CO2-skatter, dobbelt-dividende og konkurrence i energisektoren: Anvendelser af den danske AGL-model ECOSMEC

Abstract:

In this paper we develop a new CGE model of the Danish economy with the acronym ECOSMEC (Economic COuncil Simulation Model with Energy markets and Carbon taxation). The model is a hybrid of two existing static models developed by respectively the Secretariat of the Danish Economic Council and by the MobiDK model project in the Ministry of Business and Industry. Distinct features of the ECOSMEC model are a rather disaggregated modelling of energy demand and supply, introduction of various market structures in the energy sector, and a consistent specification of different household types.

The simulations presented in the paper have the following implications: Firstly, a uniform CO2 tax of approximately 300 DKK per ton could reduce emissions by 20 per cent in a scenario with perfect competiton in the energy sector. Secondly, a double dividend (reduced emissions and increased welfare) could be gained by using the CO2 tax revenue for reducing distorting income taxes. However, the double dividend result depends decisively on the applied elasticity of substitution between consumption and leisure. Thirdly, assuming different market structures in the energy sector influences the uniform CO2 tax needed to reach a given emission target. Fourthly, the empirical arguments for differentiated CO2 taxes motivated by imperfect energy markets are weak. Fifthly, the Danish economy could benefit from a deregulation of the electricity and district heating sector with respect to welfare and economic activity. This result holds also if CO² emissions are kept constant.