The Impact of Heterogeneous NOx Regulations on Distributed Electricity Generation in U.S. Manufacturing
April 2015
Working Paper Number:
CES-15-12
Abstract
The US EPA's command-and-control NOx policies of the early 1990s are associated with a 3.1 percentage point reduction in the likelihood of manufacturing plants vertically integrating the electricity generation process. During the same period California adopted a cap-and-trade program for NOx emissions that resulted in no significant impact on distributed electricity generation in manufacturing. These results suggest that traditional command-and-control approaches to air pollution may exacerbate other market failures such as the energy efficiency gap, because distributed generation is generally recognized as a more energy efficient means of producing electricity
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production,
manufacturing,
industrial,
produce,
efficiency,
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regulation,
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emission,
electricity,
pollution,
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environmental,
pollutant,
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Review of Economics and Statistics,
Energy Information Administration,
Census Bureau Longitudinal Business Database,
Longitudinal Business Database,
Department of Energy,
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Environmental Protection Agency,
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Journal of Economic Perspectives,
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