Impacts of market-based climate change policies on the US pulp and paper industry

Much of the policy debates on climate issues have centered on the optimal l evel and timing of policy interventions that cost-effectively reduce greenh ouse gas emissions. We briefly review the range of policy issues in our pap er and assess the impact that climate-change policies may have on energy us e and carbon emissions in the US pulp and paper industry. We then present r esults from time series-based analyses of changes in technologies and fuel mix, and compare the results with engineering-based technology analyses of US pulp and paper production (for a copy of the model and software send e-m ail to mruth@bu.edu.). Projections, based on information for eight paper an d paperboard categories, are presented for the years 1995-2020. The finding s indicate that, under a wide range of specifications and policy assumption s, carbon emissions from fossil fuel use per ton of product are likely to d ecline. When combined with investment incentives, an additional cost-effect ive reduction in carbon emissions per ton of product will be realized. Howe ver, expected increases in output from the industry are likely to be higher than the reductions in energy and carbon intensities. The policy implicati ons of these findings are discussed. (C) 2000 Elsevier Science Ltd. All rig hts reserved.