The new sulfur dioxide "Cap and fade" program
Currently, there exists a surplus of allowances at a price of zero. The plants are likely to earn more substantial variable profits and by the time the benefits start to increase the levels of profits start to decrease this is similarly indicated by the supply and demand curves. The demand curve will indicate the level of demand for electricity by consumers while the supply curve will indicate the amount of power that the plants are willing to supply at the prevailing prices. Since the prices of allowances are zero, the producers will tend to supply more to the extent that the ...