Stimulating diffusion of low-carbon technology : evidence from a voluntary program

Lange, Ian and Ferrara, Andreas (2011) Stimulating diffusion of low-carbon technology : evidence from a voluntary program. Fraser of Allander Economic Commentary, Special E (1). pp. 35-36. ISSN 2046-5378

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    Voluntary programs are an increasing part of the environmental policy portfolio. These voluntary programs attempt to reduce environmental impacts through emission reduction pledges, improve the environmental awareness of firms or provide information to the public. A more novel use of voluntary programs has involved the acceleration of technology diffusion of environmentally beneficial technologies to overcome typical problems like lack of technical information, principal-agent problems or to lower the threshold of network externalities. However, this type of voluntary program is what will be needed for firms and councils to comply with the UK Climate Change Act of 2008 and/or the Climate Change (Scotland) Act of 2009. These Acts require medium and large public and private sector institutions to meet an emissions cap that is more stringent than the EU Emissions Trading Scheme. One technology with a high potential for carbon emission reductions is combined-heat-and-power (CHP), also known as cogeneration.