|
on Energy Economics |
| By: | Reedman, Luke; Graham, Paul |
| Abstract: | Bottom up partial equilibrium modelling of the energy sector has tended to focus on the electricity sector given its typically large share of total emissions, the deregulation of that market in many countries and the relatively well understood technology options. In contrast, this paper employs a model of the energy sector to investigate the proportion electricity and transport may contribute given the relative cost of abatement in those sectors, for specified emission targets. A related issue is the potential convergence of the two sectors through greater uptake of electrically powered transport. |
| Keywords: | Energy, Emissions trading, Electricity and transport, integrated modelling, Environmental Economics and Policy, Public Economics, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aare08:6042&r=ene |
| By: | Boronowski, S.; Monahan, K.; van Kooten, G.C. |
| Abstract: | Renewable solar, tidal and wind energy have the potential of reducing dependency on fossil fuels and their environmentally negative impacts. Because of their variability, wind and solar energy in particular impose added costs on electrical grids as system operators attempt to balance operation of existing thermal power plants. In this regard, tidal stream power has an advantage over solar and wind energy as tides are predictable and comparatively regular; yet, tides remain intermittent and thereby still may create inefficiencies to the grid. In this paper, we develop a dynamic optimization framework for analyzing the allocation of power output across generating sources when tidal and wind power are added to the system. In particular, we minimize the cost of satisfying the 2006 British Columbia electricity demand. We use tidal current and wind data from sites around Vancouver Island to estimate the effects of an increase in renewable energy penetration into grids consisting of three typical generating mixes Â€Ó the British Columbia generation mix that has a significant hydropower component, the Alberta generating mix with a coal-fired power dominance, and the Ontario generation mix which includes significant nuclear and coal-fired generation. Simulation results over an entire year (hourly time step) indicate that the cost of electricity will increase from its current levels by between 73% and 150% at renewable penetration rates of 30% depending on the assumed generating mix. The cost of reducing CO2 emissions ranges from $97.47 to $1674.79 per tonne of CO2, making this an expensive way of mitigating emissions. The reasons for these high costs are increased inefficiencies from standby spinning reserves and operation of plants at less than optimal levels (so that more fuel is burned per unit of electricity). Further, it is impossible to determine the displacement of emissions by renewable energy without considering the complete operating system. |
| Keywords: | renewable energy, electrical grids, mathematical programming models, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44260&r=ene |
| By: | Chebbi, H.E.; Boujelbene, Y. |
| Abstract: | The aim of this country specific study is to understand long and short-run linkages between economic growth, energy consumption and CO2 emission using Tunisian data over the period 1971-2004. Statistical findings indicate that economic growth, energy consumption and CO2 emission are related in the long-run and provide some evidence of inefficient use of energy in Tunisia, since environmental pressure tends to rise faster than economic growth. In the short run, results support the argument that economic growth exerts a positive €ܣausalÂ€Ý influence on energy consumption growth. In addition, results from impulse response do not confirm the hypothesis that an increase in pollution level induces economic expansion. Although Tunisia has no commitment to reduce Greenhouse Gas emissions, energy efficiency investments and emission reduction policies will not hurt economic activities and can be a feasible policy tool for Tunisia. |
| Keywords: | CO2 emissions, Energy Consumption, Economic Growth, Tunisia, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44016&r=ene |
| By: | Hubert, Marie-Helene; Chakravorty, Ujjayant; van Kooten, G. Cornelis |
| Abstract: | In the context of ever-increasing petroleum prices combined with concerns about climate change, timing of adoption and rate of diffusion of land-based fuels and backstop technologies for transportation use are examined in this paper. A global model of land allocation joined with a Hotelling model has been developed. Using this framework, effects of climate and energy policies on world agricultural and energy markets have been explored. Further, their regional impacts are also analyzed. Whereas mandatory blending bio-fuels have substantial effects on world food prices and do not succeed in curbing down carbon emissions fluxes, carbon targets are expected to speed up date of adoption of backstop technologies. Then, sensitivity scenarios with regards to technological parameters reveal that higher is the rate of technological change, earlier backstop technologies are adopted and lower is the stock of carbon accumulated into the atmosphere. Finally, interplay between land-based fuels and deforestation has been studied. Results show that land-based fuels production speeds up world deforestation and causes substantial carbon emissions due to conversion of forests into agricultural lands. |
| Keywords: | Ricardian rents, land use, biofuels, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44259&r=ene |
| By: | van Kooten, G.C. |
| Abstract: | Under Kyoto, biological activities that sequester carbon can be used to create CO2 offset credits that could obviate the need for lifestyle-changing reductions in fossil fuel use. Credits are earned by storing carbon in terrestrial ecosystems and wood products, although CO2 emissions are also mitigated by delaying deforestation, which accounts for one-quarter of anthropogenic CO2 emissions. However, nonpermanent carbon offsets from biological activities are difficult to compare with each other and with emissions reduction because they differ in how long they prevent CO2 from entering the atmosphere. This is the duration problem; it results in uncertainty and makes it difficult to determine the legitimacy of biological activities in mitigating climate change. While there is not doubt that biological sink activities help mitigate climate change and should not be neglected, in this paper we demonstrate that these activities cannot be included in carbon trading schemes. |
| Keywords: | carbon offset credits, climate change, duration of carbon sinks, Environmental Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44262&r=ene |
| By: | EHRENMANN, Andreas (Electrabel); SMEERS, Yves (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE)) |
| Abstract: | Former generation capacity expansion models were formulated as optimization problems. These included a reliability criterion and hence guaranteed security of supply. The situation is different in restructured markets where investments need to be incentivised by the margin resulting from electricity sales after accounting for fuel costs. The situation is further complicated by the payments and charges on the carbon market. We formulate an equilibrium model of the electricity sector with both investments and operations. Electricity prices are set at the fuel cost of the last operating unit when there is no curtailment, and at some regulated price cap when there is curtailment. There is a CO2 market and different policies for allocating allowances. Todays situation is quite risky for investors. Fuel prices are more volatile than ever; the total amount of CO2 allowances and the allocation method will only be known after investments has been decided. The equilibrium model is thus one under uncertainty. Agents can be risk neutral or risk averse. We model risk aversion through a CVaR of the net margin of the industry. The CVaR induces a risk neutral probability according to which investors value their plants. The model is formulated as a complementarity problem (including the CVaR valuation of investment). An illustration is provided on a small problem that captures the essence of today electricity world: a choice restricted to coal and gas, a peaky load curve because of wind penetration, uncertain fuel prices and an evolving carbon market (EU-ETS). We show that we might have problem of security of supply if we do not implement a capacity market. |
| Keywords: | capacity adequacy, risk functions, stochastic equilibrium models |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2008007&r=ene |
| By: | Kempen, Markus; Kraenzlein, Tim |
| Abstract: | Agricultural production requires significant input of fossil fuels and other energy sources leading to negative external effects like emissions of CO2. Measures to discourage energy consumption in the agricultural sector are contemplated upon and might increase costs of production activities. At the same time, energy cost rise due to market developments, also affecting the relative competitiveness of agricultural activities in favor of low energy input sub-sectors. Increasing energy related cost could reduce total energy consumption, but the extent of the reduction is uncertain. The effects of increasing energy costs in EU27 on market quantities and prices as well as energy use in the agricultural sector will be investigated using the agricultural sector model CAPRI which was recently extended by an energy indicator related to production activities. This paper intends to demonstrate the functionality of a large scale agricultural sector model in simulations with respect to energy use. |
| Keywords: | Energy Use in Agriculture, Energy Cost, Agricultural Sector Model, Production Economics, Research Methods/ Statistical Methods, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6652&r=ene |
| By: | Tokgoz, Simla |
| Abstract: | The objective of this study is to analyze the impact of crude oil prices on the EU-27 agricultural sector in an era when the biofuels sector is expanding because of the policy initiatives taken by the EU Commission and member states. To this end, first a baseline is set up for the EU-27 ethanol, grain, and dried distillers grains markets. In the next step, two different scenarios are run. The first scenario incorporates a $10- per-barrel increase in the EU-27 crude oil price with the ethanol import tariffs in place. The second scenario incorporates the same shock with the ethanol import tariffs removed. In the first scenario, higher crude oil prices increase ethanol consumption, production, and therefore grain prices. In the second scenario, the impact of trade liberalisation is larger than the impact of the higher crude oil price. So, grain prices decline in this scenario despite an expansion in ethanol consumption. If there were a high enough crude oil price shock, which would affect the EU-27 ethanol market more than trade liberalisation, the net impact on grain, feed, and food prices from the crude oil price shock would be mitigated by the increased trade from trade liberalisation. The study shows that the impact of energy prices on the EU-27 agricultural sector is increasing with the emergence of the biofuels sector. It also illustrates the importance of trade policy in responding to higher crude oil and grain prices. |
| Keywords: | Ethanol, energy prices, trade liberalisation, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44241&r=ene |
| By: | Peri, M.; Baldi, L. |
| Abstract: | In this paper we analyse the long-run relationships between vegetable oils prices and conventional diesel price in EU during the period 2005- 2007. We utilise recent developments on threshold cointegration approach to investigate if asymmetric dynamic adjusting processes exist among rapeseed oil, sunflower oil, soybean oil and diesel prices. The results suggest that the two-regime threshold cointegration model exist only in favour of rapeseed oil-diesel price pair. Therefore, this vegetable oil price adjusts rapidly to its long run equilibrium, determined by fossil diesel prices, in an asymmetric manner when the divergence between the two prices is above a critical threshold. Consequently, rapeseed oil seems to be particularly exposed to exogenous shocks deriving from global political scenarios, suggesting to redefine the high quota (80%) of EU biodiesel produced by this vegetable oil through a sustainable development of international trade. |
| Keywords: | Vegetable oils market, Biodiesel price, Threshold cointegration., Marketing, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:43971&r=ene |
| By: | Lennox, J.A.; Andrew, R.; Forgie, V. |
| Abstract: | Implementation of a New Zealand Emission Trading Scheme (NZ ETS) will begin in 2008, beginning with forestry, subsequently including energy and industrial emissions, and finally, agricultural GHGs from 2013. Reducing agricultural emissions is a major challenge for New Zealand as they account for over half its total GHG emissions. On the other hand, agriculture is critical to the economy, with its basic and processed products accounting for a third of exports. We use an environmental input-output model to analyse direct and indirect cost impacts of emissions pricing on food and fibre sectors. At NZ $25/t CO‚eq, costs of energy-related emissions on the food and fibre sectors are very small; however, costs of agricultural emissions post 2013 would substantially impact on sheep, beef and dairy farming. Costeffective mitigation measures and land use changes should help reduce micro- and macroeconomic impacts, but the latter may also risk 'emissions leakage'. |
| Keywords: | emissions trading, input-output price model, agricultural greenhouse gases, Demand and Price Analysis, Environmental Economics and Policy, Land Economics/Use, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6678&r=ene |
| By: | OGGIONI, Giorgia (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE)); SMEERS, Yves (Université catholique de Louvain (UCL). Center for Operations Research and Econometrics (CORE)) |
| Abstract: | The inception of the Emission Trading System in Europe (EU-ETS) has made power price more expensive. This affects the competitiveness of electricity intensive industrial consumers and may force them to leave Europe. Taking up of a proposal of the industrial sector, we explore the possible application of special contracts, based on the average cost pricing system, which would mitigate the impact of CO2 cost on their electricity price. The model supposes fixed generation capacities. A companion paper treats the case with capacity expansion. We first consider a reference model representing a perfectly competitive market where all consumers (households and industries) are price-takers and buy electricity at the short-run marginal cost. We then change the market design assuming that large industrial consumers pay power either at a single or at a nodal average cost price. The analysis of these problems is conducted with simulation models applied to the Northwestern European market. The equilibrium models developed are implemented in the GAMS environment. |
| Keywords: | average cost pricing, complementarity conditions, EU-ETS, Northwestern Europe market. |
| Date: | 2008–01 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2008001&r=ene |
| By: | Becker, A. |
| Abstract: | Biomass based energy production has attained a significant market share within the developing renewable energy market. In comparison to alternative renewable energy sources, biomass has several special features: it is not inexhaustible in the short term (limitation of arable land) and it is not only an energy source. Other usages like food or feed compete with energy production for this resource. A number of problems arise which have a direct impact on the fulfillment of policy objectives which are connected with its promotion. Primarily, the production of bioenergy has significant impacts on coupled biomass markets. Further, a change in production intensity or arable land use increases the use of nutrient loads and agro - chemicals. When evaluating renewable energy production, the wide range of political objectives has to be considered. Therefore, the focus of the overall study will be on three objective areas: promotion of the agricultural sector, environmental protection (reduction of GHG emissions) and maintenance of food supply security. The objective of this study is to combine an analysis of selected economic and ecological impacts of an increased biomass based energy production (primarily biofuels) under the assumption of European and international quantity targets by adjusting and applying the agricultural sector model CAPRI (Common Agricultural Policy Regional Impact Analysis). This poster intends to display the methodical approach of the intended analysis. |
| Keywords: | Bioenergy, Biofuels, Biomass production, Impact analysis., Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:43974&r=ene |
| By: | ZOETTL, Gregor |
| Abstract: | In this article we analyze firms investment incentives in liberalized electricity markets. Since electricity is economically non storable, it is optimal for firms to invest in a differentiated portfolio of technologies in order to serve strongly fluctuating demand. Prior to the Liberalization of electricity markets, for regulated monopolists, optimal investment and pricing strategies haven been analyzed in the peak load pricing literature (compare Crew and Kleindorder (1986)). In restructured electricity markets regulated monopolistic generators have often been replaced by competing and potentially strategic firms. This article aims to respond to the changed reality and model investment decisions of strategic firms in those markets. We derive equilibrium investment for strategic firms and compare to the benchmark cases of perfect competition and monopoly outcomes. We find that strategic firms have an incentive to overinvest in base-load technologies but choose total capacities too low from a welfare point of view. By fitting the framework to a specific electricity market (Germany) we are able to empirically analyze Investment choices of strategic firms, and quantify the potential for market power and its impact on generation portfolios in restructured electricity markets in the long run. |
| Keywords: | Investment decisions, technology choice, restructured electricity markets, peak load pricing, strategic firms. |
| Date: | 2008–07 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2008041&r=ene |
| By: | Gay, Stephan Hubertus; Mueller, Marc; Santuccio, Federica |
| Abstract: | The European Commission proposes a minimum of 10 % biofuels in the total transport fuel use by 2020. The new 10% minimum target in 2020 is combined with the existing regulation, which fixes the target at 5.75% in 2010. This paper will in particular investigates how a full implementation of the 20- 10-20 targets would affect production and trade of oil plants in the EU and its main trade partners on this commodity markets, particularly Malaysia and Indonesia. The global general equilibrium model GLOBE is used to carry out the policy scenarios and to assess the effects on oil palm plantation area in Malaysia and Indonesia. The results show that the increased EU bio-diesel target will not significantly influence the expansion of palm oil production in Indonesia and Malaysia. |
| Keywords: | Crop Production/Industries, International Relations/Trade, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6495&r=ene |
| By: | MURATORE, Gabriella (Technische Universiteit Eindhoven) |
| Abstract: | In this paper we address the issue of finding efficient partial equilibria in markets with non-convexities. This is a problem that has intrigued generation of economists. Beside its theoretical importance this issue is fundamental in energy markets which do not give the right price signals and incentives to maintain existing and invest in new generating capacity. By considering a competitive environment in which consumers maximize utility independently of other agents actions while suppliers are profit maximizers given other market agents actions, we are able to find efficient prices in markets with non-convexities. Based on this result we propose a design for an energy-only market able to give investors the correct price signals. |
| Keywords: | energy markets, equilibrium prices, non convex economies. |
| Date: | 2008–02 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2008006&r=ene |
| By: | Rinne, J.; Lankoski, J.; Ollikainen, M. |
| Abstract: | The European Union€ٳ Emission Trading Scheme (EUETS) and the current renewable resource program provide strong incentives to use agricultural crops either for combustion in power plants to produce electricity and heat or as a feedstock for transportation fuels. In this paper we examine the social desirability of ethanol production from agricultural crops. To endogenize the competition on land use, we employ a Ricardian model of heterogeneous land quality, where land is allocated to alternative crops on the basis of their relative profitability. The model comprises three land use types: bioenergy crop, conventional feed crop and green setaside. Industry demands crops for both ethanol and feed production. Effects on the GHG balance are explicitly taken into account in the analysis. Theoretical model characterises both the private and social optima and examines endogenous price effects. Theoretical framework is applied to barley production in Finland. We found that the socially optimal demand for barley is 13.3 % higher than demand obtained in the private optimum. This implies shifts in land allocation, fertilizer intensity and prices. Considering the climate impacts of crop cultivation, the land area devoted to green setaside greatly increases in the social optimum as compared with the private optimum. |
| Keywords: | biofuels, agricultural land allocation, heterogeneous land quality, Crop Production/Industries, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44400&r=ene |
| By: | Liu, Xing |
| Abstract: | The goal of this study is to investigate the price relationship of EU biofuel market with other main markets in both horizontal level and vertical level. We first carry out Granger causality between ethanol price of EU, USA and Brazil. Secondly, we use vecto error cointegration Mechnism (VECM) to test the relationship between three selected vegetable oil prices in EU to see the competive potential of EU rapeseed oil compared with imported crude palm oil and soybean oil as the feedstock of biodiesel. Evidence shows that there is a unidirectional Granger causation from both USA and Brazil to EU market. USA price of ethanol is the most influential among the three price series, and EU has the least influence on the contrary. It indicates that it is very necessary for EU to set up its own price indicator, for instance, futures prices in EURONEXT. However, in biodiesel market, production in EU has some potential in competing with outside of the world since rapeseed oil price show some potential in price competition with other vegetable oils. |
| Keywords: | ethanol, vegetable oils, feedstock, directives, VECM, Granger causality, Crop Production/Industries, International Relations/Trade, Research and Development/Tech Change/Emerging Technologies, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6501&r=ene |
| By: | von Ledebur, Oliver; Salamon, Petra; Zimmermann, Andrei; van Leeuwen, Myrna; Tabeau, Andrej; Chantreuil, Frederic |
| Abstract: | Against the background of increasing concerns regarding the energy supply security as well as environmental concern the interest for renewable energy sources has increased in recent years. The biofuel sector, backed by public policies, experienced a strong increase in and outside Europe. A methodology that allows for the estimation of the impacts of the fulfilment of the proposed biofuel targets in the EU member states is proposed and implemented in the AGMEMOD model for France and Germany. The so called normative approach, based on the use of a logistic function as biofuel demand function allows to perform simulations to assess the impact of the biofuel demand expansion on agricultural markets. The implemented approach and the simulation results indicate that crops production would adjust to the modified demand situation and depending on the proposed scenario the domestic supply would not be enough for the achievement of the biofuel targets in France and Germany. |
| Keywords: | biofuel targets, biodiesel, ethanol, modelling, Crop Production/Industries, Public Economics, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6649&r=ene |
| By: | Clancy, Daragh; Breen, James; Butler, Anne Marie; Thorne, Fiona |
| Abstract: | Ireland is currently importing 90 percent of its energy. The burning of domestically produced nonrenewable peat provides 4.9 percent of Ireland€ٳ total primary energy supply while renewable biomass crops currently account for only 1 percent of the domestically produced energy supply. The Irish government have set a target of 30% of peat (approximately 0.9 million tonnes) used for electricity generation to be replaced by renewable energy crops. This would be equivalent to approximately 0.6 million tonnes of biomass crops or approximately 45,000 hectares of biomass. Direct payments and subsidies accounted for over 100 percent of average family farm income on beef and sheep farms in 2006. Therefore there appears to be significant potential for Irish farmers to replace conventional agricultural enterprises with biomass crops. A probit model was built to identify the socio-economic characteristics of farmers who may be willing to adopt energy crop production. The results from this were used in the construction of a linear programming model to determine the optimal enterprise for each farmer at varying energy prices. |
| Keywords: | Willow, Miscanthus, Co-firing, Net present value, Probit, Linear programming, Agricultural Finance, Institutional and Behavioral Economics, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6485&r=ene |
| By: | Meredith Fowlie; Christopher R. Knittel; Catherine Wolfram |
| Abstract: | For political and practical reasons, environmental regulations sometimes treat point source polluters, such as power plants, differently from mobile source polluters, such as vehicles. This paper measures the extent of this regulatory asymmetry in the case of nitrogen oxides (NOx), the criteria air pollutant that has proven to be the most recalcitrant in the United States. We find significant differences in marginal abatement costs across source types with the marginal cost of reducing NOx from cars less than half of the marginal cost of reducing NOx from power plants. Our findings have important implications for the efficiency of NOx emissions reductions and, more broadly, the benefits from increasing the sectoral scope of environmental regulation. We estimate that the costs of achieving the desired emissions reductions could have been reduced by nearly $2 billion, or 9 percent of program costs, had marginal abatement costs been equated across source types. |
| JEL: | Q52 Q58 |
| Date: | 2008–11 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:14504&r=ene |
| By: | ZOETTL, Gregor |
| Abstract: | We analyze the impact of a uniform price cap at electricity spot markets on firms investment decisions and on welfare. Since investment decisions for those markets are taken in the long run, fluctuating demand at the spot market eventually gives rise to high price spikes in case of binding capacities. Those price spikes are considered to send accurate signals for investment in generation capacities, limiting those spikes by price caps is thought to reduce firms' investment incentives. We are able to show that this is not true for the case of strategic investment behavior. More specifically we analyze a market game where firms choose capacities prior to a spot market which is subject to fluctuating or uncertain demand. We derive, that appropriately chosen price caps do always increase firms investment incentives under imperfect competition. We furthermore characterize the optimal price cap. Based on the theoretical framework, we empirically analyze the impact of uniform price caps on the German electricity market. |
| Keywords: | Investment incentives, price caps, fluctuating demand, electricity markets |
| JEL: | D43 L13 D41 D42 D81 |
| Date: | 2008–06 |
| URL: | http://d.repec.org/n?u=RePEc:cor:louvco:2008037&r=ene |
| By: | Chebbi, H.E.; Boujelbene, Y. |
| Abstract: | This short paper investigates the cointegration and causality link between energy consumption and agricultural, non-agricultural outputs (manufacturing sector and services sector) and overall gross domestic product in Tunisia for 1971-2003 period. Empirical results suggest that there is only unidirectional causality running from agricultural and non-agricultural sectors to energy consumption as well as from overall GDP growth to energy consumption. This unidirectional causality signifies a less energy dependent economy and suggests that it is sectoral growth that drives the energy consumption in Tunisia and not vice versa. Empirical results suggest also that Tunisian agricultural sector growth does not depend on energy, and high consumption of energy do not implies more productivity in the short run for this sector. |
| Keywords: | energy consumption, output growth, causality, cointegration, Tunisia, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44055&r=ene |
| By: | Wajszczuk, Karol; Baum, Rafal; Wielicki, Witold |
| Abstract: | The paper presents a concept for a digital platform model for the biomass logistics network for local communities. This concept refers to the strategy for the development of renewable power engineering in Poland to the year 2020, adopted by the Polish government. The status and prospects for biomass production are presented, from which it results that plant production for energy purposes may in the nearest future constitute an important alternative to food production. In turn, main problems connected with the organization of biomass market at the local and regional levels are also discussed. In the proposed model the digital platform would be available on the Internet for all links of the logistics chain, starting from producers and ending with buyers (processors) of biomass. Primary benefits of the implementation of such a system include the development of local energy biomass markets and maintenance of their effective operation; comprehensive utilization of local energy biomass resources for the production of green energy; initiation of an appropriate development of biomass power engineering as an element of sustainable rural development. |
| Keywords: | sustainable agriculture, renewable energy sources, biomass logistics network, Environmental Economics and Policy, Production Economics, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6454&r=ene |
| By: | Joao Ricardo Faria; Andre Varella Mollick; Pedro H. Albuquerque; Miguel Leon-Ledesma |
| Abstract: | The increase in oil prices in recent years has occurred concurrently with a rapid expansion of Chinese exports in the world markets, despite China being an oil importing country. In this paper we develop a theoretical model that explains the positive correlation between Chinese exports and the oil price. The model shows that Chinese growth can lead to an increase in oil prices that has a stronger impact on its export competitors. This is due to the large labor force surplus of China. We then examine this hypothesis by estimating a reduced form equation for Chinese exports using Rodrik (2006)’s measure of export competitiveness, together with the oil price, productivity, real exchange rate, and foreign industrial production over the monthly 1992-2005 period. The results suggest a stable relationship and yields slightly positive values for the price of oil and elastic coefficients for export competitiveness, along with the expected negative elasticity for the real exchange rate. |
| Keywords: | China; Oil prices; Competitiveness; Exports; Productivity |
| JEL: | F14 F43 |
| Date: | 2008–11 |
| URL: | http://d.repec.org/n?u=RePEc:ukc:ukcedp:0812&r=ene |
| By: | Yazid Dissou (Department of Economics, University of Ottawa); Reza Ghazal (Department of Economics, University of Ottawa) |
| Abstract: | This study provides estimates of the price and Morishima substitution elasticities between energy and non-energy inputs in two Canadian energy-intensive manufacturing industries: Primary Metal and Cement. The elasticities are estimated using annual industry-level KLEM data (1961- 2003) and relying on two flexible functional forms: the Translog and the Symmetric Generalized McFadden (SGM) cost functions. In addition to the point estimates, the confidence intervals of the elasticities are computed using single- and double-bootstrap resampling techniques. For both industries, the estimation results suggest that capital, labour, material and energy are pairwise substitutes and that energy is the most substitutable input. However, the low magnitudes of the estimated elasticities do not seem to offer great flexibility to these industries to adapt to high increases in energy prices. |
| Keywords: | Energy; Elasticity of substitution; Translog cost function; Symmetric Generalized McFadden (SGM) Cost Function; Single Bootstrap; Double Bootstrap. |
| JEL: | C30 Q4 |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ott:wpaper:0809e&r=ene |
| By: | Carlos P. Barros; Walter Briec; Nicolas Peypoch |
| Abstract: | This paper analyses productivity growth and the nature of techni- cal change in a sample of Portuguese hydroelectric generating plants over the period 2001 to 2004. In a ¯rst step, we employ the Luen- berger productivity indicator to estimate and decompose productivity change. The results paint a picture of mixed productivity performance in the Portuguese energy sector. In a second step, we analyse the na- ture of this technical change by using the recent concept of parallel neutrality (Briec et al., 2006). We observe a global shift in the best practice frontier as well as evidence of input bias in technical change. |
| Keywords: | hydroelectric energy; Portugal; Luenberger productivity indicator; parallel neutrality. |
| JEL: | G21 D24 |
| Date: | 2008–06 |
| URL: | http://d.repec.org/n?u=RePEc:ise:isegwp:wp362008&r=ene |
| By: | Fernadez-Tirado, Francisca; Parra-Lopez, Carlos |
| Abstract: | A variety of opinions either in favour or against development of biofuels has risen in the last years related to the environmental, economic and social impacts that its diffusion could entail compared to petroleum. Although the EU, in general, and Spain, in particular, are strongly supporting the development of biofuels they highlight that energy planning must be based on a sound analysis of the impacts of the diverse alternatives. This poster is a preliminary approach to this analysis. The main aim is to prioritize a set of environmental, economic and social objectives to identify the most relevant issues that would allow evaluating the impacts of the biofuel production and consumption in Spain. Analytic Network Process (ANP) and Analytic Hierarchy Process (AHP) are the multicriteria decision-making methodologies implemented to deal with the problem based on experts€٠knowledge. The superiority of ANP versus AHP is discussed and the former is recommended. Results indicate that the most important objectives for a sustainable development of biofuels in Spain are conservation of non-renewable resources, within the environmental issues, the ease to be technically implemented in production, storage, distribution, and consumption, within the economic issues, and the direct employment in the agro-energy system, within the social issues. |
| Keywords: | Biofuel, sustainability, ANP, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44117&r=ene |
| By: | Jan van Heerden (Department of Economics, University of Pretoria); James Blignaut (Department of Economics and Econometrics, University of Johannesburg); Andre Jordaan (Department of Economics, University of Pretoria) |
| Abstract: | The paper uses a static Computable General Equilibrium (CGE) model of South Africa and simulates various shocks to the price of electricity. We attempt di¤erent closures to the model and compare their respective e¤ects on the Consumer Price Index. In a CGE model, this is measuring the real appreciation of the exchange rate, or international trade competitiveness. In general, we conclude that electricity prices per se does not signi?cantly in?uence the real exchange rate, regardless of which closure is used. |
| JEL: | D5 E3 H2 |
| Date: | 2008–11 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:200836&r=ene |
| By: | Bayramoglu, Basak |
| Abstract: | The object of this paper is to analyze, in a general equilibrium setting with four markets, the e¢ ciency of a biofuel subsidy policy. The analysis takes into account environmental externalities associated both with the production and the consumption of biofuels, as well as associated with the production of agricultural raw material. Our pre- liminary numerical results, applied to the biodiesel subsidy policy in France, …rst show that this policy increases the utility of the repre- sentative consumer compared to the laissez-faire solution. The same policy action leads, however, to an increased level of agricultural and GHG emissions, in comparison with the laissez-faire solution. |
| Keywords: | biofuels, subsidy, environment, Environmental Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44399&r=ene |
| By: | Guinde, L.; Jacquet, F.; Millet, G. |
| Abstract: | The paper provides an analysis of the impacts of the biofuel policy on the French arable crop sub-sector. The model used is a biofuel supply model composed of an agricultural module and an industrial biofuel processing module. The agricultural supply model is an aggregation of 1094 farm models, based on data from the French Farm Accountancy Data Network (FADN). Different biofuel chains are included in the model: ethanol from wheat and sugar beet, biodiesel (Vegetable Oil Methyl Ester) from rapeseed and sunflower. Scenarios are built upon the recent policy of an increased demand of biofuels for the next years, under the assumption of fulfilling the targets with domestic production only. Results show that the incorporation target of 7% of biofuels in transport fuels would have small impacts on the wheat and sugar beet cultivated areas but would lead to a considerable increase in the rapeseed area. In the main producing regions, the rapeseed area would reach approximatively a third of the total farmed area. This would not be without consequences on the environment, due to the increase in pesticide use that this change in cropping patterns would most certainly induce. It would not be possible to reach a 10% incorporation target without imports. Furthermore, we analyse the impacts of reaching these production levels on the rapeseed opportunity costs, and show that reaching high level of incorporation (above 7%) will need a very high increase in rapeseed prices paid to farmers. We calculate the impacts of this opportunity cost increase on the competitiveness of biofuels with respect to fossil oil, for different levels of oil prices. We test the sensitivity of the results against the wheat price, and show that this latter will have a significant impact on the biodiesel competitiveness. |
| Keywords: | biofuel, agriculture, France, Agricultural and Food Policy, Crop Production/Industries, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:43540&r=ene |
| By: | Banse, Martin; Grethe, Harald |
| Abstract: | In its Progress Report on Biofuels the European Commission proposes a more restrictive biofuel directive which sets a mandatory minimum share of biofuels in total fuel consumption in the transport sector of 10% per Member State by 2020. This is likely to have a strong impact on demand for biofuel inputs such as plant oils, cereals and sugar beet. To analyze the effects of this proposal on land use and agricultural markets, an extended version of the partial equilibrium model ESIM of the European agricultural sector is developed and applied which covers the production of and demand for biofuels. Two policy scenarios are simulated for the projection horizon until 2020: a baseline under which the share of biofuels in total transport fuels increases to 6.9% by 2020, and a scenario with a more demanding biofuel directive resulting in a 10% share. Results show that a substantial part of the policy-induced demand for biofuels is covered by imports of biofuels and biofuel inputs. Especially after the implementation of a potential Doha agreement, EU production of bioethanol strongly decreases, while almost all bioethanol demand is covered by imports. |
| Keywords: | Biofuels, EU Biofuels Directive, agricultural markets, partial equilibrium modeling, Land Economics/Use, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6331&r=ene |
| By: | Khachatryan, N.; Zeller, H.; Haring, A.M.; Khachatryan, A. |
| Abstract: | Renewable resources gain in importance in our modern society. The line of reasoning is based on their positive effects on agriculture, the environment and the economy. To support renewable energy from biomass the EU promotes the cultivation of energy crops. A spatial equilibrium model is applied based on the concept of maximizing net welfare, to provide information whether energy crop production competes with food production for land area. The Model of Interregional Trade of Energy Crops (ITEC) refers to Eastern Germany and adjacent areas of Poland. First results show that the regions have enough feedstocks to meet the required demand for food and biofuel production. In many cases both food crops and biofuels are either traded on interregional basis or exported to "Rest of Europe" indicating that there is no competition between food and energy crops. Only green maize for biogas production strongly competes in areas where the crop is required as feed for cattle. |
| Keywords: | Energy crops, spatial equilibrium analysis, interregional trade, International Relations/Trade, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaae08:44121&r=ene |
| By: | Binfield, Julian; Westhoff, Patrick; Le Cadre, Elodie |
| Abstract: | The impact of increased consumption of biofuels on agricultural markets has already been substantial, and will increase further as countries around the world seek to expand the proportion of their energy that they get from renewable sources. Models of the agricultural sector must therefore include some consideration of the demand for agricultural products for biofuels and the byproducts that are produced as part of the production process that are returned to the agricultural sector. In this paper the method of introducing biofuels into the FAPRI GOLD (grains, oilseeds, livestock and dairy) model is discussed. A scenario is run whereby the EU is assumed to introduce a binding 10% target by 2020 and the results are discussed in order to illustrate the workings of the model. The modelling effort is ongoing and planned work is discussed. The aim of the paper is to highlight major issues in building a model of this type. |
| Keywords: | Biofuels, partial equilibrium model, agricultural sector, EU policy, Agricultural and Food Policy, Crop Production/Industries, Research Methods/ Statistical Methods, Resource /Energy Economics and Policy, |
| Date: | 2008 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa107:6680&r=ene |