A general model for CO2 regulation:: The case of Denmark

For both economic, political and administrative reasons, a mixed design of permit market, bubble and tax may be preferable for CO2 regulation, In the case of Denmark, a CO2 market should be introduced for the private manufacturing sector and an administratively set CO2 bubble should be introduced for the public electricity sector, Permits should then be devaluated in year 2005 by 20%, A CO2 tax should be correctly set at a level of $50 in year 2005 for households, the transportation sector and private firms not participating in the CO2 market, This model may guide future energy policies in other countries as well, (C) 1997 Elsevier Science Ltd. All rights reserved.