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on Energy Economics |
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Issue of 2012‒01‒10
fifteen papers chosen by Roger Fouquet Basque Climate Change Centre, Bilbao, Spain |
| By: | Joanne Evans (Surrey Energy Economics Centre (SEEC), Department of Economics, University of Surrey); Massimo Filippini (Centre for Energy Policy and Economics (cepe), ETH Zurich and Department of Economics, University of Lugano); Lester C Hunt (Surrey Energy Economics Centre (SEEC) and Research Group on Lifestyles Values and Environment (RESOLVE), University of Surrey) |
| Abstract: | Using results for 29 OECD countries from the estimation of an extended version of the model advocated by Filippini and Hunt (2011a), actual energy consumption and CO2 emissions are compared to notional energy consumption and CO2 emissions if the countries were energy efficient. This shows the contribution that improvements in energy efficiency can make towards the reduction in CO2 emissions. It is found that in many countries efficiency improvements alone are not likely to be sufficient to bring about reductions in CO2 emissions required to meet ambitious obligations. However, this is not the case across all countries included in the investigation. Moreover, it is shown that some of the world’s largest OECD emitters can make a significant contribution to CO2 reductions from becoming energy efficient. Therefore the negotiations of the new legally binding treaty agreed under the Durban Platform should promote emission reduction targets that incentivise national energy efficiency. |
| Keywords: | emissions, energy efficiency, Durban Platform. |
| JEL: | Q41 Q48 Q50 Q54 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:sur:seedps:135&r=ene |
| By: | Lindenberger, Dietmar (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Kuemmel, Rainer (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | The mathematical conditions for the existence of macroeconomic production functions that are state functions of the economic system are pointed out. The output elasticities and the elasticities of substitution of energy-dependent Cobb-Douglas, CES and LinEx production functions are calculated. The output elasticities, which measure the productive powers of production factors and whose numerical values have been obtained for Germany, Japan, and the USA, are for energy much larger and for labor much smaller than the cost shares of these factors. Energy and its conversion into physical work accounts for most of the growth that mainstream economics attributes to “technological progress” and related concepts. It decisively determines the economic state of nations. Consequences for automation and globalization and perspectives on growth are discussed. |
| Keywords: | energy; economic growth; macroeconomic production functions; output elasticities |
| JEL: | E23 O41 Q43 |
| Date: | 2011–12–28 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2011_011&r=ene |
| By: | Paulus, Moritz (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Grave, Katharina (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Lindenberger, Dietmar (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | In this paper, we develop a methodology for deriving a consistent measure for supply adequacy in the power generation sector. We especially consider the secured generation capacity of intermittent renewable energy sources such as wind. <p> Availability of conventional power plants is estimated through stochastic convolution of unscheduled non-usabilities. We employ our methodology to measure supply security in Germany until 2030. A detailed market analysis of power plants that are currently being built or planned provides support to our analysis for the short term. <p> For the long term, we rely on a large-scale dispatch and investment model of the European power sector to account for the embedding of the German electricity sector in the European market. We analyze two scenarios: one with prolongation of nuclear power plants and one with a nuclear phase-out. <p> Our results show that, even though intermittent renewables only provide very limited secured generation capacity, security of electricity supply in Germany can be assured until 2015. In the long term, the need for backup capacity for renewable energy sources increases as well as the need for electricity imports. |
| Keywords: | Supply adequacy; integration of renewable energy sources; power generation; German power sector; secured generation capacity |
| JEL: | C61 L94 Q21 Q40 |
| Date: | 2011–12–28 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2011_010&r=ene |
| By: | Fürsch, Michaela (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Lindenberger, Dietmar (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Malischek, Raimund (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Nagl, Stephan (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Panke, Timo (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Trüby, Johannes (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | In the aftermath of the nuclear catastrophe in Fukushima, German nuclear policy has been reconsidered. This paper demonstrates the economic effects of an accelerated nuclear phase-out on the German electricity generation sector. <p> A detailed optimization model for European electricity markets is used to analyze two scenarios with different lifetimes for nuclear plants (phase-out vs. prolongation). Based on political targets, both scenarios assume significant electricity demand reductions and a high share of generation from renewable energy sources in Germany. Our principal findings are: First, nuclear capacities are mainly replaced by longer lifetimes of existing coal-fired plants and the construction of new gas-fired plants. Second, fossil fuel-based generation and power imports increase, while power exports are reduced in response to the lower nuclear generation. Third, despite the increased fossil generation, challenging climate protection goals can still be achieved within the framework of the considered scenarios. Finally, system costs and electricity prices are clearly higher. <p> We conclude that the generation sector can generally cope with an accelerated nuclear phase-out under the given assumptions. Yet, we emphasize that such a policy requires a substantial and costly transformation of the supply and the demand side. |
| Keywords: | Nuclear policy; climate protection; renewable energy; electricity market modeling |
| JEL: | C61 L94 Q48 Q58 |
| Date: | 2011–12–28 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2011_012&r=ene |
| By: | Fridolfsson, Sven-Olof (Research Institute of Industrial Economics (IFN)); Tangerås, Thomas (Research Institute of Industrial Economics (IFN)) |
| Abstract: | We propose nuclear capacity auctions as a means to improve the incentives for investing in nuclear power. A properly designed auction would (i) allocate the license to the most efficient bidder; (ii) sell the license if and only if new nuclear power was socially optimal. In particular, capacity auctions open the market for large-scale entry by outside firms. Requiring licensees to sell a share of capacity as virtual power plant contracts increases auction efficiency by softening incumbent producers’ incentive to bid for market power. Our motivating example is Sweden’s recent decision to allow new nuclear power to replace old reactors. |
| Keywords: | Capacity auctions; investments; market power; nuclear power; virtual power plants |
| JEL: | D44 L12 Q48 |
| Date: | 2011–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0892&r=ene |
| By: | Jaime Casassus; Freddy Higuera |
| Abstract: | This paper shows that oil price changes, measured as short-term futures returns, are a strong predictor of excess stock returns at short horizons. Ours is a leading variable for the business cycle and exhibits low persistence which avoids the ctitious long-horizon predictability associated to other predictors used in the literature. We compare our variable with the most popular predictors in a sample period that includes the recent nancial crisis. Our results suggest that oil price changes are the only variable with forecasting power for stock returns. This signi cant predictive ability is robust against the inclusion of other variables and out-of-sample tests. We also study the cross-section of expected stock returns in a conditional CAPM framework based on oil price shocks. Our model displays high statistical signi cance and a better t than all the conditional and unconditional models considered including the Fama French three-factor model. From a practical perspective, ours is a high-frequency, observable variable that has the advantage of being readily available to market-timing investors. |
| Keywords: | Return predictability, business cycle, crude oil, futures prices, asset pricing, conditional CAPM |
| JEL: | G17 E44 Q43 E32 G12 G14 |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ioe:doctra:406&r=ene |
| By: | Briones, Roehlano M. |
| Abstract: | The Philippines has made a major push toward development of biofuel, enacting biofuels mandates and subsidies by the Biofuels Law. To maintain food security, biofuels policies currently restrict feedstock production to marginal lands. This raises its own issues related to commercial viability, small farmer livelihood, and environmental sustainability. This study conducts a field investigation of these issues, covering small holder feedstock producers producing sugarcane, cassava, and coconut. The study finds the following: i) Biofuels development in marginal areas are potentially profitable ventures for investors, assuming stable physical and economic environment, as well as a predictable policy environment. ii) Contract growing arrangements have been largely advantageous to farmers. iii) Farmers who have entered into contract growing arrangements have a reasonable expectation of improved livelihoods. iv) Biofuels development in marginal lands are not expected to cause significant input intensification, although expansion of cultivated area for emerging feedstock such as cassava should be monitored. Rather than small holder exploitation, or environmental degradation, this study points to other major development concerns, namely maintaining policy coherence, containing costs imposed on the fuel-buying public, and rethinking the biofuel mandate, in favor of other instruments for promoting indigenous sources of renewable energy. |
| Keywords: | Philippines, environmental degradation, illegal gambling, capital gains, capital gain tax, biofuels development, marginal lands, rural livelihoods |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:phd:dpaper:dp_2011-16&r=ene |
| By: | Wang-Helmreich, Hanna (Wuppertal Institute for Climate, Environment and Energy); Lochner, Stefan (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | Greenhouse gas emission reductions are at the centre of national and international efforts to mitigate climate change. In road transportation, many politically incentivised measures focus on increasing the energy efficiency of established technologies, or promoting electric or hybrid vehicles. The abatement potential of the former approach is limited, electric mobility technologies are not yet market-ready. <p>In a case study for Germany, this paper focuses on natural gas powered vehicles as a bridging technology towards low-emission road transportation. Scenario analyses with a low level of aggregation show that natural gas-based road transportation in Germany can accumulate up to 464 million tonnes of CO2-equivalent emission reductions until 2030 depending on the speed of the diffusion process. If similar policies were adopted EU-wide, the emission reduction potential could reach a maximum of about 2.5 billion tonnes of CO2-equivalent. <p>A model-based analysis shows that the comparative cost advantage of natural gas relative to petrol and diesel per energy unit is not significantly reduced by the increased gas demand from natural gas vehicles. Capital costs for the transformation of the transport system to natural gas are therefore accompanied by lower fuel costs. Specific emission abatement costs of natural gas based mobility decline over time. After between 15 and 20 years, they are projected to be relatively low or even negative when a maximum rate of diffusion of natural gas vehicles is assumed. |
| Keywords: | Emission reduction potential; Road transportation; Natural gas vehicles; Abatement costs; Low emission mobility; Alternative fuels |
| JEL: | L92 O33 Q41 Q54 |
| Date: | 2012–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2011_014&r=ene |
| By: | Francisco Gallego; Juan-Pablo Montero; Christian Salas |
| Abstract: | In an effort to reduce air pollution and congestion, Latin American cities have experimented with different policies to persuade drivers to give up their cars in favor of public transport. Two notable examples are the driving restriction program introduced in Mexico-City in November of 1989 –Hoy-No-Circula (HNC)– and the public transport reform carried out in Santiago in February of 2007 –Transantiago (TS). We develop a simple model of car use and ownership, and show that policies that may appear effective in the short run can be highly detrimental in the long run, i.e., after households have adjusted their stock of vehicles. Based on hourly concentration records of carbon monoxide, which comes primarily from vehicles exhaust, we find that household’s responses to both HNC and TS have been remarkably similar and consistent with the above: an expected short-run response followed by a rapid (before 11 months) increase in the stock of vehicles. |
| Date: | 2011 |
| URL: | http://d.repec.org/n?u=RePEc:ioe:doctra:407&r=ene |
| By: | Krautzberger, Lisann (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Wetzel, Heike (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | In the last decades transport activities persistently increased in the EU27 and were strongly coupled to growth in GDP. Like most production processes, they are inevitably linked with the generation of environmentally hazardous by-products, such as CO2 emissions. This leads to the question of how to promote a sustainable transport sector that meets both environmental protection targets and economic requirements. In this context, the objective of this paper is to compare the CO2-sensitve productivity development of the European commercial transport industry for the period between 1995 and 2006. We calculate a Malmquist-Luenberger productivity index to investigate the effects of country-specific regulations on productivity and to identify innovative countries. Our results show a high variation in the CO2-sensitive productivity development and a slight productivity decrease on average. Efficiency losses indicate that the majority of the countries were not able to follow the technological improvements induced by some innovative countries. |
| Keywords: | European transport industry; Carbon dioxide emissions; Productivity growth; Malmquist-Luenberger index |
| JEL: | L92 Q47 Q53 Q56 |
| Date: | 2012–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2011_013&r=ene |
| By: | Nuno Boavida (IET, Universidade Nova de Lisboa, Faculdade de Ciências e Tecnologia) |
| Abstract: | This work examines a recent study that used various forecasting methods and in particular the Delphi method, to understand how the indicators were selected during the development of the prospective study. It can be concluded that the indicators in the study were selected through discussion on existing knowledge (formal and informal) and the broad consensus of the respective community, which established and confirmed the choice of indicators as the most relevant to prospectively examine the matter concerned. The technical support provided to choose certain forecasting methods as well as to choose the methods that could not be used throughout the development of the work, contributed to the strength of the list of indicators. |
| Keywords: | Indicators; forecasting; Delphi method; CO2 emissions; road freight transport; carbon footprint |
| JEL: | C18 C52 C53 |
| Date: | 2011–06 |
| URL: | http://d.repec.org/n?u=RePEc:ieu:wpaper:37&r=ene |
| By: | Elettra Agliardi (Department of Economics, University of Bologna and Rimini Center for Economic Analysis); Luigi Sereno (Department of Economics, University of Bologna) |
| Abstract: | The effects of four environmental policy options for the reduction of pollution emissions, i.e. taxes, emission standards, auctioned permits and freely allocated permits, are analyzed. The setup is a real option model where the amount of emissions is determined by solving the firm's profit maximization problem under each policy instrument. The regulator solves an optimal stopping problem in order to find the critical threshold for policy adoptions taking into account revenues from taxes and auctioned permits and government spending. In this framework, we find the ranking of the alternative policy options in terms of their adoption lag and social welfare. We show that when the output demand is elastic emission standards are preferred to freely allocated permits. Taxes and auctioned permits are always equivalent in terms of their adoption lag and social welfare and also equivalent to emission standards when the regulator redistributes revenues. |
| Keywords: | Environmental policies; Taxes; Emission standards; Permits; Public abatement spending; Optimal implementation time; Real options |
| JEL: | Q28 Q L51 H23 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:rim:rimwps:53_11&r=ene |
| By: | Hasan, Dr. Syed Akif; Subhani, Dr. Muhammad Imtiaz; Osman, Ms. Amber |
| Abstract: | No product on this planet has a nix impact on the business and environment one is surrounded by and therefore, ‘green products/brands and environmental-friendly products/brands’ is the word used to express those products/brands that work to shield and care for atmosphere/environment by preserving the free energy and/or resources, in order to effectively manage to reduce the wastes from the environment as much as possible. By the topic, it is apparent that the study is all about green marketing and especially to assess the consumer’s perception about the products and brands, which are environmental-friendly i.e. whether green marketing really impresses an individual to buy the products/brands than a product/brand, which doesn’t promote environmental-friendly positioning. This study focuses the Asian market, which is challenged by economic development and opportunity due to gain in energy prices, terrorism, environmental and climatic changes and consequences. A sufficient sample of 2000 users of green products were selected via judgmental sampling and inquired via online structured questionnaire. It was revealed by Multiple Regression test that the associate variables of Consumer’s Environmental Consciousness, which are Social Influence, Environmental Concern, and Perceived Seriousness of Environmental Problems, indeed affect an individual’s Brand Perception/Preference. While, Environmental Attitude, which is the associate variable of Environmental Attitude and Brand’s Environmental Friendly Perception does not affect Brand Preference. However, when the data was split according to gender, Environmental Concern and Brand’s Environmentally Friendly Perception affect Male, while Social Influence and Environmental Concern affect Female in their choice of green-marketed product/brand. |
| Keywords: | Green marketing; Environmental friendliness; Environmental consciousness;Environmental problems; Brand preference |
| JEL: | M0 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:35688&r=ene |
| By: | Laurent, Eloi (OFCE) |
| Abstract: | Le visage offert par l’Union européenne (UE) à la conférence de Durban sur le climat n’était, a priori, guère rassurant. L’improbable attelage formé par la commissaire Connie Hedegaard, en partie responsable du déraillement des négociations de Copenhague en 2009 en sa qualité de ministre danoise de l’Environnement, et la Présidence polonaise, qui milite au sein même de l’UE pour modérer les ambitions climatiques de la région, ne pouvait qu’inciter à la circonspection. Fort heureusement, la délégation européenne à Durban peut compter sur l’apport des délégations nationales et du Parlement européen et s’appuyer sur l’acquis de deux décennies d’engagement du Vieux continent en faveur du climat... |
| Date: | 2011–12–08 |
| URL: | http://d.repec.org/n?u=RePEc:ner:sciepo:info:hdl:2441/eu4vqp9ompqllr09iak4hcm15&r=ene |
| By: | Joseph E. Aldy; William A. Pizer |
| Abstract: | In order to clarify ongoing debates over the competitiveness impacts of climate change regulation, we develop a precise definition that can be estimated with available domestic production, trade, and energy price data. We use this definition and a 20+ year panel of 400+ U.S. manufacturing industries to estimate and predict the effects a U.S.-only $15 per ton CO2 price. We find competitiveness effects on the order of a 1.0 to 1.3 percent decline in production among energy-intensive manufacturing industries, representing about one-third of the policy’s impacts on these firms’ output. |
| JEL: | F18 Q52 Q54 |
| Date: | 2011–12 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:17705&r=ene |