Cap-and-trade Research Articles

Use of agricultural by-products in the development of an agro-energy chain: A case study from the Umbria region

Use of agricultural and livestock by-products for anaerobic digestion (AD), in total or partial substitution of the maize silage was evaluated from an environmental and economical point of view. The evaluation process included three methodological interdependent and consequential steps: the chemical stage at laboratory and plant level, the environmental and economic steps developing the Life Cycle Assessment and Life Cycle Costing jointly. The laboratory test showed that the two mixtures prepared with by-products, in partial (MIX A) and total (MIX B) substitution of maize silage, did not show differences in bio-methane production compared to a reference mixture with the 33% of maize silage. All mixtures tested at full-scale plant, showed the same performances, resulting in a similar energy production. Environmentally, MIX B increased greenhouse gas credits derived from the avoided production of mineral fertiliser for the energetic crops, resulting also in better economic performances. The break-even transport distances follow the positive environmental pattern result, in contrast to what was found for the break-even transport distances from the economic point of view.

The role of government in operationalising markets for REDD + in Indonesia

The global climate initiative Reducing Emissions from Deforestation and Forest Degradation (REDD+) initially included carbon markets as one potential policy mechanism to finance a range of forestry projects in developing countries. Indonesia was an early leader on REDD+, and set up the regulatory frameworks and monitoring systems to support demonstration projects that could trade credits in voluntary carbon markets. This article applies a neoliberal governmentality framework to evaluate the development of REDD+ market institutions in Indonesia during the Readiness period between 2008 and 2013. It critiques the role of the state in this process, and how the authority of public agencies shapes the actions of private subjects. The case of Indonesia indicates a pivotal role for government agencies at multiple levels in integrating the operation of REDD+ market activities within a supportive regime of forest and land management. Critical to this process was legislation to trade in forest carbon and obtain project licenses, devolved land-use planning and forest management that could support commercial activities, and robust MRV surveillance systems to oversee on-ground activities. Despite these efforts, projects were often subject to an uncertain and highly contested forest management regime, undermining attempts to demonstrate the viability of operationalising market mechanisms at the local scale.

A strategic approach to selecting policy mechanisms for addressing coal mine methane emissions: A case study on Kazakhstan

Coal production globally is projected to grow in the foreseeable future. Countries with heavy reliance on coal could reduce methane and other emissions through the capture and utilization of coal mine methane (CMM) in the short and medium term, while they pursue structural and long-term economic changes. Several countries have successfully implemented policies to promote CMM capture and utilization; however, some countries still struggle to implement projects. This paper outlines key factors to consider in adapting policies for CMM mitigation. The authors propose an approach for selecting adequate mechanisms for stimulating CMM mitigation that involves reviewing global best practices and categorizing them functionally either as mechanisms needed to improve the underlying conditions or as CMM-specific policies. It is important to understand local policy frameworks and to consider whether it is more feasible to improve underlying policy conditions or to provide targeted incentives as an interim measure.Using Kazakhstan as a case study, the authors demonstrate how policymakers could assess the overall policy framework to find the most promising options to facilitate CMM projects. Kazakhstan’s emissions from underground coal mines have been increasing both in total and per tonne of coal production, while overall production has been declining. CMM mitigation presents an opportunity for the country to reduce its greenhouse gas emissions in the near and medium term, while the government pursues sustainable development goals. Analysis shows that policymakers in Kazakhstan can leverage existing policies to stimulate utilization by extending feed-in tariffs to cover CMM and by developing working methodologies for companies to obtain emission reduction credits from CMM projects.

Reforming global carbon markets or re-imagining alternative climate solutions and sustainabilities? An analysis of selected NGO strategies in Uganda

Abstract Carbon markets have emerged globally as a central feature in market based strategies to address the climate crisis. Global trade in carbon is based on the premise that it is possible to reduce global greenhouse gas emissions and stabilise the earth's climate, while at the same time generating new forms of capital accumulation. Amongst carbon market initiatives includes Reduction of Emissions from Deforestation and Degradation (REDD) type projects, that connect peasant and subsistence farmers in the south with northern consumers and industries. These projects are expanding on the African continent, giving rise to social, economic and ecological impacts. In this article we chart the responses of social movements to carbon markets. Through a study of selected NGOs active in carbon market campaigns in Uganda, we examine the strategies and tactics of movements in responding to the expanding carbon economy. Our findings demonstrate NGOs' approaches move between, and across, reformist and rebel (or radical) change agendas. Dominant strategies are directed towards reforming carbon markets and associated forestry governance. Meanwhile, a rebel, or radical change agenda – including rejecting the language and ideology of carbon trade, alongside building autonomous local level rights based movements – emerges in the constrained spaces of both privatised green economic governance and a militarised state. Given the constrained opportunities for radical movement organising, and the frequent institutionalization and limited influence of NGOs, increasing understandings of these radical change agendas and their contributions for re-imagining alternative sustainabilities is significant for scholars, activists and practitioners alike. Key words: Carbon markets, REDD, Uganda, alternative sustainabilities

Industrial Wastes and By‐products as Alternative Fuels in Cement Plants: Evaluation of an Industrial Symbiosis Option

SummaryA ravenous fuel consumer, the cement industry may substitute fossil fuels by industrial wastes and by‐products, identifying the industry as a key example of industrial symbiosis (IS). Benefits from industrial waste alternative fuels (IWAFs) include safe disposal, fossil fuel cost savings, gate fees, and greenhouse gas credits. Poor IWAFs, (high moisture, ash and halogen content) bring higher gate fees, but lessen clinker production. Thermal rating and blower capacity constraints should be satisfied in such a case study of IS. Cement plants must comply with potentially tighter emission limits, compared to fossil fuel utilization, despite higher pollutant precursors in IWAFs. Emissions’ compliance, operational, and production implications are a few among several challenges when assessing multiple IWAF valorization as a symbiotic option from a systems’ perspective. A novel method is proposed to quantitatively assess critical trade‐offs. Species and energy transformations convey a rigorous picture of clinker level, kiln flue gas, and offgas volumes and lay the groundwork for screening, a priori selection, and process tuning. Necessary and sufficient compliance conditions and safety margins are presented in terms of process parameters and actual emissions’ data. Main challenges posed by high flue gas, high offgas volumes, high moisture, low heating value, increased nitrogen oxides emissions, and high halogen and metal content are quantified. As demonstrated in a case study of an actual 1.5 × 106 tonnes per annum clinker plant in this paper, concurrent use of several IWAFs may increase clinker production, while satisfying operational constraints and maintaining compliance. The method may serve for devising IWAF preparation, or tuning mechanisms expanding IWAF valorization.

Life Cycle Inventory Analysis of the Wood Pallet Repair Process in the United States

SummaryThis study developed gate‐to‐gate life cycle inventory (LCI) data for the repair of 48 by 40 inch (1,219 by 1,016 millimeter [mm]) stringer‐class wood pallets in the United States. Data were collected from seven wood pallet repair facilities. Approximately 1.98 FBM (foot, board measure) (4.67E‐03 cubic meters) of lumber were used for repairing each 48 by 40 inch (1,219 by 1,016 mm) stringer‐class wood pallet, the majority (97%) recovered from damaged pallets received by the pallet repair facilities. Repair equipment powered by electricity made the largest contribution to greenhouse gas (GHG) emissions. Steel nails used for the pallet repair had the largest contribution to GHG emissions among the material inputs, while use of recovered lumber yielded the largest GHG emissions credits. Overall, the repair process for a 48 by 40 inch (1,219 by 1,016 mm) stringer‐class wood pallet had GHG credits rather than a positive GHG emission due to the GHG offsets from co‐products.

The impact of shale gas on the costs of climate policy

ABSTRACTThe use of shale gas is commonly considered as a low-cost option for meeting ambitious climate policy targets. This article explores global and country-specific effects of increasing global shale gas exploitation on the energy markets, on greenhouse gas emissions, and on mitigation costs. The global techno-economic partial equilibrium model POLES (Prospective Outlook on Long-term Energy Systems) is employed to compare policies which limit global warming to 2°C and baseline scenarios when the availability of shale gas is either high or low. According to the simulation results, a high availability of shale gas has rather small effects on the costs of meeting climate targets in the medium and long term. In the long term, a higher availability of shale gas increases baseline emissions of greenhouse gases for most countries and for the world, and leads to higher compliance costs for most, but not all, countries. Allowing for global trading of emission certificates does not alter these general results. In sum, these findings cast doubt on shale gas’s potential as a low-cost option for meeting ambitious global climate targets.POLICY RELEVANCEMany countries with a large shale gas resource base consider the expansion of local shale gas extraction as an option to reduce their GHG emissions. The findings in this article imply that a higher availability of shale gas in these countries might actually increase emissions and mitigation costs for these countries and also for the world. An increase in shale gas extraction may spur a switch from coal to gas electricity generation, thus lowering emissions. At the global level and for many countries, though, this effect is more than offset by a crowding out of renewable and nuclear energy carriers, and by lower energy prices, leading to higher emissions and higher mitigation costs in turn. These findings would warrant a re-evaluation of the climate strategy in most countries relying on the exploitation of shale gas to meet their climate targets.

Examining the impacts of Feed-in-Tariff and the Clean Development Mechanism on Korea's renewable energy projects through comparative investment analysis

Renewable energy projects in Korea have two avenues that provide subsidies to increase their financial viability. Feed-in-Tariffs (FITs) offer cost based prices for renewable electricity to compete with conventional energy producers. The Clean Development Mechanism (CDM) issues certified emission reduction (CER) credits that generate additional revenues, enhancing renewable projects’ return on investment. This study investigated how these subsidies impact the financial returns on Korea's CDM projects. An investment analysis was performed on four cases including solar, hydropower, wind and landfill gas projects. Revenues from electricity sales, FITs and CERs were compared using financial indicators to measure their relative contributions on profitability. Results indicate that CDM is partial towards large scale projects with high emission reductions. Moreover, conflicts with FIT schemes can deter small scale, capital intensive projects from pursuing registration. The analysis highlights CDM's bias for particular project types, which is in part due to its impartiality towards carbon credit prices. It also reveals that Korea, a key benefactor of CDM, is susceptible to such biases, as demonstrated by the disproportionate distribution of issued CERs. Improving incentives for bundled, small scale projects, CER price differentiation, and excluding domestic subsidies during additionality testing are proposed as possible reforms.

Mechanisms of dust grain charging in plasma with allowance for electron emission processes

The process of dust grain charging is described with allowance for secondary, ion-induced, photoelectric, and thermal electron emission from the grain surface. The roughness of the grain surface is taken into account. An intermediate charging regime involving ion–atom collisions and electron ionization in the perturbed plasma region is analyzed using the moment equations and Poisson’s equation. A calculation method is proposed that allows one to take into account the influence of all the above effects and determine the radius of the plasma region perturbed by the dust grain.

Supply chain coordination with green technology under cap-and-trade regulation

Cap-and-trade regulation is generally accepted as one of the most effective market-based mechanisms to curb carbon emissions. In this paper, we study the production and emission abatement decisions of a Make-To-Order supply chain consisting of a manufacturer and a retailer under cap-and trade regulation. Specifically, the manufacturer can reduce unit product carbon emission by using green technology, with the cooperation of a retailer by certain contracts, who sell the products to environment-concerned consumers. Wholesale price and cost sharing contracts are considered in the supply chain. We list some main conclusions here. First, as carbon trading price increases, the optimal production quantities (the optimal abatement levels) firstly decrease (increase) and then remain constant. Second, both wholesale price and cost sharing contracts can coordinate the supply chain. Last, combining the optimal operational decisions under the two contracts with two-part tariff agreement, we design a contract in which the retailer pays a lump fee to the manufacturer, and find that there is an interval of the lump fee to achieve Pareto improvement for the two firms.

Particle-in-cell simulation of multipactor discharge on a dielectric in a parallel-plate waveguide

An original 2D3V (two-dimensional in coordinate space and three-dimensional in velocity space) particle-in-cell code has been developed for simulation of multipactor discharge on a dielectric in a parallelplate metal waveguide with allowance for secondary electron emission (SEE) from the dielectric surface and waveguide walls, finite temperature of secondary electrons, electron space charge, and elastic and inelastic scattering of electrons from the dielectric and metal surfaces. The code allows one to simulate all stages of the multipactor discharge, from the onset of the electron avalanche to saturation. It is shown that the threshold for the excitation of a single-surface multipactor on a dielectric placed in a low-profile waveguide with absorbing walls increases as compared to that in the case of an unbounded dielectric surface due to escape of electrons onto the waveguide walls. It is found that, depending on the microwave field amplitude and the SEE characteristics of the waveguide walls, the multipactor may operate in two modes. In the first mode, which takes place at relatively low microwave amplitudes, a single-surface multipactor develops only on the dielectric, the surface of which acquires a positively potential with respect to the waveguide walls. In the second mode, which occurs at sufficiently high microwave intensities, a single-surface multipactor on the dielectric and a two-surface multipactor between the waveguide walls operate simultaneously. In this case, both the dielectric surface and the interwall space acquire a negative potential. It is shown that electron scattering from the dielectric surface and waveguide walls results in the appearance of high-energy tails in the electron distribution function.

Air quality co-benefits of subnational carbon policies

ABSTRACTTo mitigate climate change, governments ranging from city to multi-national have adopted greenhouse gas (GHG) emissions reduction targets. While the location of GHG reductions does not affect their climate benefits, it can impact human health benefits associated with co-emitted pollutants. Here, an advanced modeling framework is used to explore how subnational level GHG targets influence air pollutant co-benefits from ground level ozone and fine particulate matter. Two carbon policy scenarios are analyzed, each reducing the same total amount of GHG emissions in the Northeast US: an economy-wide Cap and Trade (CAT) program reducing emissions from all sectors of the economy, and a Clean Energy Standard (CES) reducing emissions from the electricity sector only. Results suggest that a regional CES policy will cost about 10 times more than a CAT policy. Despite having the same regional targets in the Northeast, carbon leakage to non-capped regions varies between policies. Consequently, a regional CAT policy will result in national carbon reductions that are over six times greater than the carbon reduced by the CES in 2030. Monetized regional human health benefits of the CAT and CES policies are 844% and 185% of the costs of each policy, respectively. Benefits for both policies are thus estimated to exceed their costs in the Northeast US. The estimated value of human health co-benefits associated with air pollution reductions for the CES scenario is two times that of the CAT scenario.Implications: In this research, an advanced modeling framework is used to determine the potential impacts of regional carbon policies on air pollution co-benefits associated with ground level ozone and fine particulate matter. Study results show that spatially heterogeneous GHG policies have the potential to create areas of air pollution dis-benefit. It is also shown that monetized human health benefits within the area covered by policy may be larger than the model estimated cost of the policy. These findings are of particular interest both as U.S. states work to develop plans to meet state-level carbon emissions reduction targets set by the EPA through the Clean Power Plan, and in the absence of comprehensive national carbon policy.

Penn Central Take Two

Penn Central v. New York is the most important regulatory takings case of all time. There, the Supreme Court upheld the historic preservation of Grand Central Terminal in part because the City offset the burden of the landmarking with a valuable new property interest — a transferable development right (TDR) — that could be sold to neighboring property. Extraordinarily, 1.2 million square feet of those very same TDRs, still unused for over 40 years, are the subject of new takings litigation. According to a newly filed complaint, the TDRs that saved Grand Central have themselves been taken by the government, which allegedly wiped out their value by permissively upzoning the neighboring property. The litigation is not only a captivating postscript to Penn Central, but also a compelling context for examining the category of regulatory property more generally. Regulatory property — like TDRs and pollution credits, for example — is increasingly important and valuable, but raises complicated trade-offs between the need for stability in property-based entitlements and policy flexibility in governance. This Essay ultimately argues that the creation of regulatory property should not prevent policy changes far into the future.

Interactive life cycle assessment framework to evaluate agricultural impacts and benchmark emission reduction credits from organic management

Growers who manage farming systems organically strive to maintain balanced ecosystems for sustainable food production. We examined a life cycle assessment framework to support an interactive evaluation and benchmarking of emission reduction credits (ERC) from organically managed crop production. Open source Life Cycle Analysis (LCA) software was used to streamline inventories for organic farming. The inventories were built on hierarchical levels of inputs, land operations, crops and crop rotation. The methodology was demonstrated by comparing: (1) only carbon footprints of the baseline inventories and land operations, then (2) all environmental impacts of organic potato production versus US conventional potato production and other inventoried international potato production systems to highlight effects of management differences. The footprints of inventoried land operations showed trade-off effects between the size of equipment and the degree of plant residue incorporation into soil, e.g. by shredding. Total impact and ecotoxicity impacts per kg potato production were reduced approximately three orders of magnitude on the US organic case study farm as compared to the inventoried US average conventional production. The examined LCA supports the benchmarking of ERC from organic management. It is, therefore, recommended to use the framework in future case studies of organic farms and comparative LCA's.

Integrating clean development mechanism into the development approval process of buildings: A case of urban housing in Uganda

Since climate change is no respecter of geographical boundaries, concerted mitigating actions such as clean development mechanism (CDM), are desirable. In CDM, developed countries can earn certified emission reduction credits from emission reduction projects undertaken in developing countries. Recent research suggests that, theoretically, CDM can be extended to the building sector. However, there is limited research on how CDM can be integrated in the development approval process (DAP) of buildings. This paper presents an investigation on how CDM could be integrated into the DAP of buildings in urban Uganda. A method of process modelling was used to describe the existing DAP, and also to design a new DAP. To demonstrate how CDM could be integrated into the new DAP, a typical dwelling unit was used. Two options for the dwelling were considered: a baseline (i.e. constructed using typical materials, plant, and workforce) and alternative (i.e. constructed using provisions to reduce carbon emissions). The difference in emissions in the two options constituted the basis for a CDM. Results suggested that the existing DAP does not consider carbon accounting and thus was not congruent with CDM modalities. A new DAP which is compatible with CDM was proposed. When the CDM concept was integrated into the new DAP, a bottom-up projection regarding construction of 28,000 houses annually within the capital city showed that reductions of over 200 ktCO2 could be achieved in a period of 10 years. These figures were comparable with prevailing CDM initiatives. The structure of a CDM programme aided by the new DAP was presented and discussed. This study shows that integrating CDM into the DAP of buildings in Uganda is possible if assessment of carbon emissions is incorporated in the existing DAP. The overall findings suggest that CDM could promote market-based mechanisms of enhancing sustainable construction in developing countries.

Experience with linking greenhouse gas emissions trading systems

Two emissions trading systems (ETS) are linked if a participant in one system can use an allowance or a credit issued by either system for compliance. Linking ETS offers a number of potential benefits including, lower overall compliance cost, price protection, greater liquidity in the allowance market, and reduced emissions leakage. It is useful to distinguish: (a) A unilateral link—one ETS accepts the allowances of another ETS for compliance purposes, but not vice versa. Any link to an offset system, such as the Clean Development Mechanism (CDM), is a unilateral link for the ETS that accepts those credits. (b) A bilateral link—each ETS accepts the allowances of the other ETS for compliance purposes. Another way to implement a bilateral link is to adopt a common compliance instrument. The European Union ETS (EU ETS) has a single compliance instrument—the EU allowance—that is used in all 31 participating countries. Several national and subnational jurisdictions have established an ETS for one or more greenhouse gases (GHGs). Some of these ETS also issue offset credits for GHG emission reductions achieved by specified sources. In addition, the international CDM and Joint Implementation (JI) mechanisms issue offset credits for GHG emission reductions. Most ETS have established unilateral links, mainly to the CDM and JI, but also to other ETS. Apart from the systems that are part of the EU ETS and Regional Greenhouse Gas Initiative (RGGI) only one bilateral link, between the California and Quebec ETS, has been established. This study summarizes the experience with linking GHG ETS. WIREs Energy Environ 2016, 5:246–260. doi: 10.1002/wene.191This article is categorized under: Energy and Climate > Economics and Policy Energy and Climate > Systems and Infrastructure Energy Policy and Planning > Climate and Environment

“Monetary” rules for a linked system of offset credits

Three dominant issues have historically plagued climate negotiations: How to bypass issues of sovereignty, generate sufficient climate finance, and establish an agreement that is inclusive of the current major polluters. These issues are prevalent within the Clean Development Mechanism (CDM) under the Kyoto Protocol, and the CDM has provided policy makers with a useful starting point to understanding how offset credits can be utilised within a post-Kyoto framework. The primary aim of this research is to investigate how project-based offset credits generated by states would interact within a linked framework using monetary rules and exchange rates. The examination of a linked system, specifically, was owing to the structure of the proposed agreement to be finalised in Paris at COP 21 where nationally determined contributions would be submitted by each state, allowing for the possibility of linked domestic carbon market mechanisms. The certified emission reduction credits of the CDM were used as a model to investigate the trade of offset credits within a linked system which act as a unique climate currency of each domestic offset credit mechanism. These offset credits could be earned through the implementation of domestic projects or projects hosted in other states. From this research, we conclude that fixed exchange rates are more stable than flexible exchange rates in a climate currency framework. Fixed exchange rates reduce losses of capital (owing to uncertainty in the markets) and the prominence of asymmetric spatial price transmission associated with fiat offset credit prices. To encourage co-operation between developing and developed countries, it is recommended that a combination of currency area theory and trade blocs be implemented as opposed to a currency union. Currency areas are the most viable option as they maintain that the domestic offset credit mechanism is under the control of the state and retains a level of stability as individual state offset credit prices are fixed to the same price. Even though this research forms the basis for a new climate policy architecture, the overall effectiveness of the policy will be determined by the selection of appropriate discount schemes, increased participation and agreement by states, and most significantly, political will.

Time effects of climate change mitigation strategies for second generation biofuels and co-products with temporary carbon storage

Second generation biofuels offer a means of reducing greenhouse gas emissions and storing or delaying soil carbon emissions relative to petroleum-based fuels depending upon the strategy used to synthesize the biofuel and co-products. Unless mitigated, the soil organic carbon and nitrogen loss resulting from removing agricultural residues for biofuel production may cause life cycle greenhouse gas emissions to surpass national policy thresholds, and thus risk non-compliance with renewable fuel policy. Strategies to mitigate soil organic carbon loss such as using nutrient and carbon-rich, and stable land amendments will lead to time-variable greenhouse gas credits. Recent studies have argued for using time-dependent rather than time-averaged radiative forcing methods for biofuel greenhouse gas accounting but few life cycle assessment studies have examined the impact of time-varying emissions of soil organic carbon using the Intergovernmental Panel on Climate Change tier 3 models. This study applies a time-dependent radiative forcing approach to a 100-year time-series data set of life cycle greenhouse gas emissions for lignocellulosic ethanol that includes temporally variable soil greenhouse gas emissions. This study demonstrates that averaging soil emissions and neglecting the time when the sequestration or release occurs within a selected time horizon can lead to a 9% to over 80% overestimation of the magnitude of the effect of the mitigation strategy. This affirms that employing strategies to maintain soil organic carbon stock early within a biofuel program supports climate change mitigation. Such strategies would guide farmers to best manage soil carbon within the biofuel production life cycle. Time-dependent approaches underscore the need for early measures of greenhouse gas curtailment to support sustainable renewable biofuel and agricultural policy.

Innovative allocation mechanism design of carbon emission permits in China under the background of a low-carbon economy

The total quantity control and trading of carbon emission permits (CEPs) are important means to promote the development of a low-carbon economy, and the key is the initial allocation of the CEPs. For the initial allocation problem of CEPs in China, we analyze the disadvantages of the existing free allocation method, namely, that it cannot stimulate the polluters to declare their real marginal-cost information and so it is difficult to achieve effectiveness in resource allocation. Considering these disadvantages, we design an incentive auction mechanism for allocating CEPs based on the theory and methods of a divisible-good auction, to achieve the optimal supply strategy of the government and the equilibrium bidding strategies of polluters. The theoretical proof shows that this auction mechanism has properties such as stimulation of information and validity of allocation.The auction mechanism is applied to the problem of CEP allocation in fourteen cities in the Hanjiang River Basin in China. From the allocation results of this application example, we make some suggestions for improving the implementation of the CEP trading system and the design of future environmental policy in a low-carbon economy.

The economic feasibility of light-emitting diode (LED) lights for the Korean offshore squid-jigging fishery

Squid-jigging has one of the highest levels of fuel consumption and greenhouse gas emission per kg of fish production of any of Korea's fisheries. The lights on squid-jigging vessels are the primary reason for their high fuel use and account for about 65% of total fuel costs for these vessels. This suggests that a high-efficiency lighting system would improve fisher's profits and reduce environmental impact. This study analyzed the economic feasibility of changing the fishing lights on squid-jigging vessels from metal halide (MH) lights to light-emitting diodes (LED) lights in terms of managing fuel costs and decreasing greenhouse gas emissions. Net present value (NPV) and benefit-cost ratio (BCR) approaches were used including with a sensitivity analysis of a governmental subsidy of the fishery for the use of LED lights. Fuel use would be reduced by 65,163 kL (USD 54,999,302) and GHG emissions would be reduced by 172,486 tCO2e annually if all offshore squid-jigging vessels changed to LED lights. The annual economic benefits ranged from KRW 1034.9 million (USD 932,351) to KRW 1724.9 million (USD 1,553,919) when the minimum and maximum values for Korean carbon trading prices were applied, respectively. Furthermore, the NPV and BCR results showed that it would be economically feasible to use LED lights if a vessel operated for 10 years after changing its system. The NPV that included benefits of fuel reduction and greenhouse gas emission reduction credits was 89% (USD 22,786) higher than when considering fuel reduction alone. The benefit of Government subsidies for installing LED lights was sensitive to catch rate and was only necessary if catches fell below 78.9% of that achieved with MH lights. The subsidy rate with the NPV set to zero increased about 9.3% when the catch production ratio of squid decreased by 1%. This analysis shows there is substantial opportunity for reducing emissions in fisheries by adopting lower emission technology. Adoption can require Government intervention, such as with subsidy in this case despite long run benefits of reduced fuel use and thus cost through the adoption of LED lights.