Linking Carbon Markets Could Unlock Massive Emissions Cuts and Cost Savings
This study looks at how different systems tackling carbon emissions can link up to reduce overall costs effectively. They focused on California and the Regional Greenhouse Gas Initiative's systems that are almost ready to connect despite some initial differences. Using a simulation model of electricity markets, they tested how these combined systems could work. By considering factors like different program strengths and trading rules, they found that when the systems are linked, emissions and market efficiency change in expected ways. However, the benefits of efficiency might not be distributed in straightforward ways, showing that the interactions between different factors in the systems can be complex.