Climate Policy

Governments that impose taxes on carbon dioxide and other greenhouse gas emissions can benefit from a cleaner, more climate-friendly environment and a revenue stream that can be tapped to lower other taxes and create jobs. But environmental taxes may also exact an excessive financial burden on low-income households, which spend a much greater fraction of their budgets than richer households do on heating oil, natural gas and electricity.

Greener and fairer
The MIT U.S. Regional Energy Policy (USREP) Model: The Base Model and Revisions

The MIT U.S. Regional Energy Policy (USREP) Model has been broadly applied to energy and environmental policy analyses.  We provide an overview of the base model, detailed description of the equilibrium structures and main features that drive the dynamic process of the economy growing out to 2050.  Given the common features shared between USREP and the MIT Economic Projection and Policy Analysis (EPPA) model, a large part of the description is drawn from EPPA documentation.  We also extract from previous literatures the description of several features developed for USREP.  The objective of this report is to build a reference point for future development of USREP.  Thus revisions to improve the representation of the U.S. economy and energy market are documented in addition to the base model description.

Amid rollbacks of the Clean Power Plan and other environmental regulations at the federal level, several U.S. states, cities and towns have resolved to take matters into their own hands and implement policies to promote renewable energy and reduce greenhouse gas emissions.  One popular approach, now in effect in 29 states and the District of Columbia, is to set Renewable Portfolio Standards (RPS), which require electricity suppliers to source a designated percentage of electricity from available renewable power generating technologies.

Shift to renewable electricity a win-win at statewide level

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