GTAP Resources: Resource Display
| GTAP Resource #4945 |
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"ENERGY PRICING POLICY REFORM AND ENVIRONMENTAL QUALITY IN NIGERIA: A CGE APPROACH" by Akinyemi-Babajide, Opeyemi, Philip Alege, Oluseyi Ajayi and Henry Okodua Abstract Environmental problems continues to be prevalent in various forms across the globe, especially with changing climate and the energy sector is one of the sectors identified to significantly contribute to environmental degradation. The environment as one of the pillars of sustainable development is critical. Also, the fact that certain policies could be hampering efforts at driving a low-carbon growth strategy to ensure sustainable development, has resulted to renewed attention on assessing the dynamics of the interaction of the energy sector with the environment. One of these policies is the fuel subsidy policy.Negative influence this subsidy had resulted to clamour for its reform to make energy consumption more efficient. This is a vital component in the transformation of the energy sector in driving sustainable growth/development. This study thus seeks to investigate the consequences of reforming fuel subsidy on carbon emissions in Nigeria over a 5 year period. It adopts the recursive dynamic Computable General Equilibrium (CGE) model based on the 2006 Social Accounting Matrix (SAM). Simulating a partial, gradual and complete removal indicates reduction of emissions only when subsidy removal is partial. Findings show increase in macroeconomic variables when the removal is gradual and complete even though emissions were not negative. Even though, emissions did not fall with a complete removal, the increase was simply marginal. The complete removal recorded the largest increase for government savings and income compared to the other two scenarios. Supporting policies can better manage the trade-off effects observed between economic and environmental indicators. It is recommended that policies on subsidies should be directed at energy services that do not increase emission as against those that result to increase in emission levels. Fuel blending can be a useful alternative to fossil fuel along with renewable energy to ensure a low-carbon growth strategy. |
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- Dynamic modeling - Climate change policy - Economic development - Africa (West) |
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Public Access No documents have been attached. Restricted Access No documents have been attached. Special Instructions No instructions have been specified. |
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Last Modified: 9/15/2023 2:05:45 PM
