Japan’s Power Industry Division’s Behavior Selection Under The Regulation Of Carbon Emissions And The Impact On Social Welfare

Many countries have begun to commit themselves to retarding the emission ofgreenhouse gases, such as CO2after global warming have become a worldwide focus whichcombines environmental protection and economic development. The signing of “UnitedNations Framework Convention on Climate Change—Kyoto Protocol” remarks the adventof Low-carbon era. As the promoter and signer, to reduce the prescribed emission amountare both Japan’s obligation and responsibility. In order to make the transformation to lowcarbon pattern possible, Japan sets the construction of “low carbon society” as the futuregoal through mixing various official policies into the details of economic development.According to the real situation: the power supply of our country mainly relys onthermal power. The primal fuel of thermal power discharge the most amount of charcoal.Directed plans of energy-saving and emission-reduction must be established so as to controland lower the emission amount. We need to learn from those that made progress in carbontax and emission allowance polices since ours are not implemented or carried outimmaturely. There are similarities between Japan’s electricity market and the electricitymarket in China, construction and analysis of the model in this thesis is applicable to ourcountry to a certain extent.The production of CO2stems mostly from the burning of fossil fuels, which is also theblood of economy’s normally functioning.The regulation of CO2will more or less makesimpact on development of economy and the social subjects. Therefore, these impacts shouldbe taken into consideration when the government developping regulatory measures.Targeted at the power plants of the Japan energy transfer division and setting social welfareas the standard, the thesis aims to make optimal choice of governmental regulations underthe principle of welfare maximization, considering the effects of social welfate. Through thehypothesis and derivation of the model, we can hold that, cumulative control and emissiontaxation on the same level of qualitative. Goverment should consider the feedback of powercompany, and taking it into the regulation.