Working Paper: NBER ID: w18462
Authors: Joshua S. Graff Zivin; Matthew Kotchen; Erin T. Mansur
Abstract: In this paper, we develop a methodology for estimating marginal emissions of electricity demand that vary by location and time of day across the United States. The approach takes account of the generation mix within interconnected electricity markets and shifting load profiles throughout the day. Using data available for 2007 through 2009, with a focus on carbon dioxide (CO2), we find substantial variation among locations and times of day. Marginal emission rates are more than three times as large in the upper Midwest compared to the western United States, and within regions, rates for some hours of the day are more than twice those for others. We apply our results to an evaluation of plug-in electric vehicles (PEVs). The CO2 emissions per mile from driving PEVs are less than those from driving a hybrid car in the western United States and Texas. In the upper Midwest, however, charging during the recommended hours at night implies that PEVs generate more emissions per mile than the average car currently on the road. Underlying many of our results is a fundamental tension between electricity load management and environmental goals: the hours when electricity is the least expensive to produce tend to be the hours with the greatest emissions. In addition to PEVs, we show how our estimates are useful for evaluating the heterogeneous effects of other policies and initiatives, such as distributed solar and real-time pricing.
Keywords: electric cars; marginal emissions; electricity-shifting policies; CO2 emissions; environmental policy
JEL Codes: H23; L94; Q5
Edges that are evidenced by causal inference methods are in orange, and the rest are in light blue.
| Cause | Effect |
|---|---|
| Electricity demand (L97) | Marginal emissions (Q52) |
| Charging PEVs at night in the upper Midwest (L97) | Higher emissions per mile than gasoline-powered vehicle (L94) |
| Electricity load management (L97) | Environmental goals (Q56) |
| Electricity consumption (L94) | CO2 emissions per kilowatt-hour consumed (L94) |
| Location and time of day (J29) | Marginal emissions of electricity demand (L94) |