BusinessEnvironmentCapping Energy Costs Will Damage Climate Change Progress in...

Capping Energy Costs Will Damage Climate Change Progress in Developing Countries

-

- Advertisment -sslate

Developing and emerging countries will fail to make any significant contribution to global sustainability efforts, unless governments stop capping electricity prices, according to new research from Durham University Business School.

The study, undertaken by Professor Laura Marsiliani alongside Professor Thomas Renstrom and colleagues from North South University in Bangladesh and Copenhagen Business School and, sought to find better ways to support developing nations to reduce their fossil fuel use.

Whilst global initiatives such as the COP and the UNFCCC conferences have been effective in pushing climate change action to the top of the political and economic agenda, and in encouraging countries to pledge their support to decarbonisation efforts, the researchers say that developing nations will struggle to meet the targets they’ve agreed to.

salt

The biggest challenge to overcome is continued reliance on fossil fuels. The researchers say little has been done in terms of reforming the energy markets in developing nations.

Professor Marsiliani says,

“In developing and emerging economies, energy policies primarily focus on the issue of providing energy security and accessibility for all, often at the expense of economic efficiency and environmental sustainability. Whilst everyone agrees that energy policies and practices should indeed promote sustainable development, often these objectives work in contrast to each other, leading to dire consequences and limited chance of making any real progress.”

These consequences include distorting the market by, for example, controlling the price of electricity to ensure affordability for all households, and subsidising fuel costs to support energy production.

Such measures have a long-lasting negative impact on the planet – triggering higher levels of greenhouse gasses, and jeopardising any attempt at meeting sustainable development goals.

To tackle the problem, Professor Marsiliani and her colleagues’ work investigates how a variety of decarbonisation policies might be implemented, and which would deliver the greatest benefit to the planet without adversely affecting society.

The researchers focused on Bangladesh as a key example, exploring ways in which the country could achieve its pledge to reduce greenhouse gas emissions by a minimum of 5%, by the year 2030.

Professor Marsiliani says,

“Bangladesh’s electricity market currently operates under a heavy subsidisation of fossil fuels and regulated prices through capping energy prices. Such interventions, whilst well-intentioned, are highly damaging as they distort the fuel mix in electricity production and encourage the overconsumption of fossil fuels, slowing down any efforts for introducing greener fuel methods. Because of this, Bangladesh’s CO2 emissions continue to grow.”

The researchers used a Dynamic Stochastic General Equilibrium (DSGE) model to observe the potential benefits to be gained by Bangladesh if the country were to either; implement a modest carbon tax, remove fossil fuel subsidies or eliminate the price distortions put upon electricity.

mountain

Professor Marsiliani’s study reveals that not only would all measures would result in achieving a significant reduction in emissions, but could also provide a boost to the economy, in terms of a GDP increase.

For example, in just one scenario, introducing a carbon tax of just $5 was estimated to result in a reduction in electricity generation by firms using oil by as much as 4.4% and also reduced the use of gas by private firms by 4.7%, resulting in a reduction in CO2 emissions of only 0.3%The carbon tax, the researchers say, can however provide further benefit by generating a tax revenue to be passed back to households.

Remarkably, liberalising Bangladesh’s energy markets instead was estimated to reduce CO2 emissions by as much as 4.6%, providing a realistic chance for the country to reach its 5% target, well before the 2030 deadline. Therefore, eliminating energy price control is more important that introducing carbon taxes in terms of cutting CO2 emissions. What is crucial for success, the researchers say, is securing government support and commitment.

The full article “Decarbonisation Policies and Energy Price Reforms in Bangladesh” has been published in Energy Policy – an international peer-reviewed journal addressing the policy implications of energy supply and use from their economic, social, planning and environmental aspects. It is available to read and download via the journal’s website.

Sunshine Slate
Sunshine Slatehttps://www.sunshineslate.com
Sunshine Slate is your news, entertainment, music fashion website. We provide you with the latest breaking news and videos straight from the United States of America.

LEAVE A REPLY

Please enter your comment!
Please enter your name here

Latest news

Why is sociology on the chopping block in Florida?

Florida's education system is a proposal to drop sociology, the study of social life and the causes and consequences of human behavior

Marriott Homes and Villas vs. Apartments by Marriott: A Comprehensive Comparison

Marriott International, a global hospitality leader, offers two distinct vacation rental programs: Marriott Homes and Villas and Apartments by Marriott

Unlocking the Ultimate NFL Experience: Why StubHub Reigns Supreme for Season Tickets

When it comes to purchasing NFL season tickets, one platform stands out among the rest: StubHub.

Nurturing Ideas, Shaping Policy: The Vital Role of Think Tanks and Research Institutions in the USA

This article explores the crucial role that think tanks and research institutions play in the USA, delving into their functions, impact, and the challenges they face.
- Advertisement -

Best Apps and Games for your New Mobile Phone

We can install any app from the google play store very quickly. Let’s take a look at some most amazing apps for android mobile phones.

Florida Student groups defend Palestinian rights with lawsuits against state officials

The Students for Justice in Palestine chapters at the University of Florida and the University of South Florida are filing lawsuits against the deactivation orders
edealo.com
- Advertisement -sslate
transformerscon

Must read

Nurturing Ideas, Shaping Policy: The Vital Role of Think Tanks and Research Institutions in the USA

This article explores the crucial role that think tanks and research institutions play in the USA, delving into their functions, impact, and the challenges they face.

Best Apps and Games for your New Mobile Phone

We can install any app from the google play store very quickly. Let’s take a look at some most amazing apps for android mobile phones.
- Advertisement -
- Advertisement -sslate

You might also likeRELATED
Recommended to you