Understanding Marginal Abatement Cost Curve in Turkish Economy on the Way to Reduce of Greenhouse Gas Emission

Authors : Levent AYDIN

Pages : 33-46

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Publication Date : 2017-12-20

Article Type : Research Paper

Abstract :This paper examines the possibility of reducing greenhouse gas emissions in Turkey and estimates its costs in a number of sectors of the economy. The main output of this paper is introduced as a `marginal cost reduction curve` or MACC for Turkish economic sectors. A MACC is a graphical representation of the extent of emissions reductions that can be achieved through carbon pricing made in different rates across the economy, and the benefits or costs associated with reducing emissions per ton. In order to build the MACCs for Turkish economy, we use computable general equilibrium model. The scenarios of the model is to run the model under different constraints corresponding to different carbon prices, such as 1,5, 10, 25, 50, 75, and 100 dollars per ton of carbon. For each set of carbon price constraints, the corresponding regional levels of carbon abatement are generated by the model. We then determine the levels of abatement as a function of the carbon prices for economy. 
Keywords : Marginal abatement cost, Carbon tax, Greenhouse gasses, CGE model, Turkey