Water pollutant discharge permit allocation based on DEA and non-cooperative game theory

Responsibility-sharing and compensation scheme of transboundary water pollution embodied in China's inter-provincial trade: a perspective from economic value capturing

Transboundary water pollution induced by inter-regional trade is a complex and challenging issue due to the multiple jurisdictions involved. This study combined water pollution discharge inventory, multi-regional input-output analysis, discharge responsibility-sharing, and ecological compensation model to advance the collaborative control of water pollution embodied in China's inter-provincial trade. Over a fifth of China's water pollution discharges in 2017, equivalent to 1376 Kt, were a result of inter-provincial trade, which primarily flowed from wealthier coastal provinces to less developed ones. Moreover, the analysis demonstrates a mismatch between economic gains and environmental costs. In particular, Jiangxi and Guangxi bear the greatest environmental impact (64 and 58 Kt, respectively) while only receiving meager economic returns (131 and 80 billion Yuan). The economic benefit shared responsibility results for the great majority of provinces fell between production- and consumption-based discharges, and this compromise-based allocation of responsibility is more likely to gain acceptance across various regions. Provinces such as Shanghai, Jiangsu, and Beijing necessitate the highest compensation volumes to others, with 31 Kt, 25 Kt, and 20 Kt, respectively, while provinces including Guangxi, Jiangxi, and Ningxia require the largest inflows of compensation, totaling 26 Kt, 23 Kt, and 18 Kt, respectively. The compensation outcomes ensure that less developed regions, bearing a greater pollution burden, receive compensation from more developed regions with lower pollution burdens. The compensation values aligned with compensation volumes, with a few exceptions driven by variations in shadow prices of water pollution. Our study sheds light on the inter-provincial water pollution burdens and benefits and provides a quantitative basis for optimizing the responsibility-sharing and compensation strategies in China, thereby promoting regional cooperation on water pollution control.

Plants' emission behaviors under dual control of pollutant concentration and quantity

Quantity-based and concentration-based limits are two common environmental permitting approaches utilized by government worldwide in environmental management. While existing literature is still unambiguous about roles played by quantity-based versus concentration-based limits in environmental management, it becomes evident that relying exclusively on concentration-based or quantity-based limits to control plant emissions may not necessarily result in improved environmental quality. This paper leverages a unique opportunity arising from a recent reform in China's Pollutant Emission Permit System (PEPS) initiated in 2016 to analyze how the introduction of quantity-based limits in addition to concentration-based limits through the PEPS reform impact emissions at the plant level. Utilizing a unique plant-level continuous emission monitoring system data collected from Shaanxi Province (located in western China), the paper finds a significant reduction in air pollutant emissions as a result of the PEPS reform (nitrogen oxides (NOx) by 39%, sulfur dioxide (SO2) by 15% and particulate matter (PM) by 13%). The heterogeneity analyses show emission reductions in plants differ across those with varying quantity limits specified in their permits, distinct emission ratios and diverse ownership structures. Furthermore, plants that fall under the classified management system with more stringent regulations imposed, especially those operating in high-pollution sectors, situated within industrial parks, or classified as large-sized plants, attain higher pollutant quantity limits. Findings of the paper carry important implications for effective environmental management, particularly within developing countries, and shed some light on carbon emission reduction policies in China.

Collaborative optimal allocation of water resources and sewage discharge rights in watershed cities: considering equity among water sectors

Water supply systems in watershed cities face challenges due to increasing water demand and arbitrary sewage discharge allocations. Previous studies have primarily focused on water resource allocation and sewage discharge rights, neglecting the intricate interactions between the two. This study introduces a novel approach by integrating sewage discharge rights into the watershed's water resource allocation mechanism. A multi-objective optimization model was developed, employing the Gini coefficient to balance the equitable and economic aspects across various water sectors. This model takes into account the distinct water demands and sewage discharge requirements of different sectors. The findings of this study are as follows: (a) the Gini coefficients for water demand allocation and sewage discharge rights allocation exhibit simultaneous optimization and display consistent trends; (b) when the importance of sewage discharge relative to other water users increases, the return on investment for domestic and industrial water use decreases, but the fairness of water distribution improves; (c) proper allocation of sewage discharge rights can effectively enhance the economic value of agricultural water use. Overall, this strategy has the potential to enhance both the equality and economic benefits of the water supply system while ensuring the sustainable utilization of water and sewage rights in the basin cities.

The optimal choice of environmental tax revenue usage: Incentives for cleaner production or end-of-pipe treatment?

The environmental tax system is effective in pollution abatement. However, levying an environmental tax may be detrimental to economic growth. Reasonable use of environmental tax revenue may achieve both environmental protection and economic growth. This study proposes to earmark environmental tax revenue for pollution treatment. Taking fiscal expenditure theory into consideration, environmental tax revenue usage is divided into transfer expenditure and purchase expenditure. An environmental computable general equilibrium (CGE) model is established to evaluate the effects of environmental tax revenue usage. The optimal choice is to increase the environmental tax rate and simultaneously use tax revenue for cleaner production subsidies and end-of-pipe treatment expenditures. Under the optimal scenario, pollutant retention decreases by 21.45%, and GDP increases by 0.006%. For most regions in China, it is better to raise the environmental tax rate to the middle level of a specified range. Moreover, the government should distribute environmental tax revenue evenly across the expenditure of different environmental protection projects.

Carbon resource reallocation with emission quota in carbon emission trading system

In this study, a two-stage data envelopment analysis approach is developed to examine resource allocation in a real-world carbon emissions trading system. First, this study focuses on the actual participation process of incorporated units in the trading system, where incorporated units will be allocated with a carbon emission quota. Second, we propose a research structure for the carbon trading process with two stages. The first stage is to identify congestion, and the second stage is to trade among the units. We make a sensitivity analysis by considering restrictive parameters on the initial carbon emission quota. Then, we expand the research with a target-setting model that retains production technology from the previous year to set the target output for the following year. The congestion and the trading amount for each unit could be determined in advance. Furthermore, these results are able to anticipate the trading situation and provide valuable recommendations for the production and trading of the analyzed units. Finally, the proposed approach is applied to analyze 13 cities in Hubei Province to investigate their congestion and trading conditions.

Interactive Allocation of Water Pollutant Initial Emission Rights in a Basin under Total Amount Control: A Leader-Follower Hierarchical Decision Model

The initial emission rights allocation is the key measure to achieve the goal of total amount control and deepen the emission trading system. Although many studies have focused on the modeling of initial emission rights allocation, such as using game theory and multi-objective optimization methods, few studies have observed the hierarchical relationship of mutual interference and restriction between watershed management agency and local governments in each subarea during allocation. This relationship directly affects the rationality of the results of regional emission rights allocation. In this study, a leader-follower hierarchical decision model (LFHDM) for allocating initial emission rights in a basin is developed. Based on the bilevel programming approach, the model simulates the interactive decision-making process between the watershed management agency of the upper-level model (LFHDM-U) and the local government of the lower-level model (LFHDM-L) in the allocation under total amount control. A case study of China's Yellow River Basin is conducted to demonstrate the feasibility and practicality of the model. Findings reveal that, compared with the single-level model, the developed LFHDM has higher satisfaction with the allocation scheme. Under different scenarios, the overall satisfaction of the configuration schemes of COD and NH3-N in each province and autonomous region remains above 0.9. In addition, the allocation volumes of COD and NH3-N in each province of the Yellow River Basin in planning year increase with the enhancement of allowable assimilative capacity of water bodies, but the interval gap of satisfaction with allocation schemes gradually narrows. It shows that when the allowable assimilation capacity of a water body is low, the decision-making of the allocation scheme needs to be more cautious. Moreover, for the Yellow River Basin, apart from Qinghai and Sichuan, the task of reducing water pollutants in other provinces in the next few years is very arduous. The average reduction of total COD and NH3-N in the basin is about 48% and 46%, respectively.

Dynamic simulation of industrial synergy optimisation pathways in Beijing-Tianjin-Hebei region driven by water environment improvements

China is promoting the coordinated development of the Beijing-Tianjin-Hebei region as a national strategy project; however, water scarcity and water quality problems will become a bottleneck restricting high-quality development. This study aimed to explore a feasible industrial synergy optimisation pathway to realise the collaborative development of economic growth and water environment improvement, combined with incentives for environmental efficiency improvement and reclaimed water utilisation. Research methods integrate input-output modelling, system dynamics, and multi-objective programming to construct a complex multi-region model. A dynamic simulation measure was adopted to simulate the economic and environmental impacts of different approaches that mix from 2020 to 2030 under water resource environment constraints. According to the simulation results, the annual economic growth rate of the entire region can exceed 6.1%, and the emission intensities of water pollutants decrease by more than 60.0%. In addition, traditional manufacturing industries that achieve cross-regional synergy can still release location advantages without negative environmental impacts. Furthermore, regional collaborative development optimises the allocation of water resources and alleviates water stress. Moreover, the pollutant emission reduction effect of source control in Hebei was more effective than in other cities. Finally, reclaimed water, as the end treatment measure, has the largest marginal effect on improving the trade-off between economic and environmental improvement in the long run. This study provides a new approach for multi-regional industrial synergy development and optimal allocation of resources and contributes to the high-quality development of the watershed.

Will nuclear polluted seafood stop selling in the blockchain-enabled market? Lessons from government punishment and social cognition for retailer's selling

In April 2021, Japan's decision to dump nuclear wastewater into the ocean has raised worldwide attention. Therefore, to focus on seafood safety from firm and government in this event, we construct a game model to explore the technology-enabled ways to resolve conflict from domestic product and polluted product. Our analysis reveals the potential equilibrium strategy for the domestic product only and two types of products, respectively. Moreover, from the perspective of government punishment, the result shows the existing motivation of polluted product in the market. Finally, we also investigate the five aspects to find the changes of market share for domestic product, including customer choice, product freshness, market uncertainty, geographical distance, and shoddy product, respectively. In summary, this research provides management implications to resolve conflict between two types of products and to realize the multi-party balance of interests and technology-enabled value.

Evaluation of Regional Water Resources Management Performance and Analysis of the Influencing Factors: A Case Study in China

Water resources management (WRM) is a global strategic issue. Effectively evaluating WRM performance and analyzing its influencing factors have strong practical significance for improving regional WRM performance. Data envelopment analysis (DEA) is one of the most popular models to measure the efficiency of decision-making units (DMUs). Taking regional WRM performance as efficiency DMUs, this paper proposes the indicator system to quantify WRM performance from the perspectives of resource endowments, economic and technological development, and ecosystem protection. The WRM performance of 31 provincial administrative regions in mainland China from 2013 to 2019 are measured, and the temporal and spatial changes are explored using the window DEA model and the Malmquist index model. Finally, the Tobit model is used to quantitatively analyze the affecting factors. The results indicate that: (1) in 2015 and 2019, WRM performance of Sichuan, Shaanxi, Xinjiang, Inner Mongolia, and Guangxi were slightly higher than that in other years, and the areas with more room for WRM performance improvements were areas with abundant water resources; (2) from 2013 to 2019, China’s overall WRM performance showed a slow rise, and there were obvious fluctuations in 2018; (3) the improvement in WRM performance was primarily the result of an improvement to comprehensive technical efficiency changes (EC), whereas technological progress changes (TC) have largely restricted China’s WRM performance; (4) the main influencing factors of WRM performance in China were as follows: industrial development level, water resources utilization rate, and urban sewage discharge per capita.