Edenhofer et al. (2023): On the Governance of Carbon Dioxide Removal – A Public Economics Perspective
Ottmar Edenhofer, Max Franks, Matthias Kalkuhl, Artur Runge-Metzger, CESifo Working Paper No. 10370, April 2023, 43 Pages
This paper highlights the importance of carbon dioxide removal (CDR) technologies for climate policy. The authors first describe their role in iconic transformation pathways and discuss removal costs and storage duration of different technologies. Based on economic principles, they characterize optimal removal flows and reservoirs for non-permanent removals. Furthermore, the authors discuss different pricing regimes that achieve an optimal allocation under different information and liability conditions.