A contrastive analysis of different carbon policies in a multi-plant location problem

This paper addresses a multi-plant location problem, and compares the carbon policies issued by the government with that of joint implementation of the government-issued carbon policies and the market adjustment based carbon policy (carbon trade), where the government-issued carbon policies include carbon tax, as well as command-and-control regulation. A mixed-integer mathematical model is set up, followed by the numerical studies. It is shown by sensitive analysis that, the concurrent implementation of both the government-issued carbon policy and the market adjustment based policy outperforms merely government-issued carbon policies or merely market adjustment based policy , since it benefits not only the enterprises in terms of cost minimization; it also benefits the government since the carbon emission quantity can be minimized.