2010 Volume 40 Issue 3 Pages 721-733
In this study, we examined how to smoothly process and implement the initial emission permit allocation when an emission trading system is introduced into China. The optimal allocation for emission trading was investigated based on the social background of water pollution, social demand and complicated trans-regional problems.
According to the principles for initial emission permit allocation (fairness doctrine and efficiency doctrine), we selected 31 provinces in China as the targets and assumed a constraint as total quantity of COD in China to carry out the simulation. First, the Gini coefficient method was adopted and the indexes of population, GDP, water resources, usage of water resources, area of land, employed population and tax were selected as the evaluation system to assess the fairness doctrine allocation. Second, the environmental simulation analysis method was adopted to evaluate the efficiency doctrine allocation. The simulation model consisted of one objective function to minimize the reduction costs of COD water pollutants and restriction functions to achieve optimal emission allocation for different regions in China.
The following conclusions can be made based on the analysis of initial water pollution permit allocation with the introduction of a emission trading system. First, the indexes of population, GDP, usage of water resources and employed population should be selected to allocate initial water pollution permits and satisfy the requirements of the fairness doctrine. Furthermore, when the allocation of emission permit satisfies the requirements of the fairness and efficiency doctrines, water pollutant reduction can be achieved with constraints on the minimum reduction in cost.
