Interacting policies in power systems: Renewable subsidies and a carbon tax

Citation data:

The Electricity Journal, ISSN: 1040-6190, Vol: 30, Issue: 6, Page: 80-84

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Vivek Bhandari; Anthony M. Giacomoni; Bruce F. Wollenberg; Elizabeth J. Wilson
Elsevier BV
Business, Management and Accounting; Energy; Social Sciences
article description
Without careful planning and design, energy policies like carbon taxes and renewable subsidies like production tax credits undercut one another in unanticipated ways. We examine how a carbon tax interacts with PTCs by simulating an electricity market using the IEEE RTS model with a carbon tax of $38/tonCO2e and a PTC of $23/MWh. The results show that PTCs work against the carbon tax by both lowering average energy prices and altering the generator dispatch.