China and the United States respectively adopted desulfurization electricity price and emission trading to achieved the effective sulfur dioxide emissions reduction in thermal power industry. By the methodology of cost-benefit analysis and comparative analysis with the United States, this paper analyzed the coal-fired power plants’ desulfurization cost, benefit, and social emission reduction cost of China’s desulfurization electricity price policy. The main findings are, the results of cost-benefit analysis show that China’s policy against the polluter pays principle, polluters can get benefit from this policy. Second, in terms of the cost of emission reduction, China’s cost is very high with 5.52 billion U.S. dollars in 2000 while the USA only cost 0.5-2.0 billion US dollars. Also, compared with the decreasing social cost of the United States, the China desulfurization electricity price policy leads the social SO2 reduction cost expanded and economic inefficiencies. The conclusion is, as the policy’s objective has been achieved, the desulfurization electricity price policy in China should be cancelled. The way of reducing pollutants emission in the form of price subsidies cannot be extended to other pollutants or other industries emission control.
Read full abstract