UK Accounting Glossary
The abatement cost is a cost that is paid by a business when they have been asked to reduce or remove any negative by products or negative nuisances that are created during, at or after the time of production.
The abatement cost can be defined as being the total cost or even cost per unit of achieving a target or goal.
In environmental terms the abatement cost is the cost of achieving a reduction of pollution.
The marginal abatement cost ought to be equated with the marginal benefit to ascertain an efficient reduction of pollution.
The idea of abatement cost is applicable to the actions of businesses or the actions of consumers and the pollution these actions generate.
A cost incurred by companies for the removal or reduction of a negative byproduct they themselves have created; for example, the fees required for an oil refinery to clean up its own pollution.
An abatement cost refers to the cost associated with the voluntary or compulsory removal of an undesirable result of a production process.
Abatement costs are often an indirect outcome of government-imposed regulations intended to benefit the greater community and/or environment. In this context, they represent, albeit by necessity, a source of economic inefficiency somewhat similar in nature to a tax.
Abatement cost is the cost of reducing environmental negatives such as pollution.
The most cost-effective strategy depends on the polluter’s marginal abatement cost and the market price of permits.
A worldwide carbon tax would result in an uneven burden of abatement costs across the world and would change with time.
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This glossary post was last updated: 27th January 2019.