Restructuring an electricity sector entails a complex realignment of political and economic institutions, which may both delay and distort the achievement of market conditions that are reasonably competitive. In research and planning for policy interventions in power systems under these varied regulatory environments, typical operational models may neglect important areas in which engineering constraints and political realities combining together can substantially change outcomes, leading to poor understanding of underlying causes of inefficiency and to inappropriate recommendations. We develop tractable formulations of a common power systems model used on a daily basis--the unit commitment optimization--which consider important political factors in the Northeast grid region of China. We demonstrate the importance of these interactions on operations and provide a set of options for researchers to explore further pathways for China's ongoing power system reforms. For example, wind integration, a key policy priority, is inhibited by the interaction of institutions limiting short- and long-term sources of flexibilities in inter-provincial trade.

Projections of the pathways that reduce carbon emission to the levels consistent with limiting global average temperature increases to 1.5°C or 2°C above pre-industrial levels often require negative emission technologies like bioelectricity with carbon capture and storage (BECCS). We review the global energy production potential and the ranges of costs for the BECCS technology.  We then represent a version of the technology in the MIT Economic Projection and Policy Analysis (EPPA) model to see how it competes with other low carbon options under stabilization scenarios. We find that, with a global price on carbon designed to achieve climate stabilization goals, the technology could make a substantial contribution to energy supply and emissions reduction in the second half of the 21^st century. The main uncertainties weighing on bioelectricity with carbon capture and storage are biomass availability at large scale, the pace of improvements in carbon capture technologies, the availability and cost of CO₂ storage, and social acceptance.  Commercial viability would appear to depend strongly on a policy environment, such as carbon pricing, that would advantage it, given the technology costs we assume. Compared to previous studies, we provide a consistent approach to evaluate all of the components of the technology, from growing biomass to CO₂ storage assessment. Our results show that global economic costs and needed carbon prices to hit the stabilization target are substantially lower with the technology available at reasonable costs.

The GOP tax reform, now adopted as the 2017 Tax Cuts and Jobs Act, aimed to cut business taxes to stimulate investment, lower some personal taxes, eliminate deductions and tax credits to help pay for the tax reductions, and reduce the shifting of profits abroad by U.S. companies. Some of these objectives have been achieved, but at the cost of a potentially substantial increase in the fiscal deficit, among other problems. As a result, corrections will be needed in future years.

Many of the Act’s undesirable features reflect its drafters’ inability to come up with sufficient revenue to compensate for the tax reductions. This paper explores a carbon dioxide (CO₂) tax as perhaps the only measure that’s consistent with the declared tax-reform principles of the GOP leadership, likely to draw Democratic support, and large enough to compensate for the Act’s revenue-losing provisions. After summarizing the process that led to the Act and its major shortcomings, the researchers—applying the MIT U.S. Regional Energy Policy (USREP) model—show how, when the Act is opened up for repairs, a CO₂ tax could help correct its flaws while serving environmental goals.