Using Emission Taxes as Policy Instruments for Clean Coal Technologies in Indian Coal-fired Power Plants

Abstract

Abstract
Rising electrification needs have led to increased coal combustion, which in turn has made India, the second highest sulphur dioxide and third highest carbon dioxide emitter. The twin task of providing electricity to 300 million citizens while meeting stringent climate change mitigation needs is a major challenge to India. Thus, a strategy for joint energy-economy growth has to be worked out. Coal-fired power plants account for around half of the CO2 emissions from the organized sector in India, and 60 per cent of the total installed power capacity. With a coal cess of Rs.400 per tonne combined with the auction scheme as per the order of the Hon’ble Supreme Court, a tax on carbon and sulphur emissions has been projected by several modelling exercises including the Report of the High-Level Commission on Carbon Prices. This paper begins with an understanding of the various emission trading and taxation mechanisms studied and implemented globally. Perspectives will be given about design of carbon and sulphur taxes, with an extensive discussion on recent literature. The analysis will be carried out with the aid of the Integrated Environmental Control Model (IECM-cs), developed by the Carnegie Mellon University. In the process, it will also assess the cost feasibility and ramifications of such taxes in the Indian energy and developmental scenario. The technologies analysed in this study will focus mostly on CCS and flue gas desulfurization (FGD) for CO2 and SO2 control. In the latter part, the paper discusses recommendations as to the policy making process and the various parameters involved with reference to such schemes implemented globally. The analysis and assessment presented in this paper will give insights to the policy-makers on the utility of emission taxes to implement clean coal technologies in electrical utilities.

Keywords: Carbon, emission, incentives, sustainable, technology, power

Cite this Article
Himanshi Thakur Using Emission Taxes as Policy Instruments for Clean Coal Technologies in Indian Coal Fired Power Plants . Journal of Energy, Environment & Carbon Credits . 2020 ; 10 1 8 14 p.