Indonesia Cap-Trade-Tax mechanisme

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Anjar Anjar Adhiyoso (Author)

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carbon market 

Tagged by Anjar Adhiyoso about 1 month ago

carbon pricing 

Tagged by Anjar Adhiyoso about 1 month ago

indonesia 

Tagged by Anjar Adhiyoso about 1 month ago

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Market Mechanisme (Question)

Hi people!, this is my alpha build for system thinking project. i will be happy if someone can give me advice how turtle naturally moves in carbon markets. Thanks!

Posted about 1 month ago

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globals [
  carbon-price        ; ETS carbon price
  government-penalty  ; Penalty value
  RR                  ; Rate of carbon reduction
  delta-output        ; Threshold for output changes
  theta                ; Threshold for selling carbon allowances
]

turtles-own [
  firm-emissions       ; Firm emissions specific to each turtle
  carbon-allowances    ; Carbon allowances specific to each turtle
  mac                  ; Marginal abatement cost specific to each turtle
  emission-trade?      ; Boolean: True if the firm is trading carbon
  emission-reduce?     ; Boolean: True if the firm is reducing emissions
  penalty-accepted?    ; Boolean: True if the firm accepts the penalty
  carbon_int           ; Emission intensity of the firm (tCO2/MWh)
  output               ; Output value of the firm (MWh)
  carbon_emi           ; Yearly carbon emissions (tCO2)
  bal                  ; Carbon balance (carbon emissions minus allowances)
  pro                  ; Current profit
  Cat                  ; Industry category (A, B, C, or D)
  Tec_D                ; Decision to invest in carbon reduction technology
  Trade_D              ; Decision to trade, store, or accept penalty
  A_next               ; Allowance for the next year
  ]

to setup-world
  clear-all
  ;; Create market zones: e.g., green = buy zone, red = penalty zone, blue = sell zone
  ask patches [
    if pxcor < -5 [
      set pcolor green   ; Buy zone
    ]
    if pxcor > 5 [
      set pcolor blue    ; Sell zone
    ]
    if pxcor >= -5 and pxcor <= 5 [
      set pcolor red     ; Penalty zone
    ]
  ]
end 

to setup
  clear-all
  setup-world
  set-default-shape turtles "circle"
  set theta 0.1  ; Example threshold for selling allowances
  ;; Create 50 firms (turtles)
  create-turtles 50 [
    set color one-of [green blue red]   ; Random color for now
    set shape "circle"                  ; Set the shape of the firms
    set size 2                          ; Make turtles bigger so they are visible
    setxy random-xcor random-ycor       ; Randomly position turtles
    set Cat one-of ["A" "B" "C" "D"]   ; Set random industry category
    industry-values                    ; Set initial values based on industry category
    set firm-emissions initial-firm-emissions  ; Using slider value
    set carbon-allowances initial-carbon-allowances  ; Using slider value
        set carbon_emi output * carbon_int ; Initial carbon emissions
    set carbon-allowances (carbon_emi * RR)  ; Allowance is based on reduction target
    set bal carbon_emi - carbon-allowances ; Initial carbon balance
    set pro random 1000                ; Placeholder for profit
    set A_next carbon-allowances       ; Initial next year's allowance
    set emission-trade? false
    set emission-reduce? false
    set penalty-accepted? false
    set Tec_D false                    ; Initially no investment in carbon reduction
    set Trade_D "none"                 ; No trading decision at the start
    ;; Set initial RR (for example, starting at 1.0, or 100%)
    set RR 1.0

  ]
  ;; Set default values for carbon price and penalty
    set carbon-price slider-carbon-price  ; Example default carbon price
    set government-penalty slider-government-penalty ; Example penalty for exceeding allowances
  reset-ticks
end 

to industry-values
  ; Set the firm-specific values based on the industry category
  if Cat = "A" [
    set mac 392.7 * (5 / 6.6)           ; MAC for Type A
    set carbon_int 0.911                ; Emission intensity for Type A
    set output random 2000000 + 400000         ; Random output for Type A
  ]

  if Cat = "B" [
    set mac 392.7 * (10 / 11.06)        ; MAC for Type B
    set carbon_int 1.011                ; Emission intensity for Type B
    set output random 1500000 + 300000         ; Random output for Type B
  ]

  if Cat = "C" [
    set mac 392.7 * (15 / 15.61)        ; MAC for Type C
    set carbon_int 1.089                ; Emission intensity for Type C
    set output random 1000000 + 200000         ; Random output for Type C
  ]

  if Cat = "D" [
    set mac 392.7 * (20 / 19.25)        ; MAC for Type D
    set carbon_int 1.297                ; Emission intensity for Type D
    set output random 1000000 + 100000         ; Random output for Type D
  ]
end 

to go
  ;; Firms make decisions and interact in the market
  ask turtles [
    make-decisions
    calculate-carbon-balance
    make-trade-or-penalty-decisions
  ]
  ;; Reduce RR by 2% every tick
  set RR RR * 0.98  ; Decrease RR by 2%

  ;; Update the movement and visualization based on decisions
  move-firms
  update-firm-visualization

  ;; Gradually adjust emissions (simulate production and reduction over time)
  ask turtles [
    if emission-reduce? [
      set firm-emissions firm-emissions * 0.98  ; Decrease emissions by 2% if reducing emissions
    ]
      set firm-emissions firm-emissions * 1.01  ; Increase emissions by 1% due to production

  ]
  ;; Plot and other updates
  update-carbon-price
  update-decision-plot

  tick
end 


; Calculate the carbon emissions and decide whether to reduce emissions

to make-decisions
  let predicted-emissions output * carbon_int  ; Calculate emissions based on output and intensity

  ;; Condition 1: Reduce emissions if MAC is less than carbon price and firm is not already reducing
  if (mac < carbon-price) and (not emission-reduce?) [
    set Tec_D true                     ; Invest in technology to reduce emissions
    set emission-reduce? true          ; Mark that the firm is reducing emissions
    reduce-emissions
  ]
  if (emission-reduce? and firm-emissions <= carbon-allowances) [
    set emission-reduce? false         ; Stop reducing emissions when under allowance
  ]
end 

to reduce-emissions
  set firm-emissions (firm-emissions - random-float 2)  ; Reduce emissions by a random factor
end 


; Calculate carbon balance (Eq. 4)

to calculate-carbon-balance
  set carbon_emi output * carbon_int   ; Calculate actual carbon emissions
  set carbon-allowances carbon_emi * RR ; Allowances decrease based on RR
  set bal carbon_emi - carbon-allowances ; Calculate carbon balance
end 

; Make decisions on trading or accepting penalties based on carbon balance

to make-trade-or-penalty-decisions
  ;; Check if emissions exceed allowance
  if (bal > 0) [
    ;; Calculate purchase cost and penalty cost
    let purchase-cost bal * carbon-price
    let penalty-cost bal * government-penalty  ; Penalty is proportional to excess emissions

    ;; Print the costs for debugging purposes
    print (word "Turtle " who " - Purchase Cost: " purchase-cost " vs Penalty Cost: " penalty-cost)

    ;; Condition 3: Buy allowances if it's cheaper than the penalty
    ifelse (purchase-cost < penalty-cost) [
      set Trade_D "buy"
      trade-carbon
      set penalty-accepted? false
      print (word "Turtle " who " is buying allowances.")
    ] [
      ;; Condition 4: Accept penalty if buying allowances is more expensive
      set penalty-accepted? true
      set Trade_D "none"
      print (word "Turtle " who " is accepting penalty.")
    ]
  ]
  ;; Condition 5 & 6: Sell or store extra allowances if emissions are below allowance
  ifelse ((abs(bal) > (A_next - carbon-allowances)) and (abs(bal) * carbon-price > pro * theta)) [
    set Trade_D "sell"
    sell-allowances
    print (word "Turtle " who " is selling allowances.")
  ] [
    ;; Condition 6: Store allowances for the next period if selling is not profitable
    set Trade_D "store"
    print (word "Turtle " who " is storing allowances.")
  ]
end 


; Procedure to trade allowances (buy or sell)

to trade-carbon
  if (Trade_D = "buy") [
    set carbon-allowances (carbon-allowances + random-float 1)  ; Buy allowances
    set pro (pro - carbon-price * bal)  ; Decrease profit by the cost of allowances
  ]
end 

to sell-allowances
  set carbon-allowances (carbon-allowances - random-float 1)  ; Sell extra allowances
  set pro (pro + carbon-price * abs(bal))  ; Increase profit by selling allowances
end 

to trade-between-firms
  ask turtles with [Trade_D = "buy"] [
    let seller one-of turtles with [Trade_D = "sell"]
    if seller != nobody [
      ; Execute trade (exchange allowances and update profit)
      ask seller [
        set carbon-allowances carbon-allowances - 1
        set pro pro + carbon-price
      ]
      set carbon-allowances carbon-allowances + 1
      set pro pro - carbon-price
    ]
  ]
end 

; Apply penalty to firms that exceed their carbon allowances

to apply-penalty
  if (penalty-accepted?) [
    set pro (pro - government-penalty)
  ]
end 

; Procedure to update carbon price based on trading activity

to update-carbon-price
  ; Carbon price influenced by trading decisions, emissions, and supply-demand dynamics

  ;; Calculate the number of firms buying and selling allowances
  let total-buyers count turtles with [Trade_D = "buy"]
  let total-sellers count turtles with [Trade_D = "sell"]
  let total-traded total-buyers + total-sellers  ; Total market activity (both buying and selling)

  ;; Adjust carbon price based on market supply and demand (buyers increase, sellers decrease)
  let price-adjustment (total-buyers - total-sellers) * 0.1  ; Small adjustment factor

  ;; Calculate total emissions (sum of all firm emissions)
  let total-emissions sum [firm-emissions] of turtles

  ;; Add random fluctuation to simulate market volatility
  let random-fluctuation (random-float 0.05) - 0.025  ; Random fluctuation between -0.025 and +0.025

  ;; Update the carbon price based on trading, emissions, and market fluctuation
  set carbon-price (carbon-price + price-adjustment + (total-traded * 0.1) + (total-emissions * 0.001) + random-fluctuation)

  ;; Ensure the carbon price stays above a minimum value (e.g., 1.0)
  if carbon-price < 1.0 [ set carbon-price 1.0 ]

  ;; Print the new carbon price for debugging (optional)
  print (word "New carbon price: " carbon-price)
end 

to update-visualization
  ask turtles [
    ; Color and shape based on emissions status and decision to reduce emissions
    ifelse (firm-emissions > carbon-allowances) [
      set shape "triangle"   ; Firms with excess emissions become triangles
      set color red          ; Indicating high emissions
    ] [
      set shape "circle"     ; Firms with low emissions stay as circles
      set color green
    ]

    ; Change color if the firm is trading carbon
    if (emission-trade?) [
      set color yellow       ; Firms that are actively trading become yellow
    ]

    ; Indicate if the firm has accepted a penalty
    if (penalty-accepted?) [
      set color gray         ; Firms that have accepted penalties become gray
    ]
  ]
end 

to move-firms
  ask turtles [
    ;; Move to buy zone if trading
    if Trade_D = "buy" [
      let target-patch one-of patches with [pcolor = green]
      if target-patch != nobody [
        move-to target-patch
      ]
    ]

    ;; Move to sell zone if selling
    if Trade_D = "sell" [
      let target-patch one-of patches with [pcolor = blue]
      if target-patch != nobody [
        move-to target-patch
      ]
    ]

    ;; Move to penalty zone if accepting penalty
    if penalty-accepted? [
      let target-patch one-of patches with [pcolor = red]
      if target-patch != nobody [
        move-to target-patch
      ]
    ]
  ]
end 

to update-firm-visualization
  ask turtles [
    ;; If firm is buying, turn blue and make it a square
    if Trade_D = "buy" [
      set shape "square"
      set color blue
    ]

    ;; If firm is selling, turn green and make it a triangle
    if Trade_D = "sell" [
      set shape "triangle"
      set color green
    ]

    ;; If firm accepts penalty, turn red and make it a circle
    if penalty-accepted? [
      set shape "circle"
      set color red
    ]

    ;; If firm is compliant and not trading, keep it a gray circle
    if not penalty-accepted? and Trade_D = "none" [
      set shape "circle"
      set color gray
    ]
  ]
end 

to update-decision-plot
  set-current-plot "Firm Decisions"  ; Select the plot

  ; Pen 1: Plot number of firms trading
  set-current-plot-pen "trade"       ; Set the current pen to "trade"
  let num-trade count turtles with [Trade_D = "buy" or Trade_D = "sell"]
  plot num-trade                     ; Plot the number of firms trading

  ; Pen 2: Plot number of firms reducing emissions
  set-current-plot-pen "reduce"      ; Set the current pen to "reduce"
  let num-reduce count turtles with [emission-reduce? = true]
  plot num-reduce                    ; Plot the number of firms reducing emissions

  ; Pen 3: Plot number of firms accepting penalties
  set-current-plot-pen "penalty"     ; Set the current pen to "penalty"
  let num-penalty count turtles with [penalty-accepted? = true]
  plot num-penalty                   ; Plot the number of firms accepting penalties

  set-current-plot "Carbon Price Over Time"
  plot carbon-price  ; Plot the carbon price over time
end 

to update-profit
  ; Profit influenced by emissions, penalties, and trading
  if (emission-trade?) [
    set pro (pro + random-float 100 - (carbon-price * firm-emissions))
  ]
end 

There is only one version of this model, created about 1 month ago by Anjar Adhiyoso.

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