Co-benefits And Cost Analysis Of Carbon Abatement Of CDM In China

The Clean Development Mechanism(CDM)is one of the flexible compliance mechanisms introduced by the Kyoto Protocol to reduce emissions.It not only helps reduce greenhouse gas emissions,but also avoids air pollution by generating clean electricity and then result in co-benefits.This paper takes CDM projects in China from January 2005 to May 2017 as the research object,and divides them into eight types and six regions.Firstly,we calculate the monetized co-benefits of SO2,NOX and PM2.5 emission reduction which is based on existing literature research.Secondly,based on the traditional carbon abatement cost model,we construct a revised carbon abatement cost model that takes the co-benefits into account,and then get the revised marginal abatement cost curve(MAC).Lastly,we use this revised MAC as an analytical tool to analyze the co-benefit and the actual marginal abatement cost for CDM projects of different types and regions.This study finds that(1)after considering the co-benefits,the marginal abatement costs of all types of CDM projects have decreased to varying degrees.Among them,the energy saving and energy efficiency projects and the wind power projects in North China,and the hydropower projects in East China are the most obvious.The marginal abatement cost of those projects under average emission reductions drops more than 10% which reflect that the co-benefit of those CDM projects is more evident.(2)The MAC curves of most types of CDM projects are mostly inverted "U" type which means that marginal abatement cost firstly increases and then decreases with the increase of the scale of emission reduction.(3)At the same time,various types of CDM projects in different regions have different marginal abatement costs at different emission reduction stages.(4)The paper also finds that,after considering the co-benefits,the inflection point of marginal abatement cost for most of the projects comes earlier.Given that China is actively considering integrating CCERs into the carbon trading market,identifying con-benefits and actual marginal abatement costs in different regions and different types of carbon abatement projects is of great importance to the flow of capital to reduce emissions,as well as promote synergetic control of greenhouse gases and air pollutants.