Study of emission reduction effects in an electricity market considering carbon emission policies

The paper presents two models based on uniform market pricing to analyze the impact of CO2 emission policies on electricity market and market prices. Results of the model reveals the interaction between total CO2 emission and different CO2 emission prices, as well as the electricity prices in response to these CO2 emission prices. By comparing the effectiveness of two market offering mechanisms in emission reduction, an advanced mechanism is discovered as well as the long term influences it will bring to the power system.