Microeconomics, on Cardon tax

Relevant information : Tietenberg(2010) " The Evolution of Emission Trading", see

https://www.aeaweb.org/annual_mtg_papers/2008/2008_90.pdf

(a) Consider the offset policy discussed in the chapter:

i) Is there a simple economic model (i.e. an exercise question) to explain how the offset policy works?

ii) What are the reasons for which the program was not very successful?

(b) Now consider the sulfur allowance program discussed in the chapter.

i) Tietenberg claims that including an emission-trade program reduced the compliance cost and therefore made politically possible the passage of the law. why the compliance cost is reduced? Use a simple example (simple model)

ii) Why the EPA decided to use an auction market to allocate (some) of the allowances (permits)?

iii) Why were the utilities against the use of an auction market to allocate the allowances (per- mits)? Use a simple example to explain this (simple model)

iv) How a "zero-revenue" auction was supposed to help to achieve the goal of the sulfur al- lowance program without imposing too much cost for the utilities? Use a simple example to explain this (simple model).