Narrow Results

This study incorporates consumer’s low carbon awareness (CLA) and demand forecasting into supply chains that adopt the cap-and-trade system. Three demand forecasting scenarios are discussed, namely, information sharing, full information sharing, and retailer-only forecasting. Strategies for pricing and reduction of equilibrium of carbon emission are derived. We also compare the decisions and profits in the three cases and present numerical analysis.

Among the carbon regulation policy schemes, the cap-and-trade has received more attention because of its efficiency and flexibility. Two primary challenges with the cap-and-trade scheme are determining the correct cap and carbon trading price in the carbon market. This paper presents a bi-level model to investigate these two challenges in the cap-and-trade scheme formed between multiple supply chains and the government. At the first level, the government minimizes the cap in such a way that the costs of the supply chains do not rise too much. At the second level, the supply chains minimize their costs according to their cap and trade the dedicated allowances. An exact and a heuristic method are developed to solve the bi-level model. The computational results on a set of randomly generated instances show the effectiveness of the presented heuristic. Sensitivity analysis demonstrates that the government should choose proper amounts of caps to balance costs and environmental benefits.

This paper focuses on the impact of ‘cap-and-trade’ mechanism and customer’s environmental awareness on emission-dependent manufacturer. Carbon emission cap from the perspective of government will be confirmed. In the ‘cap-and-trade’ system, emission permit becomes one of the key factors of production for emission-dependent firms. If the cap is insufficient to satisfy the target production, extra permit should be purchased via trading, otherwise, the remaining permit will be sold to other firms. Since the product demand has been influenced due to the consideration of customer environmental awareness, the production will be decided by analyzing the produced decision-making process of the emission-dependent firm in this case. Base on the consideration of improving environment benefits, carbon emission cap of this kind of manufacturer will be determined. Additionally, numerical analysis is considered. We found that it is profitable for the manufacturer investing; meanwhile, the emission intensity of this manufacturer is ameliorative. And emission reduction investment should be encouraged by the environmental administration in some way of preferential policy.

The People's Republic of China (PRC) launched seven emissions trading scheme (ETS) pilot projects in 2013–2014 to explore a cost-effective approach for low-carbon development. The central government subsequently announced its plans for the full-fledged implementation of ETS in the entire PRC in late 2017. To ensure the success of ETS in the PRC, it is necessary to gain a better understanding of the experiences and lessons learned in the pilot projects. In this paper, we provide a policy overview of the seven pilot projects, including policy design, legislative basis, and market performance. We use the synthetic control method to evaluate the carbon mitigation effect of each of the seven ETS pilots. Our findings are that success has been limited and uneven across the pilot projects, which warrants deeper evaluation of the differences between them and caution in scheme expansion. Results from the analysis also shed light on policy improvements that can benefit the nationwide development of ETS.