encroachment for the manufacturer depend on the relative costs of direct selling and carbon emission reduction. Encroachment is advantageous to the manufacturer when either the direct selling cost or the carbon emission reduction cost is low. On the other hand, encroachment benefits the retailer only when both the direct selling cost and the carbon emission reduction cost are high. Furthermore, we demonstrate that it is in the retailer’s best interest to voluntarily share demand information with the manufacturer, particularly when the direct selling cost is either low or high. By sharing demand information, the retailer can enhance the overall performance of the supply chain. Overall, this study provides valuable insights for managers regarding encroachment and carbon emission decisions in the context of low carbon manufacturing, carbon cap-and-trade policies, and asymmetric information. These findings can guide decision-making processes and help optimize the performance of supply chains in environmentally conscious settings.

Recycling Strategy of Green Closed-Loop Supply Chain Under Urban and Rural Low-Carbon Planning

Abstract The low-carbon ecological city aims to harmonise sustainable urban development with low-emission planning approaches. Emissions from business production processes are central to low-carbon planning. This paper explores three closed-loop supply chain recycling models - manufacturer, retailer, and third-party -considering carbon trading and emission reduction technology investment. Respective Stackelberg game models are developed incorporating carbon emission reduction costs, recycling costs, carbon trading price, emission intensity, and recycling price. The influence of these variables on carbon emission reduction and profit is examined through numerical analysis. Results indicate the government’s free carbon quota does not impact per-unit carbon reduction or manufacturer profit, nor optimal recycling mode selection. Under specific remanufacturing emission intensity and production cost saving conditions, carbon quota trading can substantially incentivise manufacturers to invest in emission reduction and recycling. With carbon trading and emission reduction technology investment, manufacturer recycling optimises economic and environmental benefits when remanufactured products provide high production cost savings. This fosters sustainable development supporting low-carbon planning.

Pricing and carbon emission decisions in the assembly supply chain

In the low-carbon environment, firms must make pricing and carbon emission decisions. This study proposes an assembly supply chain model which contains two manufacturers and one assembler to research their pricing and carbon emission decisions. Because of manufacturing core components for final products, manufacturers dominate the assembler in Stackelberg games. Supply chain members' optimal decisions and optimal carbon emission reduction structure are derived based on different cooperative behaviors. Then, this study analyzes how manufacturers' carbon emission reduction cost coefficients affect decision results and finds that the assembly system will produce products with lower carbon emissions and expand market shares if manufacturers enhance carbon emission reduction abilities, but there exist manipulation spaces for supply chain members to raise the market price. Lastly, this study investigates the impacts of cooperative behaviors on decision results and finds that cooperation in the assembly supply chain can consistently achieve a win-win situation as a Pareto improvement. Meanwhile, this study concludes some management insights with practical significance, such as from the manufacturer's perspective, vertical cooperation with the assembler is more effective than horizontal cooperation with another manufacturer, and the assembler should cooperate with the manufacturer with a lower cost coefficient.

Carbon emission allowance allocation based on a bi-level multi-objective model in maritime shipping

To mitigate carbon emissions from maritime shipping, this study investigates the strategies and performance of allocating carbon emission allowances (CEAs) with the cap-and-trade mechanism among shipping companies. Using a bi-level model solved by the multi-objective particle swarm optimization algorithm based on Pareto solution set, the interactions between decisions of the government and shipping companies are well characterized. The results of the benchmark scenario indicate that all shipping companies’ optimal carbon emissions decrease annually during the planning period, and a larger company usually exhibits a better emission reduction performance. However, economic benefits of shipping companies and the society display an annually declining trend due to additional carbon emission reduction costs. The sensitivity analysis demonstrates that the decreasing carbon prices lead to more emissions, while the optimal total carbon emissions decrease as carbon reduction costs increase. These findings create implications for multiple stakeholders to formulate their own carbon emissions mitigation strategies under the cap-and-trade mechanism.

Marginal Carbon Dioxide Emission Reduction Cost and Influencing Factors in Chinese Industry Based on Bayes Bootstrap

Accurate measurement of the shadow price of carbon dioxide (CO2) is fundamental to the scientific assessment of the carbon emission reduction cost and the formulation and execution of China’s carbon emission mitigation policies. Underpinned by the directional distance function, this research uses a parametric linear programming method and a Bayes bootstrap estimation method to estimate the marginal CO2 emission reduction cost of the industrial sector in China and to quantify the related influencing factors. The results revealed that the marginal reduction cost of industrial CO2 is CNY 4565/ton. The marginal reduction cost of CO2 varies by industry, with the textile industry being the highest and the petroleum, coking and nuclear fuel processing industries the lowest. Meanwhile, an increasing number of industries are shifting to cleaner production. Furthermore, the marginal reduction cost of industrial CO2 has an “inverted U-shaped” relation with carbon intensity. Carbon emission reduction can be accomplished effectively if the carbon intensity is kept below the threshold value of 0.41 tons/CNY 10,000.

Assessing Carbon Abatement Costs Considering Forest Carbon Sequestration and Carbon Offset Mechanism: Evidence from Taiwan

Abstract Based on the Greenhouse Gas Reduction and Management Act passed in 2015 and the carbon neutral target in 2050, Taiwan will most likely follow international trends by imposing carbon taxes and establishing carbon offset markets. The positive and negative effects of carbon taxes and carbon offset markets on the economy and the environment merit further investigation. Accordingly, this study adopted a carbon emission reduction (CER) cost prediction model to assess the carbon abatement costs under three scenarios: (1) a carbon offset market exists, and forest carbon sequestration can be used as carbon offsets; (2) a carbon offset market exists, but forest carbon sequestration cannot be used as carbon offsets; and (3) a carbon offset market does not exist. Forests in Taipei (with low carbon emissions) and Kaohsiung (with high carbon emissions) were selected as research sites to explore the benefits of carbon emissions trading and forest carbon sequestration. The results show that CER costs are the lowest in scenario 1 and are the highest in scenario 3. The CER costs of Kaohsiung are higher than those of Taipei. The higher the carbon price, the greater the difference in CER costs between the two cities. Study Implications: The objective of this study was to identify the optimal policy for Taiwan to effectively slow climate change. This study showed that the opening of carbon offset markets and the use of forest carbon sequestration as carbon offsets may prompt regions to increase their forest stock to lower their emission reduction costs. However, achieving 2050 carbon neutral target by solely using forest carbon sequestration is not sufficient in Taiwan.

Decisions for a Retailer-Led Low-Carbon Supply Chain Considering Altruistic Preference under Carbon Quota Policy

With the release of the national energy-saving emission reduction policy and the improvement of consumers’ awareness of environmental protection, the demand for low-carbon products is growing rapidly. In a retailer-led low-carbon supply chain, the increased cost of carbon emission reduction puts manufacturers at a disadvantage. Under the carbon quota policy, to improve manufacturers’ profits as well as enhance carbon emission reduction, this paper studies the players’ decisions in a low-carbon supply chain consisting of one dominant retailer and one manufacturer. To maintain the supply chain’s stability and sustainability, the dominant retailer tends to employ altruistic preference policies towards the manufacturer. The optimal decision, carbon emission reduction and supply chain profit are compared and analyzed under three decision models: (i) centralized decision, (ii) decentralized decision without altruistic preference and (iii) decentralized decision with altruistic preference. The results indicate that the carbon emission reduction rate, market demand and profit in the centralized model are higher than in the decentralized model. The retailer’s altruistic preference is beneficial to the improvement of carbon emission reduction, market demand and the profit of the manufacturer and the supply chain. Under certain conditions, carbon trading can effectively reduce the cost pressure of manufacturers and improve the level of carbon emission reduction and the overall profit of the supply chain. These results will guide low-carbon supply chain decision-making and provide insight into the research of irrational behaviors in supply chain decision-making under carbon policies.

Coordination Analysis of the Recycling and Remanufacturing Closed-Loop Supply Chain Considering Consumers’ Low Carbon Preference and Government Subsidy

Guided by the goals of carbon peaking and carbon neutrality, in order to coordinate the recycling and remanufacturing closed-loop supply chain (CLSC), considering the strengthened low-carbon awareness of consumers and the high cost of carbon emission reduction(CER), realizing that the demand of remanufactured product is affected by both market price and manufacturer’s CER effort and that the manufacturer is responsible for CER, this study focuses on the hybrid recycling between the manufacturer and retailer. Based on Stackelberg game theory, it constructs the profit models for various interested parties under centralized and decentralized decision-making models to study consumer low carbon preference coefficient and government CER subsidy coefficient, in order to work out the optimal pricing strategy and the level of manufacturer’s CER effort under two decision models, and designs a cost-and-benefit-sharing contract to coordinate the supply chain. The results show that: (1) total recycling amount and total profit under CLSC are negatively correlated with recycling channel competition coefficient; (2) government CER subsidy and consumers’ low carbon preference help enhance both total profit under CLSC and the zeal of manufacturers for CER; and (3) the parameters of contracts in some circumstances contribute to alleviating the competition between manufacturer and retailer cycling channels and increasing the total recycling amount under CLSC. Meanwhile, the profit for various interested parties and total profit under CLSC, and the level of a manufacturer’s CER effort, can be simultaneously improved. Consequently, the Pareto improvement and sustainable development for the CLSC can be achieved.

A Review of Carbon Emission Reduction Cost Research in China—Based on CiteSpace Knowledge Mapping Analysis

A Review of Carbon Emission Reduction Cost Research in China—Based on CiteSpace Knowledge Mapping Analysis

Information sharing and sales format strategy under platform economy and cap-and-trade

We develop a low-carbon supply chain including an online retail platform and a manufacturer, taking into account cap-and-trade mechanism. The online retail platform withholding the forecasting demand information chooses whether to share it or not and chooses the reseller format or the agency sales format. The manufacturer produces the low-carbon product and decides the carbon emission reduction level. Therefore, we establish two scenarios (non-information sharing; information sharing) in the reseller format model and the agency sales format model, respectively. Firstly, we derive the members’ equilibrium decisions and explore the online retail platform’s information sharing strategy. We find that the carbon emission reduction efficiency and sales format play important roles in information sharing strategy. Then, we examine the effects of information sharing strategy on carbon emission, consumer surplus, and social welfare. We find that sharing information is always beneficial to the environment, and may create more positive social value. Finally, we investigate sales format strategy and find that it depends on the carbon emission reduction cost.

Coordination mechanism of wooden furniture supply chains with consideration of carbon footprint

This study emphasizes a three-level wooden furniture supply chain, which involves one supplier, one manufacturer, and one retailer. Focusing on maximizing the profit of the supply chain while adhering to low-carbon principles, the Three-level Leader-follower Game (TLG) model, Stackelberg Game Model I (SGI model), Stackelberg Game Model II (SGlI model), and Cooperative Decision-making (CD) model were established by using game theory. The carbon emission reduction cost and benefit sharing contract was introduced into the model with the maximum profit, and the ranges of sharing coefficients for a solid wood bed supply chain and the optimal decision-making process for each supply chain member were discussed. Results showed that the profit for the solid wood bed supply chain reached maximum under the CD model, followed by the SGII model, and then the SGI model, and the TLG model showed the lowest profit. A higher preference for low-carbon products can lead to lower demand for products and higher retail prices. Through introducing the cost and benefit-sharing contract into the CD model, the profit of the supply chain can be guaranteed with different sharing coefficients, and the profit of each member was improved compared to the TLG model.

Research on the economic abatement pathway of carbon peaking in China based on marginal abatement costs and abatement tasks allocation.

China needs to achieve its carbon peaking target with minimal economic costs. This paper proposes a framework for achieving the carbon peaking target that emphasizes economic effects. Based on the prediction, the parametric directional distance function (DDF) is adopted to calculate the total factor carbon emission efficiency and marginal carbon abatement cost in each region of China before 2030, and the allocation scheme of the abatement tasks necessary for carbon peaking is optimized from the perspective of least cost. The empirical results show the following: (1) The predicted rapid growth of China's economy from 2020 to 2030 will lead to a rapid increase in marginal abatement costs, with the average marginal carbon abatement cost increasing from 8,833 yuan/ton to 15,077 yuan/ton. The cost of carbon emission reduction in the future is very expensive. (2) The measured marginal abatement costs in China are positively correlated with carbon emission efficiency. In order to ensure economic development, developed regions should try to maintain the development trend, while the central and western regions take on more emission reduction tasks. (3) The emission efficiency is improved by optimizing the allocation scheme of the abatement tasks required to reach the peak, and the scientific and orderly path to reach the peak of each province and the corresponding lowest economic cost are obtained. This paper are of great theoretical and practical significance for the initial quota allocation in carbon trading market and ensuring the achievement of carbon peaking target under economic effect.

Carbon Emission Reduction Cost Assessment Using Multiregional Computable General Equilibrium Model: Guangdong–Hong Kong–Macao Greater Bay Area

Carbon emissions reduction is an urgent global call to action, and for China, the nation with the largest carbon dioxide emissions, the task is especially arduous. For a country like China with many provinces and cities and unbalanced regional economic development, how to balance carbon emission reduction targets with economic development goals has become a social concern. Estimating the emission reduction costs of economic entities at all levels and reasonably allocating emission reduction tasks are the basic prerequisites for sustainable urban development. Based on an input–output (IO) table analysis of the socioeconomic data of Guangdong Province from 2017, this paper uses RAS and other data reconciliation methods to decompose various statistical data based on cities and industries. A multiregional IO table of nine cities in Guangdong Province in the Guangdong–Hong Kong–Macao Greater Bay Area (GBA) is obtained, and a multiregional computable general equilibrium (CGE) model of Guangdong Province is established. Using this model, this paper explores city-level differences in carbon emissions reduction costs while accounting for differences in economic development under industry-wide coverage. A scientific basis for the allocation of urban carbon quotas is provided, which is particularly important for the sustainable development of cities. First, the carbon emissions reduction cost (carbon price) of each city is related to the intensity of emissions reduction and the present carbon intensity, both of which are affected by cities’ industrial and trade structures. Second, under neoclassical closure conditions, carbon emissions reduction is found to have less impact on the overall gross domestic product (GDP). At the industrial level, the high-carbon sectors are the most affected, whereas the low-carbon sectors are less affected. Notably, some industries become beneficiary sectors. Under Keynesian closure conditions, carbon emissions reduction has a greater impact on overall GDP, and all cities and industries are generally affected, especially those that are currently carbon- and trade-intensive. Third, to ensure the achievement of emissions reduction targets and minimize negative economic impacts, it is determined that the direct and opportunity costs of carbon emissions reduction must be fully considered when allocating carbon allowances, and optimal solutions should be derived from the combined perspective of fairness and efficiency.

Research on Carbon Emission Reduction Investment Decision of Power Energy Supply Chain—Based on the Analysis of Carbon Trading and Carbon Subsidy Policies

This study examines the carbon reduction investment decisions of the electric power energy supply chain considering carbon trading and carbon subsidy policies in China’s “dual carbon” context. By building a three-level supply chain system including electric power producers, retailers, and consumers, we discuss the optimal decision-making problem of the supply chain for three models of decentralized supply chain decision making without government subsidies, centralized supply chain decision making with government subsidies, and centralized supply chain decision making with government subsidies and carbon emission reduction cost sharing. Through model solving and further numerical simulations, the results showed that the increase in carbon emission reduction investment cost has a significant negative impact on power price and the total expected income of the supply chain. However, a reasonable level of government carbon emission reduction subsidy can effectively alleviate the increase in power price and improve the total expected income of supply chain. In addition, carbon mission reduction investment and supply chain cost allocation can effectively improve the carbon emission reduction level of the power supply chain, improve the income and enthusiasm of electric power producers, and realize the sustainable development of electric power energy consumption and the environment.

Research on the cost effectiveness of carbon emission reduction in the full life cycle of electric vehicles based on grey prediction

In order to research the carbon emission reduction potential of electric vehicles, a cost effectiveness model is used to calculate and compare the economic costs and carbon emissions of fuel vehicles and electric vehicles throughout the life cycle, and an improved grey prediction model is utilized to analyze the future trends of electric vehicle emission reduction benefits. The results show that electric vehicles play a positive role in carbon emission reduction, and the unit cost of carbon emission reduction is decreasing by years. Therefore, China should vigorously develop the electric vehicle industry and technology, and achieve the strategic goal of carbon emission reduction by promoting the electrification of vehicles.

Research on the heterogeneous impact of carbon emission reduction policy on R&D investment intensity: From the perspective of enterprise's ownership structure

Confronted with the constraints of carbon dioxide reduction, R&D improves the production efficiency of enterprises. However, China's diversified economic entity structure makes enterprises with different attributes exhibit different R&D behaviors under the constraints of external carbon dioxide reduction. This paper takes Ten Thousand Enterprises Plan as an example, which belongs to the front-end policy and restricts the enterprise's carbon emission rights, reveals the impact of carbon dioxide reduction constraint on enterprises' R&D investment and alleviates the endogenous bias of previous research. Moreover, this paper explores the moderating effect of ownership structure on the relationship between carbon dioxide reduction policy and enterprises' R&D investment. The results show that the relationship between carbon reduction policy and enterprises' R&D investment in China is manifested as a significant “cost effect”, that is, mandatory carbon emission reduction policy limits the expansion of enterprises' R&D investment scale. Comparing state-owned enterprises with non-state-owned enterprises, carbon dioxide reduction policy can hardly stimulate the R&D investment in non-state-owned enterprises, while the state-owned enterprises can easily obtain factor resources, which decreases carbon emission reduction costs and improve R&D investment intention, resulting in stronger R&D behaviors.

Carbon Emission Reduction Decision and Revenue-Sharing Contract with Consumers’ Low-Carbon Preference and CER Cost under Carbon Tax

Since the tax of carbon emission is popular and consumers are exhibiting low-carbon preference, the green manufactures have to spend more extra cost on investing carbon emission reduction (CER) technology to decrease the carbon emission. To encourage the manufacture’s CER investment efforts, this paper explores the impact of carbon tax, CER cost, and consumers’ low-carbon preference on low-carbon decision-making and designs a revenue-sharing contract (RS) by constructing Stackelberg models. Based on the theoretical and numerical analysis, this paper finds that the supply chain would benefit from the increment of consumer’s environmental awareness but be depressed by the increase of the CER investment cost factor. Additionally, there exists a unique optimal carbon tax to make CER degree the maximum. Furthermore, RS can effectively promote manufacturers to reduce carbon emissions and also improve the supply chain efficiency.

Supply chain carbon emission reductions and coordination when consumers have a strong preference for low-carbon products

Owing to the rising concerns about environmental degradation worldwide, firms in several developed and developing countries are pursuing carbon emission reduction targets. In addition, in recent years, there is evidence of a shift in consumer preferences in favour of low-carbon products. Using a theoretical model, where the shift in consumer preferences is explicitly incorporated, we evaluate the impact of carbon emission reduction cost-sharing on supply chain profit. In our model, consumers are willing to pay a higher price for low-carbon products and hence the retailer considers sharing the cost of carbon emission reduction with the manufacturer. Our model also includes a carbon trading mechanism. We identify a range of carbon emission reduction cost-sharing such that both supply chain enterprises are better-off. We find that, while achieving the aim of carbon emission reduction, consumer preference for low-carbon products can benefit both supply chain enterprises. Numerical simulations show that carbon emission reduction cost-sharing increases the retailer's order quantity as well as the profit and hence there is an incentive for the two supply chain enterprises to cooperate.

Carbon-Oriented Electricity Network Planning and Transformation

The acceleration of distributed energy resources and carbon pricing policies have compelled utilities to act and to prioritize carbon-constrained infrastructure augmentation in their capital programs. To implement various carbon emission reduction policies, power system transmission planning has become more challenging. The existing energy system will face massive retirement of coal-fired power plants (CFPPs), large scale integration of renewable energy and network expansion. In this paper, an electricity network planning and transformation roadmap, which has two milestones, is put forward. In the first stage, a mathematical model is proposed based on the average cost of carbon emission reduction to realize the cooperation of CFPPs retirement and renewable energy investment. It can help the network carry out the transition from a fossil-fuel dominated system to a low-carbon oriented system. Because of the promising prospect of power-to-gas (P2G) technology, in the second milestone, a method based on carbon emission flow (CEF) is employed to help the power-to-gas stations (P2GSes) to select the construction site and capacity. The gas network constraints are modeled to guarantee that P2GSes can work smoothly without energy flow congestion in both electricity and gas networks. According to the simulation results in case studies, our method can reach the emission reduction target more economically and effectively, and the P2GSes can produce and absorb clean energy.