My Presentation, An Analysis of Whether the Kyoto Protocol is Reducing the Cost Advantage of EU Fossil Electricity Over EU Wind Electricity, was given at the 2008 European Wind Energy Conference. 31 March- 03 April 2008, Brussels, Belgium. 

I was in the Wind Energy and the Future of the Carbon Market (Session Code CW1) Workshop on Wednesday, 2 April 2008. 9:00-10:30am. My presentation is # CW1.1. 

To view the EWEC 2008 Program go to http://www.ewec2008.org/index.php?id=950

Abstract

Carbon emissions are causing global warming. The Kyoto Protocol has been set up to reduce carbon emissions. This paper covers the EU electric power industry. Burning fossil fuel to generate electricity creates carbon emissions. Wind generated electricity has no carbon emissions.  Wind energy is, however, more expensive than fossil electricity. The Protocol has set a time period by which the EU Annex I nations, organized under the common ETS emissions bubble, must reduce the maximum amount (cap) of carbon emissions that they can emit. The Protocol adds the cost of carbon emission reductions to the cost of generating fossil fuel electricity. The Protocol is, therefore, a great benefit to EU wind plants because it will reduce the relative cost advantage of EU fossil electricity. This paper examines the Protocol’s prototype carbon emission reduction architectures (cap and control, cap and trade, carbon tax) to determine which architecture most efficiently reduces the EU power industry carbon emissions to their assigned amount (AAU). The paper then discusses which architecture causes the greatest reduction in the relative cost advantage of EU fossil electricity. The paper examines each architecture’s significant structural components (“the details”). Each architecture must have clearly defined penalties for non-attainment. This means that cap and command is the foundation on which the other architectures are constructed. For cap and command, the details are the setting up of a well organized efficient administrative structure. The cap and trade architecture is used by the EU in its ETS.  The ETS details are auctioning verse assignment of carbon emission units (under the bubble the AAU are referred to as European Amounts [EUA]), allowing ETS offsets (JI- ERU, CDM- CER, CDM additionality), banking, unit price limits and the setting up of a well organized and efficient commodity market to clear all EUA, ERU and CER trades. For the carbon tax, the details are the definition of the tax base (t_m-CO₂/t_m-fossil fuel vs. t_m-CO₂/MWh), the tax rate (€/t_m-CO₂) and the setting up of a well organized and efficient taxing authority. The result is a detailed comparison of the three architectures for use in the EU and a determination of which architecture gives the greatest reduction in EU fossil electricity’s cost advantage. The paper also examines the positive (Protocol is an EU treaty) and negative (politics may not lead to a carbon minimizing architecture) consequences of the Protocol architecture having been chosen in the EU Annex I national capitals and in Brussels.

Sorry, my paper was to have been included in the 2008 EWEC proceedings, but I had to complete some other work so I did not complete my paper by the deadline.  It will soon be done.

Attendees who would like a copy of my PowerPoint presentation can email me their request.  I have a list of the attendees.

Non-attendees can set up an appointment.

MY GHG Emissions Papers Will Help You Understand Global Warming.

To download the abstracts for these papers go to MY GHG Emissions Papers Will Help You Understand Global Warming

 European Wind Energy Association