Emission Reduction Cost Research Articles

Economic and scale prediction of CO2 capture, utilization and storage technologies in China

In response to the lack of global quantitative research on the potential and scale prediction of CO2 capture, utilization and storage (CCUS) in China under the background of carbon peak and carbon neutrality goals, this study predicts the future economic costs of different links of CCUS technologies and the carbon capture needs of different industries in the scenario of fossil energy continuation. Based on the CO2 utilization and storage potential and spatial distribution in China, a cost-scale calculation model for different regions in China in 2060 is constructed to predict the whole-process economic cost and its corresponding scale potential of CCUS. The results show that a local + remote storage mode is preferred, together with a local utilization mode, to meet China's 27×108 t/a CO2 emission reduction demand under the scenario of fossil energy continuation. Specifically, about 5×108 t CO2 emission is reduced by capture utilization, and the whole-process cost is about −1400–200 RMB/t; about 22×108 t CO2 emission is reduced by capture storage, and the whole-process cost is about 200–450 RMB/t. According to the model results, it is recommended to develop the chemical utilization industry based on P2X (Power to X, where X is raw material) technology, construct the CCUS industrial cluster, and explore a multi-party win-win cooperation mode. A scheme of national trunk pipeline network connecting areas connecting intensive emission reduction demand areas and target storage areas is suggested. The emission reduction cost of thermal power based on CCUS is calculated to be 0.16 RMB/(kW·h).

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.

Dynamic strategies of horizontal low-carbon supply chains under double carbon policies: A bounded rationality perspective

Under double carbon policies, this study proposes a horizontal low-carbon supply chain involving a traditional manufacturer and a low-carbon manufacturer. On this basis, we develop two scenarios, which differ in whether the traditional manufacturer adopts green technology or not. Considering bounded rationality, we explore the dynamic production and emission reduction strategies in the two scenarios by using game theory and chaos theory. The results show that manufacturers’ adjustment speeds have great effects on equilibrium strategies, with chaos and other complex phenomena emerging in certain cases. For both manufacturers, the increase of the emission reduction adjustment speed shrinks stable regions of their production strategies, and an excessive adjustment strategy always harms its own profit but brings benefits to the competitor. By comparing the results of the two scenarios, the conditions for the traditional manufacturer to adopt green technology can be concluded as a relatively low unit emission reduction cost and a suitable low-carbon competitive intensity. When these conditions are satisfied, the production, emission reduction, and profit of the low-carbon manufacturer will all decrease. Finally, we provide useful guidance in promoting low-carbon development.

Strategies of property developers in the context of carbon tax.

China needs to guide property developers in actively reducing emissions to reach carbon emission reduction targets and respond to global climate change. A carbon tax is an important policy tool. Still, to establish successful rules to steer property developers' reasonable carbon emission reduction behavior, we must first explore property developers' decision-making mechanisms. This study develops an emission reduction and price game model for property developers under the constraint of a carbon tax. It then applies reverse order induction and optimization methods to identify the game equilibrium solution for property developers. Using the game equilibria, we explore the carbon tax mechanism on emission reduction and property developer pricing strategies. We can derive the following conclusions if the carbon tax policy is not implemented: 1.House prices are related to the substitutability of the two types of competitive property developers. 2.The greater the substitutability, the greater the cost of emission reduction paid by consumers. 3.The game equilibrium carbon emission intensity is the average carbon emission intensity of the housing business. In the situation of enacting a carbon tax, we arrive at the following conclusions: 1.The profits of real estate developers who do not have the advantage of emission reduction continue to decline with the increase of carbon tax. 2. For real estate developers who have the advantage of decreasing emissions, profits declined initially and then increased as the carbon tax rate increased, and only when the carbon tax rate reaches Tm1* can they fully leverage the cost advantage and obtain ever-increasing profits. 3.Low tax rates should be adopted by the government at the start of the implementation of the carbon tax policy to provide a buffer time for real estate developers who do not have the advantage of emission reduction costs.

Atmospheric ammonia in China: Long-term spatiotemporal variation, urban-rural gradient, and influencing factors

In recent years, atmospheric ammonia (NH3) concentrations have increased in China. Ammonia control has become one of the next hot topics in air pollution mitigation with the increasing cost of acid gas emission reduction. In this study, using Infrared Atmospheric Sounding Interferometer (IASI) satellite observations, we analyzed the spatiotemporal distribution, the urban-rural gradient of the vertical column densities (VCDs) of NH3 and the contribution of influencing factors (meteorology, social, atmospheric acid gases, and NH3 emissions) in China from 2008 to 2019 using hotspot analysis, circular gradient analysis, geographical and temporal weighted regression, and some other methods. Our results showed that NH3 VCDs in China have significantly increased (31.88 %) from 2008 to 2019, with the highest occurring in North China Plain. The average NH3 VCDs in urban areas were significantly higher than those in rural areas, and the urban-rural gap in NH3 VCDs was widening. The results of circular gradient analysis showed an overall decreasing trend in NH3 VCDs along the urban-rural gradient. We used a geographically and temporally weighted regression model to analyze the contribution of various influencing factors to NH3 VCDs: meteorology (30.13 %), social (27.40 %), atmospheric acid gases (23.20 %), and NH3 emissions (19.28 %) factors. The results showed substantial spatiotemporal differences in the influencing factors. Atmospheric acid gas was the main reason for the increase in NH3 VCDs from 2008 to 2019. A more thorough understanding of the spatiotemporal distribution, urban-rural variations, and factors influencing NH3 in China will aid in developing control strategies to reduce PM2.5.

Manufacturers' emission reduction investment strategy under carbon cap-and-trade policy and uncertain low-carbon preferences

PurposeThis paper aims to find optimal emission reduction investment strategies for the manufacturer and examine the effects of carbon cap-and-trade policy and uncertain low-carbon preferences on emission reduction investment strategies.Design/methodology/approachThis paper studied a supply chain consisting of one manufacturer and one retailer, in which the manufacturer is responsible for emission reduction investment. The manufacturer has two emission reduction investment strategies: (1) invest in traditional emission reduction technologies only in the production process and (2) increase investment in smart supply chain technologies in the use process. Then, three different Stackelberg game models are developed to explore the benefits of the manufacturer in different cases. Finally, this paper coordinates between the manufacturer and the retailer by developing a revenue-sharing contract.FindingsThe manufacturer's optimal emission reduction strategy is dynamic. When consumers' low-carbon preferences are low and the government implements a carbon cap-and-trade policy, the manufacturer can obtain the highest profit by increasing the emission reduction investment in the use process. The carbon cap-and-trade policy can encourage the manufacturer to reduce emissions only when the initial carbon emission is low. The emission reduction, order quantity and the manufacturer's profit increase with the consumers' low-carbon preferences. And the manufacturer can adjust the emission reduction investment according to the emission reduction cost coefficient in two processes.Originality/valueThis paper considers the investment of emission reduction technologies in different processes and provides theoretical guidance for manufacturers to make a low-carbon transformation. Furthermore, the paper provides suggestions for governments to effectively implement carbon cap-and-trade policy.

Comparative analysis of subsidy and fee policies for construction equipment emissions reduction

Subsidies can incentivize contractors to replace old high-emitting construction equipment, but may put a financial burden on the government. A combination of fee and subsidy policy is regarded as cost-effective, but limited research was conducted on construction equipment. For this, the study sets up different scenarios to simulate the policies influencing contractors' selection of construction equipment. It also compares emissions reduction and government cost under different policy scenarios. The results of the earthwork case study in a Hong Kong public project show that the combined policy of fee and subsidy can achieve the same emission reductions of particulate matter (19.52 kg) and nitrogen oxide (83.78 kg) at a lower subsidy level (HK$3967) than the subsidy-only policy (HK$7934). The reduction of particulate matter and nitrogen oxide emissions is 0.59 kg and 68.45 kg through the fee-only policy, which is less than the combined policy. The sensitivity analysis results indicate that the contractor's budget can influence the government cost, and the different level of subsidy and fee can influence the emissions reductions. It is suggested that the implementation strategy of the combined policy should consider the budgets of contractors and governments. The proposed methods and findings can provide decision-making references for reducing emissions from construction equipment in different economies.

Research on technical route and economic calculation of solar assisted carbon capture system

This paper takes a 600MW supercritical unit as the research object, and studies the technical route and economic situation of solar photothermal system as the heat source of reboiler of carbon capture system. Taking Monoethanolamine (MEA) as the research object to analyse its desorption energy consumption characteristics, the calculation results show that the carbon capture and regeneration energy consumption of the system is 3.90Gj/t CO2, calculated by the CO2 absorption rate of 85%. Three technical routes of solar assisted carbon capture systems are proposed, and the main thermal economic indexes of the two methods, such as unit coal consumption and thermal efficiency, using the fifth stage extraction steam as an independent heat source and cooperating with the solar photothermal system, are calculated and compared respectively. Based on this, the influence of investment cost and collector area on CO2 emission reduction cost and coal consumption is analysed. The results show that after adding the solar thermal system, the coal consumption of the unit is reduced by 2.5g/(kw) compared with the pure steam extraction heating unit and the thermal efficiency is increased by 0.9%. The CO2 emission reduction cost has a positive correlation trend with the investment cost, and the unit coal consumption has a negative correlation trend with the increase of the collector area.

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.

Scenario assessment of introducing carbon utilization and carbon removal technologies considering future technological transition based on renewable energy and direct air capture

Carbon capture and utilization (CCU) and carbon dioxide removal (CDR) technologies have the potential to significantly contribute to GHG reduction. Numerous studies have evaluated the CO2 reduction effects and economics of CCUs and CDRs; however, uncertainties in these evaluations due to various regional characterizations and future technological transitions are of high importance. In this study, four synthetic fuels (fuels produced from captured CO2 and H2), methanol, methane, gasoline, and diesel, were evaluated by life cycle assessment (LCA) and techno-economic assessment (TEA). Five representative countries with different regional characteristics were selected for the study. A bottom-up integrated LCA/TEA approach was used, involving detailed process simulations to avoid uncertainties and to evaluate future technological transitions based on direct air capture (DAC) and renewable energy. The overarching objective of this study was to provide a transparent framework with a common dataset generation methodology to determine the countries that have the advantages/disadvantages in synthetic fuel production and sale, considering the local operational parameters and large-scale introduction of DAC/renewable energy. Such multiple synthetic fuel analyses across various jurisdictions have not been conducted in previous studies. The results showed that the highest and lowest CO2 reductions were achieved by diesel (average 6.33 kg-CO2·kg−1) and methanol (average 3.43 kg-CO2·kg−1), respectively, whereas the highest and lowest product costs were of gasoline (average 2.96 USD·kg−1) and methanol (average 0.82 USD·kg−1), respectively. The technological transition using DAC and renewable energy showed average CO2 emission reductions of 47% (methanol), 99% (methane), 545% (gasoline), and 621% (diesel). Moreover, in the future, the lowest CO2 emission reduction costs are expected in Germany for methanol and diesel, Australia for methane, and Canada for gasoline. These findings can contribute to improving international collaboration to promote CCU and CDR technologies.

Quantum game perspective on green product optimal pricing under emission reduction cooperation of dual-channel supply chain

PurposeFrom the quantum game perspective, this paper aims to study a green product optimal pricing problem of the dual-channel supply chain under the cooperation of the retailer and manufacturer to reduce carbon emissions.Design/methodology/approachThe decentralized and centralized decision-making optimal prices and profits are obtained by establishing the classical and quantum game models. Then the classical game and quantum game are compared.FindingsWhen the quantum entanglement is greater than 0, the selling prices of the quantum model are higher than the classical model. Through theoretical research and numerical analysis results, centralized decision-making is more economical and efficient than decentralized decision-making. Publicity and education on carbon emission reduction for consumers will help consumers accept carbon emission reduction products with slightly higher prices. When the emission reduction increases too fast, the cost of emission reduction will form a significant burden and affect the profits of manufacturers and supply chain systems.Originality/valueFrom the perspective of the quantum game, the author explores the optimal prices of green product and compares them with the classical game.

Incentive Mechanism Analysis of Environmental Governance Using Multitask Principal–Agent Model

In view of the principal–agent relationship between local government and pollution enterprise in environmental governance, this paper established a multitask principal–agent model, gave the optimal contract form of local government incentive to enterprises, examined the influencing factors of the optimal incentive contract, and focused on analyzing the influences of institutional factors, enterprise types and enterprise attributes on the optimal incentive contract. The results show that the optimal incentive contract is affected by the influence coefficient of enterprise economic benefits on local government revenue, the environmental index weight in government performance systems, the types of enterprise, the risk preference of enterprise, the variance in economic benefits, the variance in pollution emission reduction, the ability of economic benefits, the direct cost of emission reduction and the economic cost (income) of emission reduction. In order to realize the coordinated development of economy and environment, the establishment and adjustment of optimal incentive contract should be established or adjusted according to the institutional factors, different types of enterprise, and the enterprise characteristics. Local governments should divide enterprises into traditional enterprises and green innovative enterprises in the process of management. The policy formulation of the local government should be based on the characteristics of the system and cooperate with the national strategy. Local governments should actively collect and master the attribute information of the enterprises, including risk preference, profit model, pollution control technology and ability, management experience and level, production mode and green innovation ability. Local governments should combine the types of enterprises, the characteristics of institutions and the attributes of enterprises, and adjust various policies and measures more flexibly.

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.

Spatial and Temporal Distribution Characteristics of Ozone Concentration and Population Health Benefit Assessment in the Yangtze River Delta Region from 2017 to 2020

In recent years, the ozone (O3) concentration has showed a rising trend in China, becoming second only to PM2.5 as an important factor affecting air quality. To grasp the spatial-temporal variations characteristics of O3 and the associated health impacts during the implementation of the three-year plan on defending the blue sky in the Yangtze River Delta (YRD) region, data collected from 210 monitoring stations in the YRD from 2017 to 2020 were analyzed using the global Moran's index and Getis-Ord Gi* index methods, and the associated health benefits of reduced O3 exposure were evaluated using the health risk and environmental value assessment methods. The results showed that during the study period, the interquartile range (IQR) of the annual average O3 concentration and that of the warm season both presented a declining trend. The average O3 concentrations in both warm and cold seasons showed a similar spatial distribution pattern, with the northern part exhibiting the higher concentrations and the southern part showing the lower concentrations. Furthermore, the O3 concentrations in the warm season were characterized by high O3 concentrations clustering in the northern and central part of the region. The proportion of the population exposure to annual average O3 concentration over 160 μg·m-3 decreased from 72.3% in 2017 to 34.8% in 2020 in the YRD. Although the population-weighted annual mean O3 concentration in the whole YRD region showed a downward trend, some cities in western Anhui province, northern Jiangsu province, and central Jiangsu province showed fluctuations and even an increasing trend. In terms of health benefits, there were 3782 cases (95% CI:2050-5511 cases) of avoided premature deaths associated with reduced O3 concentrations in the warm season in 2020 compared to 2017. The total health benefit was 26198 million yuan (95% CI:14201-38175 million yuan). Compared to the cost of the main O3 precursor emission reduction, the cost-benefits ratio was 1:1.67 to 3.23.

Retailer involvement in carbon emission reduction under the Cap-and-Trade mechanism

ABSTRACT Under the ‘ Cap-and-Trade’ mechanism of carbon emission, the low carbon management of supply chain is an indispensable link in the process of enterprise emission reduction. Constrained by carbon price and consumers’ environmental awareness, this paper establishes a two-stage game model between retailers and manufacturers under decentralized and centralized decisions. Under the decentralized decision, this paper analyzes the optimal carbon emissions before and after the transfer, the conditions of transfer and the changes of profits with the proportion of transfer. Under the centralized decision, Nash equilibrium is used to study the distribution of additional profits. Conclusions are obtained as follows. (a) There are thresholds for carbon price and consumers’ environmental awareness on carbon emissions, and the optimal emissions on both sides of the threshold will vary with the cost of emission reduction. (b) In a decentralized decision, the participation of retailers in abatement depends on the market abatement costs and abatement benefits, while a certain range of transfer rates can optimize the profitability of retailers. (c) In the centralized decision, manufacturer and retailer formulate emission reduction strategies jointly and share the extra profits equally.

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.

Optimization of low-carbon hydrogen supply chain networks in industrial clusters

This work presented an optimization-based model to aid in designing and planning a hydrogen supply chain network (HSCN) under different CO2 emission mitigation policies. The novelty of this approach lies in simultaneously, 1) tracking the resources available in HSCN and 2) designing the spatial interaction production, storage, and transportation. The model was formulated as a Mixed Integer Linear Program (MILP) to identify the minimum cost of HSCN. A case study was solved to assess the techno-economic performance of grey, blue and green hydrogen production while accounting for transport and the full energy system. A Pareto-curve was constructed to understand the trade-off between the Levelized cost of Hydrogen and emission reduction. The model also enabled the investigation of various long-distance hydrogen transport schemes; hydrogen transported as ammonia will cost 19% less than the other alternatives (liquid hydrogen, and liquid organic hydrogen carrier).

Promoting Port Emission Reduction: A Tripartite Evolutionary Game Analysis

Port emission reduction (PER) has attracted more and more attention, and promoting PER involves multiple stakeholders. Therefore, based on the evolutionary game theory, this paper establishes a tripartite evolutionary game model involving the government, port enterprise, and port residents, to explore the key variables affecting the implementation of emission reduction measures by the port enterprise. It is found that, in the initial stage of PER, because of the huge emission reduction cost, the government’s incentive policies and the potential losses brought by port residents’ supervision are the driving forces to promote the port enterprises to implement emission reduction measures. In the intermediate stage and mature stage of the development of PER, with the development of emission reduction technology, the emission reduction cost of port enterprises will be reduced, and the incremental income after emission reduction will gradually make up for part of the input cost. At this time, the government can reduce or even cancel relevant subsidies and finally withdraw from the market, and the willingness of port residents to choose supervision will be reduced, then the whole tripartite evolutionary game has reached an evolutionary stable state. In addition, we also provide some management insights for policymakers based on the results of sensitivity analysis of relevant parameters affecting the evolution path of the tripartite game.

Price and Portcall Frequency Competition in Sea-and-Land transportation supply chain under Carbon Emission Reduction Target

For carbon emission reduction by ports and shipping lines under sea-and-land transportation mode, to build a two-stage transportation supply chain model consisting of two competing ports and one shipping line The profit functions of ports and shipping lines were established to analyze the impact of parameters which are port emission reduction level, port unit emission reduction cost and the proportion of emission reduction cost shared by ports to shipping lines on port handling pricing, portcalls of shipping line and respective profits. The results show that the port emission reduction level and port unit emission reduction cost have a significant impact on decision variables and profits. Conversely, there is no significant impact on the proportion of emission reduction cost shared by ports to shipping lines. Within a certain range, port handling pricing increases as the port emission reduction level and port unit emission reduction cost increase. On the contrary, portcalls of shipping line decreases and individual profits decrease as parameters increase.

How does carbon emissions trading scheme affect emission reduction decisions of coal-fired power plants? An evolutionary game theoretic perspective

Carbon emissions trading scheme (CETS) is widely regarded as a cost-effective marketbased regulation for carbon abatement. In the context of CETS, this study develops an evolutionary game model that incorporates two representative coal-fired power plants and a government. Our model captures the interplay of emission reduction strategies between coal-fired power plants and endogenously incorporates government regulatory decisions. We analyze the strategic decisions of coal-fired power plants by discussing the dynamics and equilibrium of the game. Our findings demonstrate that in the absence of government implementation of CETS, coal-fired power plants refrain from investing in carbon abatement. However, with the enforcement of CETS, along with sufficient penalties for excessive carbon emissions, coal-fired power plants become inclined to invest in emission reduction. Furthermore, the willingness of coal-fired power plants to invest in carbon abatement exhibits a negative relationship with both the quota and the cost of emission reduction.