Environmental taxes affect economies differently based on market structure. In industries with imperfect competition and free entry, these taxes can change the number and size of firms, impacting economies of scale. The price elasticity of demand plays a crucial role, with export demand being more sensitive to price changes. A study on Germany shows that a carbon tax leads to structural changes favoring less energy-intensive industries under imperfect competition. The total costs of environmental regulation can vary under imperfect competition, depending on whether aggregate gains or losses in economies of scale prevail.