Multi-period equilibrium modeling planning framework for tradable credit schemes

• Propose a multi-period TCS planning framework to achieve system-level goals.
• Multi-period TCS dampens the credit price volatility during the planning horizon.
• Investigate the effects of two regulatory instruments on the equilibrium credit price.
• Transfer fee enables the central authority to mitigate the risk of credit hoarding.
• Reservation credit price dampens credit price volatility while reducing credit consumption.

This study proposes the concept of multi-period tradable credit scheme (TCS) for a planning context. In it, travelers determine their actions in terms of consumption or sale of credits in the current period or transfer to future periods. In the first scheme, travelers can transfer credits to future periods without penalty. In the second scheme, the effects of two regulatory instruments are investigated on the market behavior. Study insights suggest that a multi-period TCS dampens credit price volatility. It allows the central authority to develop TCSs with stable credit prices in which travelers can hedge against potential monetary losses.