Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/173400
Authors: 
Richstein, Jörn C.
Year of Publication: 
2017
Series/Report no.: 
DIW Discussion Papers 1714
Abstract: 
Low and uncertain carbon prices are often stated as a major obstacle for industrial sector investments in technologies to deliver deep emissions reductions. Project-based carbon contracts underwritten by national governments could addressregulatory risk, lower financing costs and strengthen incentives for emission reductions at investment and operation stage. In this paper design options for project-based carbon contracts are assessed using an analytical model capturing risk aversion of investors with a meanvariance utility function. The model is also used to assess how a combination with grant support for innovative projects can minimize overall costs of innovation policy. Savings in financing costs are quantified using a stylized project finance cash flow analysis.
Subjects: 
emission trading systems
carbon contract
innovation support
JEL: 
D81
Q48
Q54
Q55
Q58
O38
Document Type: 
Working Paper

Files in This Item:
File
Size
489.82 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.