DEA-based Carbon Emission Allowance Allocation Modeling and Application

The method of achieving the 12th Five-Year Plan’s carbon emission reduction goal becomes an important issue in the field of energy and economic policy. Regional carbon emission allocation is proved to be an effective way to solve this problem. This paper proposes a DEA-CEA (DEA based Carbon Emission Allocation) model for carbon emission allowance allocation in China. The DEA-CEA, which is efficiency-oriented and subjected to population proportion, addresses the problem of distributing the national carbon emission permit among the provinces by treating the permit as a kind of fixed total cost. Both efficiency and fairness are considered in the DEA-CEA model. Two provincial allocation scenarios are proposed based on the data of 2010. The results show that, under the same production level and same emission reduction constraint, the DEA-CEA model has a better performance. Firstly, DEA-CEA model provides an emission reduction scheme with a lower cost. Secondly, such scheme can effectively reflect the characteristics of different regions and balance the regional economic development. Thirdly, the difference on the emission reduction burdens between different regions are reduced under DEA-CEA model, and therefore the related emission reduction policy is more enforceable.