Aarhus University Seal / Aarhus Universitets segl

The US Acid Rain Program: design, performance, and assessment

Research output: Contribution to journal/Conference contribution in journal/Contribution to newspaperJournal articleResearchpeer-review

  • Department of Economics
The US Acid Rain Program (ARP) from 1990 allows 1,000 major electric utilities all over the US to trade SO2 permits. Historical emission rights have been grandfathered and the target level is 50% SO2 reduction. Market performance has been successfull with much trade activity and unexpectedly low permit prices. Property rights to permits have been well-defined, strictly enforced, and sources have been allowed to trade freely without administrative approval of each trade. Ignoring source location in this way has kept transaction costs at a minimum. In conclusion, the policy design of the ARP is recommendable for future environmental regulation where source location may be ignored, e.g., for creating CO2 markets in the US and the EU.
Udgivelsesdato: DEC
Original languageEnglish
JournalEnvironment and Planning C: Government & Policy
Pages (from-to)723-34
Number of pages688
Publication statusPublished - 1998

    Research areas

  • United states, Acid Rain Program, SO2, Electric utilities, Tradable permit systems, Grandfathering, Market performance, Property rights, Source location, Transaction costs

See relations at Aarhus University Citationformats

ID: 32314062