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on Energy Economics |
| By: | Shahrouz Abolhosseini (College of Engineering, Seoul National University); Almas Heshmati (Department of Economics, Sogang University); Jorn Altmann (College of Engineering, Seoul National University) |
| Abstract: | The increased concerns about climate change have made renewable energy sources an important topic of research. Several scholars have applied different methodologies to examine the relationships between energy consumption and economic growth of individual and groups of countries and to analyze the environmental effects of energy policies. Previous studies have analyzed carbon emission savings, using renewable energy usage as an individual source or in combination with traditional sources of energy (e.g., hybrid plants) in connection with life-cycle analysis methods. It is shown that after a certain period, economic growth leads to the promotion of environmental quality. However, econometric modeling critiques have opposed the results of these studies. One reason is that the effectiveness of governance-related parameters has previously been neglected. In this research, we analyze the impact of renewable energy development on carbon emission reduction. We estimate a model to evaluate the effectiveness of renewable energy development, technological innovation, and market regulations in carbon emission reduction. The empirical results are based on a panel data estimation using the EU-15 countries data observed from 1995 to 2010. The elasticities of CO2 emissions are estimated, in order to evaluate the effectiveness of each parameter. The finding show that the effects of a negative climate change could be mitigated by governance-related parameters instead of economic development.. |
| Keywords: | Renewable Energy, Technological Innovation, Environmental Tax, Carbon Emission, Economic Growth. |
| JEL: | D62 H23 N50 O13 O14 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:snv:dp2009:2014109&r=ene |
| By: | Mireille Bossy (INRIA Sophia Antipolis / INRIA Lorraine / IECN - TOSCA - INRIA - CNRS : UMR7502 - Université Henri Poincaré - Nancy I - Université Nancy II - Institut National Polytechnique de Lorraine (INPL)); Odile Pourtallier (INRIA Sophia Antipolis - COPRIN - INRIA - École des Ponts ParisTech (ENPC)); Nadia Maïzi (CMA - Centre de Mathématiques Appliquées - MINES ParisTech - École nationale supérieure des mines de Paris) |
| Abstract: | In this paper, we analyze Nash equilibria between electricity producers selling their production on an electricity market and buying \co2 emission allowances on an auction carbon market. The producers' strategies integrate the coupling of the two markets via the cost functions of the electricity production. We set out a clear Nash equilibrium on the power market that can be used to compute equilibrium prices on both markets as well as the related electricity produced and \co2 emissions released. |
| Date: | 2014–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-00954377&r=ene |
| By: | Janda, Karel; Krska, Stepan; Prusa , Jan |
| Abstract: | The article is focused on the total historical and future costs of supporting photovoltaic electricity generation in the Czech Republic. The model estimation of these costs is accompanied by methodologically unified comparison with cost of the support of other renewable energy resources. We find that as long as the goals of Czech National Action Plan for Renewable Energy will be implemented, the costs on photovoltaics support will account for more than one half of all costs on renewable energy, combined production of electricity and heat and other secondary resources. The article also provides brief overview of the photovoltaic market in the Czech Republic with its past, present and possible future developments. |
| Keywords: | photovoltaics; renewable energy sources; energy policy; feed-in tariffs |
| JEL: | Q28 Q42 Q47 |
| Date: | 2014–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:54108&r=ene |
| By: | Florian Kern (SPRU, University of Sussex, UK); Adrian Smith (SPRU, University of Sussex, UK); Chris Shaw (SPRU, University of Sussex, UK Author name: Rob Raven Author Email: R.P.J.M.Raven@tue.nl Author workplace; STS, Technische Universiteit Eindhoven, Netherlands Author name: Bram Verhees Author Email: B.Verhees@.tue.nl Author workplace: STS, Technische Universiteit Eindhoven, Netherlands) |
| Keywords: | UK renewable energy policy; offshore wind; technology politics |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:sru:ssewps:2014-02&r=ene |
| By: | Unteutsch, Michaela (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | This paper numerically analyzes redistribution effects resulting from cooperation among European countries in achieving the 2020 targets for electricity generation from renewable energy sources (RES-E). The quantification of redistribution effects builds on the theoretical analysis by Unteutsch (2014), who shows that cooperation in RES-E support increases overall welfare but is not beneficial for all groups. In this paper, we use a dynamic investment and dispatch optimization model of the European electricity system to investigate which groups potentially benefit from cooperation and which groups would be worse off compared to a situation in which national RES-E targets are reached solely by domestic RES-E production. In the analysis, cooperation in RES-E support is implemented as a European-wide green certificate trading scheme. Main findings of the analysis include that in the European electricity system, effects of the change in the certificate price in most countries would overcompensate for the effects of the change in the wholesale electricity price. Thus, in most countries with comparatively high (low) generation costs for renewable energies, consumer rents increase (decrease) due to cooperation and producers yield lower (higher) profits. In addition, it is found that the magnitude of redistribution effects between the individual groups is quite large: In some countries, the change in consumer rents or producer profits resulting from cooperation is nearly twice as high as the overall welfare effect of cooperation in the whole European electricity system. Moreover, we find that the sign, but not always the magnitude, of redistribution effects is quite robust to different developments of interconnector extensions, the CO2 price and RES-E investment costs. |
| Keywords: | Cooperation Mechanisms; Tradable Green Certi ficates; Welfare; Consumer Rent; Producer Profi t; Power System Optimization |
| JEL: | C61 F19 Q28 Q40 Q48 |
| Date: | 2014–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2014_002&r=ene |
| By: | Unteutsch, Michaela (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | It has been shown that international cooperation in achieving renewable energy targets, e.g., via a common tradable green certi ficate market, increases overall welfare. However, cooperation in the support of electricity from renewable energy sources also leads to regional price effects, from which some groups benefit while others lose. On a regional level, the introduction of cross-border cooperation in RES-E support generally has an opposite effect on support expenditures and wholesale electricity prices, as long as grid congestion between the diff erent regions exists. In this paper, a theoretical model is used to analyze under which conditions different groups benefi t or suff er from the introduction of cooperation. Findings of the analysis include that eff ects on consumers and total producers per country can only be clearly determined if no grid congestions between the countries exist. If bottlenecks in the transmission system exist, the relationship between the slopes of the renewable and the non-renewable marginal generation cost curves for electricity generation as well as the level of the RES-E target essentially determine whether these groups benefi t or lose from the introduction of green certi ficate trading. In contrast, system-wide welfare always increases once cooperation in RES-E support is introduced. Similarly, welfare on the country level always increases (compared to a situation without RES-E cooperation) if the countries are perfectly or not at all physically interconnected. In the case of congested interconnectors, each country always at least potentially benefi ts from the introduction of certi ficate trade, taking into account possible distributions of congestion rents between the countries. |
| Keywords: | Cooperation Mechanisms; Tradable Green Certificates; Welfare; Consumer Rent; Producer Profit |
| JEL: | F19 Q28 Q40 Q48 |
| Date: | 2014–01–14 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2014_001&r=ene |
| By: | Ian Lange (Division of Economics and Business, Colorado School of Mines); Mirko Moro (Division of Economics, University of Stirling, Scotland, UK); Mohammad Mahbubur Rahman (Division of Economics, University of Stirling, Scotland, UK) |
| Abstract: | Much attention in recent years has turned to the potential of behavioural insights to improve the performance of government policy. One behavioural concept of interest is the effect of a cash transfer label on how the transfer is spent. The Winter Fuel Payment (WFP) is a labelled cash transfer to offset the costs of keeping older households warm in the winter. Previous research has shown that households spend a higher proportion of the WFP on energy expenditures due to its label (Beatty et al., 2011). If households interpret the WFP as money for their energy bills, it may reduce their willingness to undertake investments which help achieving the same goal, such as the adoption of renewable energy technologies. In this paper we show that the WFP has distortionary effects on the renewable technology market. Using the sharp eligibility criteria of the WFP in a Regression Discontinuity Design, this analysis finds a reduction in the propensity to install renewable energy technologies of around 2.7 percentage points due to the WFP. This is a considerable number. It implies that 62% of households (whose oldest member turns 60) would have invested in renewable energy but refrain to do so after receiving the WFP. This analysis suggests that the labelling effect spreads to products related to the labelled good. In this case, households use too much energy from sources which generate pollution and too little from relatively cleaner technologies. |
| Keywords: | Winter Fuel Payment, Regression Discontinuity, Renewable energy |
| JEL: | C31 Q42 Q48 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:mns:wpaper:wp201402&r=ene |
| By: | Yuanjing Li |
| Abstract: | The pro-competitive effects of forward contracts in electricity market can- not be regarded alone without examining the market structure. In this paper, we show that under retail competition, spot market demand uncertainty and risk aversion, partially or fully integrated electricity generators and retailers have less incentives to be involved in trading electricity under forward con- tracts. Therefore, the effect of market power mitigation of forward contracts is countered by this vertical relationship between retailers and generators since it provides a natural hedging device as a substitute of forward contracts to the retailers. Both analytic framework and numerical simulation suggest that the optimal quantity of forward sales decreases and spot price increases with the degree of vertical control of retailers over generators' assets. We thus conclude that the retailers' ownership over generators' proffts could give rise to generators exercising market power in electricity spot market. |
| JEL: | L13 L42 L94 |
| Date: | 2014–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:ipg:wpaper:2014-117&r=ene |
| By: | Ladislav Kristoufek |
| Abstract: | We propose a comprehensive treatment of the leverage effect, i.e. the relationship between returns and volatility of a specific asset, focusing on energy commodities futures, namely Brent and WTI crude oils, natural gas and heating oil. After estimating the volatility process without assuming any specific form of its behavior, we find the volatility to be long-term dependent with the Hurst exponent on a verge of stationarity and non-stationarity. Bypassing this using by using the detrended cross-correlation and the detrending moving-average cross-correlation coefficients, we find the standard leverage effect for both crude oil. For heating oil, the effect is not statistically significant, and for natural gas, we find the inverse leverage effect. Finally, we also show that none of the effects between returns and volatility is detected as the long-term cross-correlated one. These findings can be further utilized to enhance forecasting models and mainly in the risk management and portfolio diversification. |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1403.0064&r=ene |
| By: | Marina Fischer-Kowalski; Daniel Hausknost |
| Abstract: | WP 201 takes a historical perspective in analysing past systemic social-ecological transition processes. The research paper (MS 27) emerging from task 201.2 explores two major energy transitions of the past: the transition to the use of fossil fuels (e.g. starting with coal in the UK in the 17th century, and continuing in the rest of the world with coal and oil since). How was this transition linked to major institutional transformations, frequently paved by revolutions? We statistically demonstrate how similar processes occurred in many countries, and accellerated over time. In contrast to more common approaches, we do not focus on the introduction of particular technologies, but on the gradual substitution of biomass as the key source of energy by fossil fuels, and also on the increase in the amount of economically available energy. Beyond the common indicator TPES (total primary energy supply) we use and expand our historical database that countains the indicator DEC (domestic energy consumption). DEC encompasses, beyond TPES, also the energy converted by human and animal nutritional intake. We analyse the role of revolutions for the respective energy transition statistically and are able to identify statistical breaks in population growth, energy consumption and economic growth linked to the occurrence of revolutions. We compare trajectories of European and Non-European countries, and we compare countries in which the transition to the use of fossil fuels was marked by revolutionary processes with countries where this was not the case. Particular attention is paid to the phase of the transition in which revolutions have occurred, and the impact this shock had on the further course of the energy transition and on economic growth. The second marked transition analyzed occurred in the mature industrial economies in the early 1970s, in association with the first and second oil price shocks. In practically all mature industrial countries, there was triggered a termination of the steep incline of metabolic rates in favour of a fairly stable per capita level of energy and materials consumption, while economic growth continued. We investigate the policy responses in key policy areas coping with these "shocks" and achieving a reduction of biophysical growth while maintaining growth in the economy and employment. We employ a number of different methods for this analysis: we investigate long time series data statistically to explore at what time and in what sequence certain trends changed. On the other hand, we explore policy analysis literature for a number of countries qualitatively. Finally, we synthesize what can be learned from such macro societal transitions: what role do external shocks, structural change and energy policies play? Which lessons are to be learnt from past transitions in order to be in a better position to manage the transition ahead of us? |
| Keywords: | Academic research, Biophysical constraints, Demographic change, Ecological innovation, Economic growth path, Economic strategy, Energy transitions, Globalisation, Holistic and interdisciplinary approach, Industrial innovation, Industrial policy, Innovation policy, Institutional reforms, Labour markets, New technologies, Policy options, Post-industrialisation, Socio-ecological transition |
| JEL: | Q01 Q02 Q28 Q32 Q34 Q38 Q43 Q48 Q5 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:feu:wfewop:y:2014:m:3:d:0:i:55&r=ene |
| By: | Bastos, Paulo; Castro, Lucio; Cristia, Julian; Scartascini, Carlos |
| Abstract: | This paper exploits unique features of a recently introduced tariff schedule for natural gas in Buenos Aires to estimate the short-run impact of price shocks on residential energy utilization. The schedule induces a nonlinear and non-monotonic relationship between households'accumulated consumption and unit prices, thus generating exogenous price variation, which is exploited in a regression-discontinuity design. The results reveal that a price increase causes a prompt and significant decline in gas consumption. They also indicate that consumers respond more to recent past bills than to expected prices, which argues against the assumption that consumers have perfect awareness of complex price schedules. |
| Keywords: | Consumption,Climate Change Economics,Economic Theory&Research,Energy Production and Transportation,Markets and Market Access |
| Date: | 2014–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6785&r=ene |
| By: | Olga Podkorytova; Yulia Raskina |
| Abstract: | This paper evaluates convergence of energy intensity for the former USSR countries during 1995-2010. We divide these countries into three clubs and show convergence in income and in energy intensity for each club. We also demonstrate that rate of convergence is higher in countries with a low level of development. |
| Keywords: | Сlub convergence, energy intensity, former USSR |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2014/03&r=ene |
| By: | Dubois, Ute (ISG Business School); Meier, Helena (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | The present paper discusses the concept of fuel poverty taking into account the arbitrages made by households when they are facing economic constraints. Fuel poverty is still lacking a common definition throughout Europe: while the UK and France have (different) official definitions, there is still no definition in a country like Germany, or at the European level. Where definitions exist, they often consider that fuel poor households have high energy needs. The possibility of being fuel poor even without having high energy needs and the various arbitrage possibilities of households – i.e. to under-spend and use too little energy – are not systematically discussed. Our paper tries to fill that gap by putting fuel poverty into the larger context of constraints faced by households. Based on a graphical analysis , it shows that different situations of fuel poverty might occur. It results in the identification of two distinct fuel poverty problems: an “energy inequality” problem, reflected by the fact that some households pay disproportionately high energy bills, and an “energy affordability” problem that can affect a larger share of the population. It finally explores the two types of fuel poverty for European countries and discusses policy implications. |
| Keywords: | Fuel poverty; |
| Date: | 2014–02–16 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2014_007&r=ene |
| By: | Rolf Golombek (Ragnar Frisch Centre for Economic Research); Alfonso A. Irarrazabal (Norges Bank (Central Bank of Norway)); Lin Ma (Norwegian University of Life Sciences (NMBU)) |
| Abstract: | In this paper we estimate a dominant firm-competitive fringe model for the crude oil market using quarterly data on oil prices for the 1986-2009 period. All the estimated structural parameters have the expected sign and are significant at standard test levels. We find that OPEC exercised its market power during the sample period. Counterfactual experiments indicate that world GDP is the main driver of long-run oil prices, however, supply (depletion) factors have become more important in recent years. |
| Keywords: | Oil, Dominant firm, Market power, OPEC, Lerner index, Oil deman elasticity, oil supply elasticity |
| JEL: | L13 L22 Q31 |
| Date: | 2014–02–24 |
| URL: | http://d.repec.org/n?u=RePEc:bno:worpap:2014_03&r=ene |
| By: | Gawel, Erik; Strunz, Sebastian; Lehmann, Paul |
| Abstract: | -- It is often argued that Germany's energy transition (the so-called Energiewende) needs to be Europeanized, so as to make the transition process more efficient. In particular, the German system of feed-in tariffs for renewables is criticized for being an obstacle to efficient European energy supply. However, we point out that Germany's approach is no outlier but rather well embedded in the European context of heterogeneous energy policies. Also, full centralization of energy policy decisions on the EU-level is neither desirable from an economic point of view nor a politically feasible option. Against this background, we identify priorities for fostering the European dimension of the Member States' energy policies, such as the coordination of grid extensions and capacity markets. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ufzdps:42014&r=ene |
| By: | Misund, Bard (UiS); Mohn, Klaus (UiS) |
| Abstract: | Previous research clearly suggests that the explanation of excess asset returns is not fully captured by excess return on the market portfolio and the CAPM beta, as implied by Fama-French (1993) three-factor model. Among the large number of studies following in the footsteps of Fama and French, very few studies include industry-specific variables to explain excess asset returns. Using monthly financial data for 117 oil and gas companies from 1992 to 2006, we supplement the Fama French approach with an industry-specific fundamental factor to capture company exposure to oil and gas exploration risk. Our results indicate that exploration risk contributes significantly to the explanation of oil company excess returns over the period. |
| Keywords: | Asset pricing; Oil price; Risk factors |
| JEL: | G12 L71 Q40 |
| Date: | 2014–03–05 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:stavef:2014_004&r=ene |
| By: | Anna Kowalska-Pyzalska; Katarzyna Maciejowska; Katarzyna Sznajd-Weron; Rafal Weron |
| Abstract: | This paper proposes an agent-based modeling (ABM) approach to study the diffusion and adoption of dynamic electricity tariffs. We discuss the difference between opinions and decisions of electricity consumers regarding dynamic pricing. By means of a simple ABM, we provide a plausible explanation for the observed in retail electricity markets discrepancy between the relatively high willingness to adopt dynamic tariffs and the actual low adoption rate. |
| Keywords: | Dynamic electricity tariffs; Intetnion-behavior gap; Innovation diffusion; Agent-based model |
| JEL: | C63 O33 Q48 Q55 |
| Date: | 2014–01–22 |
| URL: | http://d.repec.org/n?u=RePEc:wuu:wpaper:hsc1401&r=ene |
| By: | Tangerås, Thomas P. (Research Institute of Industrial Economics); Mauritzen, Johannes (Dept. of Business and Management Science, Norwegian School of Economics) |
| Abstract: | We analyse in a theoretical framework the link between real-time and day-ahead market performance in a hydro-based and imperfectly competitive wholesale electricity market. Theoretical predictions of the model are tested on data from the Nordic power exchange, Nord Pool Spot (NPS).We reject the hypothesis that prices at NPS were at their competitive levels throughout the period under examination. The empirical approach uses equilibrium prices and quantities and does not rely on bid data nor on estimation of demand or marginal cost functions. |
| Keywords: | Hydro power; market power; Nord Pool Spot |
| JEL: | D43 D92 L13 L94 Q41 |
| Date: | 2014–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhhfms:2014_006&r=ene |
| By: | Shanjun Li; Matthew E. Kahn; Jerry Nickelsburg |
| Abstract: | The U.S. public transit system represents a multi-billion dollar industry that provides essential transit services to millions of urban residents. We study the market for new transit buses that features a set of non-profit transit agencies purchasing buses primarily from a few domestic bus makers. Unlike private vehicles, the fuel economy of public buses is irresponsive to fuel price changes. To understand this finding, we build a model of bus fleet management decisions of local transit agencies that yields testable hypotheses. Our empirical analysis of bus fleet turnover and capital investment suggests that transit agencies: (1) do not respond to energy prices in either their scrappage or purchase decisions; (2) respond to environmental regulations by scrapping diesel buses earlier and switch to natural gas buses; (3) prefer purchasing buses from manufacturers whose assembly plants are located in the same state; (4) exhibit significant brand loyalty or lock-in effects; (5) favor domestically produced buses when they have access to more federal funding. |
| JEL: | R41 R48 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19964&r=ene |
| By: | Levente Timar (Motu Economic and Public Policy Research and GNS Science); Suzi Kerr (Motu Economic and Public Policy Research) |
| Abstract: | This paper documents the development of new land-use intensity and greenhouse gas (GHG) emissions modules for the Land Use in Rural New Zealand (LURNZ) model. These modules translate simulated land-use outcomes into measures of rural economic activity and greenhouse gas emissions for dairy farming and sheep-beef farming. Emissions in LURNZ include those from livestock as well as from synthetic fertiliser use. We utilise the latest set of emission factors along with information on the distribution of rural activities to model GHG emissions in a spatially and temporally explicit manner. Our results at the national level are approximately consistent with New Zealand’s Greenhouse Gas Inventory. |
| Keywords: | Land-use intensity, greenhouse gas emissions, LURNZ |
| JEL: | Q15 Q58 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:mtu:wpaper:14_03&r=ene |
| By: | MIGUEL VAZQUEZ; MICHELLE HALLAC |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:129&r=ene |
| By: | Aaron Cosbey; Petros C. Mavroidis |
| Abstract: | Canada-Renewable Energy presented the WTO Panel and Appellate Body (AB) with a novel Number: at the heart of the dispute was a measure adopted by the province of Ontario whereby producers of renewable energy would be paid a premium relative to conventional power producers. Some WTO Members complained that the measure was a prohibited subsidy because payments were conditional upon using Canadian equipment for the production of renewable energy. The AB gave them right only in part: it found that a local content requirement had indeed been imposed, but also found that it lacked evidence to determine whether a subsidy had been bestowed. The report is, for the reasons explained below, incoherent and could hardly serve as precedent for resolution of similar conflicts in the future. The facts of the case though, do raise legitimate questions both with respect to the specifics of the case, as well as of more general nature regarding the WTO Agreement on Subsidies and Countervailing Measures (SCM Agreement), and the role of the judge when facing legislative failure. In this paper, we provide some responses to these questions in light of the theory and evidence regarding industrial policy in the name of environmental protection. |
| Keywords: | WTO, SUBSIDIES, RENEWABLE ENERGY |
| JEL: | F18 K32 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2014/17&r=ene |
| By: | Andrea Bastianin; Marzio Galeotti; Matteo Manera |
| Abstract: | According to the Rockets and Feathers hypothesis (RFH), the transmission mechanism of positive and negative changes in the price of crude oil to the price of gasoline is asymmetric. Although there have been many contributions documenting that downstream prices are more reactive to increases than to decreases in upstream prices, little is known about the forecasting performance of econometric models incorporating asymmetric price transmission from crude oil to gasoline. In this paper we fill this gap by comparing point, sign and probability forecasts from a variety of Asymmetric-ECM (A-ECM) and Threshold Autoregressive ECM (TAR-ECM) specifications against a standard ECM. Forecasts from A-ECM and TAR-ECM subsume the RFH, while the ECM implies symmetric price transmission from crude oil to gasoline. We quantify the forecast accuracy gains due to incorporating the RFH in predictive models for the prices of gasoline and diesel. We show that the RFH is useless for point forecasting, while it can be exploited to produce more accurate sign and probability forecasts. Finally, we highlight that the forecasting performance of the estimated models is time-varying. |
| Keywords: | Asymmetries, Forecast Evaluation, Gasoline, Crude Oil, Rockets and Feathers |
| JEL: | C22 C32 C53 Q40 Q47 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:mib:wpaper:269&r=ene |
| By: | Rafal Weron |
| Abstract: | A variety of methods and ideas have been tried for electricity price forecasting (EPF), with varying degrees of success. This review article aims at explaining the complexity of available solutions, their strengths and weaknesses, and the opportunities and treats that the forecasting tools offer or that may be encountered. |
| Keywords: | Electricity price forecasting, Day-ahead market, Seasonality, Autoregression, Neural network, Factor model, Forecasts combination |
| JEL: | C22 C24 C38 C53 Q47 |
| Date: | 2014–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:wuu:wpaper:hsc1402&r=ene |
| By: | ALEXANDRE MACCHIONE SAES; NORMA LANCIOTTI |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:029&r=ene |
| By: | Catherine Locatelli (PACTE - Politiques publiques, ACtion politique, TErritoires - Institut d'Études Politiques [IEP] - Grenoble - CNRS : UMR5194 - Université Pierre-Mendès-France - Grenoble II - Université Joseph Fourier - Grenoble I) |
| Abstract: | The Russian gas sector is undergoing significant changes which is opening the way for an original reform. Because of the particular institutional and economic context of the country, this reorganisation is not taking place along the lines of the de-integrated model of the EU. It is characterised by increasingly significant competitive fringes. Gazprom remains the main actor of the Russian gas industry but the company is facing challenges on its main export market and an increasing competition at home with the arrival of new gas firms, independents and Russian oil companies. For Gazprom, the aim issue is to develop more flexible strategies for export markets but also on its internal market. These internal changes will not be without consequence on the country's export strategy and the implication for international markets could be considerable. |
| Keywords: | Russia ; reform of the gas organisational model ; institutional analysis ; Gazprom ; gas industry |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-00853776&r=ene |
| By: | Mauritzen, Johannes (Dept. of Business and Management Science, Norwegian School of Economics) |
| Abstract: | I use detailed field-level data on Norwegian off-shore oil field production and a semi-parametric additive model to control for the production profile of fields to estimate the effect of oil prices on production. I find no significant evidence of a concurrent reaction of field production to oil prices, though a slight lagged effect is found of the magnitude of approximately 2 to 4% for a 10 dollar per barrel increase in the real price of oil. Most of this effect appears to come in the planning phase of a field’s development. |
| Keywords: | Oil prices; offshore production |
| JEL: | Q00 Q40 |
| Date: | 2014–02–28 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nhhfms:2014_007&r=ene |
| By: | EDMAR LUIZ FAGUNDES DE ALMEIDA; LUCIANO LOSEKANN; GUSTAVO MARREIRO; FRANCISCO JAVIER RAMOS-REAL |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:134&r=ene |
| By: | Arora, Vipin |
| Abstract: | I estimate short and long-run price elasticities of U.S. natural gas supply and demand. For robustness, the estimates are based on data of varying frequencies and samples, some of which include the recent U.S. shale gas boom. Aside from the numbers themselves, there are two main conclusions. As expected, U.S. price elasticities of natural gas supply are higher in both the short and long-run when the e�ffects of shale are included in the sample (post-2007). The calculated price elasticities of natural gas demand are also more responsive than recent estimates, but in-line with earlier ones. |
| Keywords: | Natural gas, sign restriction, shale, elasticity, long-run, short-run |
| JEL: | C32 E37 Q41 |
| Date: | 2014–03–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:54232&r=ene |
| By: | Jakub Nowotarski; Rafal Weron |
| Abstract: | We evaluate a recently proposed method for constructing prediction intervals, which utilizes the concept of quantile regression (QR) and a pool of point forecasts of different time series models.We find that in terms of interval forecasting of Nord Pool day-ahead prices the new QR-based approach significantly outperforms prediction intervals obtained from standard, as well as, semi-parametric autoregressive time series models. |
| Keywords: | Electricity spot price; Prediction interval; Quantile regression; Forecasts combination |
| JEL: | C22 C24 C53 Q47 |
| Date: | 2014–03–10 |
| URL: | http://d.repec.org/n?u=RePEc:wuu:wpaper:hsc1403&r=ene |
| By: | Rabindra Nepal (School of Economics, The University of Queensland); Tooraj Jamasb (Durham University Business School) |
| Abstract: | Incentive regulation needs to adapt to the emerging changes in the operating environment of the electricity networks and take into account the security of these. This paper assesses the current issues and options in economic regulation of network security across the European electricity systems. An output-oriented incentive regulatory approach combines the efficiency promoting mechanisms in a revenue cap framework with output-based incentives such as better provision of network security. Thus, incentive regulation is destined to move from pursuing the optimal to being more practical. The RIIO regulatory framework in the UK and the service quality regulation in Italy provide good examples of application of output-based regulation. We also propose an output-based approach for regulation of network security, which accounts for the risks from natural, accidental and malicious threats. We conclude that regulation for network security may also involve looking beyond economic network regulation and focus on the wider security policy and regulation interface considering the risks facing the electricity networks. |
| Date: | 2014–03–04 |
| URL: | http://d.repec.org/n?u=RePEc:qld:uq2004:505&r=ene |
| By: | Mohamed Arouri; Aviral Kumar Tiwari; Frédéric Teulon |
| Abstract: | We study lead-lag relationships between oil price and trade balance for India by using monthly data covering the period from January 1980 to December 2011 and post current account convertibility era (from August 1994 to December 2011). We adopt the approach proposed by Breitung and Candelon (2006) along-with the traditional VAR based conditional Grangercausality. Results of VAR based conditional Granger-causality provide evidence of bidirectional causal relationship in both study periods. Impulse response analysis shows positive response of oil price to one innovation shock in trade balance whereas trade balance shows negative response to one innovation shock in oil price. Though, frequency domain analysis also provides evidence of bidirectional causal relationship but that hold for dissimilar frequencies of short and medium run in the full sample. Moreover, more strength and high degree of cyclicality are found when causality is running from oil price to trade balance. Interestingly, results of the post current account convertibility provide evidence of frequency domain causality running from oil price to trade balance at short, medium and long run not the otherwise. Hence, our study shows that the oil price has become a leading indicator for Indian trade balance in the short, medium and long horizons. |
| Keywords: | Oil prices, trade balance, frequency domain, India |
| JEL: | C22 F41 |
| Date: | 2014–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:ipg:wpaper:2014-116&r=ene |
| By: | Per G. Fredriksson; Xenia Matschke |
| Abstract: | The literature on trade liberalization and environment has not considered federal structures. This paper shows how the design of environmental policy in a federal system has implications for the effects of trade reform. Trade liberalization leads to a decline in pollution taxes regardless of whether pollution taxes are set at the federal (centralized) or local (decentralized) level, and it increases social welfare. The effect under a decentralized system is smaller than if these taxes are set by the federal government, and pollution emissions therefore decline in this case. Moreover, majority bias interacts with trade liberalization if federal taxes are used. |
| Keywords: | trade and environment, environmental policy, trade liberalization, environmental federalism, political economy, majority bias, social welfare |
| JEL: | F1 H2 H7 Q2 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:trr:wpaper:201404&r=ene |
| By: | Ibrahim Alhulail (Graduate School of Economics, Kobe University); Kenji Takeuchi (Graduate School of Economics, Kobe University) |
| Abstract: | This study examines the effects of economic incentives on the sales of ecofriendly vehicles in Japan. We focus on the Tonnage and Acquisition Tax Cuts for Eco-Friendly Vehicles and the two waves of Eco-Car Subsidies implemented in Japan. We use the monthly sales data of 10 vehicles from April 2006 to March 2013. We find that the effects of the tax incentives were more significant than the effect of gasoline price. This is in contrast to results from the United States and Canada, where gasoline prices have had a larger effect on increasing the adoption levels of hybrid electric vehicles. The difference is due to the structure of the tax cut. Japanfs policy of taxes paid upon purchase was more effective compared to the policies in the United States and Canada, where certain tax cuts were on income taxes. |
| Keywords: | Eco-Friendly Vehicle, Hybrid Electric Vehicle, Tax Cuts, Subsidy, Gasoline Prices |
| JEL: | L62 Q55 Q58 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:koe:wpaper:1412&r=ene |
| By: | Haouas, Ilham (Abu Dhabi University); Heshmati, Almas (Sogang University) |
| Abstract: | Recent research conclude that the GCC economies have failed to address the oil curse. They are far behind other countries, especially those in the G7, which possess huge reserves of oil wealth but have undertaken economic diversification to correct the ill-effects of an oil curse. This paper takes an in-depth look into the UAE economy as a model but also as a reminder of the struggles ahead. The findings support the fact that the UAE is facing an oil curse. Declining levels of total factor productivity, GDP volatility, negative returns on investment, and a labor force that is too reliant on government's supply of jobs are among the many reasons that support the thesis. The UAE has made good progress in recent years to diversify its economy. However, the drivers of economic growth in the UAE are vulnerable to external shocks outside of the Emirate's control. It is now critical that the UAE take steps to mitigate economic disruptions that might result from these shocks. In this case study the UAE economic performance is examined, and a data-driven roadmap for sustainable growth is suggested. The analysis shows that greater efforts are needed to stimulate the diversification of the production base by encouraging increased domestic, especially private, investment. Well-targeted policies should be adopted to accelerate reform and facilitate the involvement of the private sector in the economy. |
| Keywords: | growth accounting, TFP, oil curse, economic diversification, UAE |
| JEL: | C22 E20 L16 L71 O11 O53 |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp8003&r=ene |
| By: | Matthew J. Holian; Matthew E. Kahn |
| Abstract: | In recent years, Californians have voted on two key pieces of low carbon regulation. The resulting voting patterns provide an opportunity to examine the demand for carbon mitigation efforts. Household voting patterns are found to mirror the voting patterns by the U.S Congress on national carbon legislation. Political liberals and more educated voters favor such regulations while suburbanites tend to oppose such initiatives. Survey responses at the individual level are shown to predict the spatial variation in actual voting patterns and hence convergent validity for results obtained with stated preference data on voting markets. |
| JEL: | Q54 R41 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:19965&r=ene |
| By: | Kozo Mayumi (Faculty of Integrated Arts and Sciences, The University of Tokushima); Mario Giampietro (Institut de Ciencia i Tecnologia Ambientals, Universitat Autònoma de Barcelona) |
| Abstract: | This paper addresses the surprising lack of quality control on the analysis and selection on energy policies observable in the last decades. As an example, we discuss the delusional idea that it is possible to replace fossil energy with large scale ethanol production from agricultural crops. But if large scale ethanol production is not practical in energetic terms, why huge amount of money has been invested in it and is it still being invested? In order to answer this question we introduce two concepts useful to frame, in general terms, the predicament of quality control in science: (i) the concept of “granfalloons” proposed by K. Vonnegut (1963) flagging the danger of the formation of “crusades to save the world” void of real meaning. These granfalloons are often used by powerful lobbies to distort policy decisions; and (ii) the concept of Post- Normal science by S. Funtowicz and J. Ravetz (1990) indicating a standard predicament faced by science when producing information for governance. When mixing together uncertainty, multiple-scale and legitimate but contrasting views it becomes impossible to deal with complex issue using the conventional scientific approach based on reductionism. We finally discuss the implications of a different approach to the assessment of alternative energy sources by introducing the concept of Promethean technology. |
| Keywords: | energy policy, biofuel, ethanol, Post-Normal science, Promethean technology, responsible development |
| JEL: | O11 P48 Q43 Q57 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:aub:uhewps:2014_01&r=ene |
| By: | G. Feichtinger; L. Lambertini; G. Leitmann; S. Wrzaczek |
| Abstract: | We extend a well known differential oligopoly game to encompass the possibility for production to generate a negative environmental externality, regulated through Pigouvian taxation and price caps. We show that, if the price cap is set so as to fix the tolerable maximum amount of emissions, the resulting equilibrium investment in green R&D is indeed concave in the structure of the industry. Our analysis appears to indicate that inverted-U-shaped investment curves are generated by regulatory measures instead of being a ‘natural’ feature of firms’ decisions. |
| JEL: | C73 L13 O31 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:bol:bodewp:wp929&r=ene |
| By: | John Cotter (UCD School of Business, University College Dublin); Jim Hanly (UCD School of Business, University College Dublin) |
| Abstract: | Hedgers as investors are concerned with both risk and return; however the literature has generally neglected the role of both returns and investor risk aversion by its focus on minimum variance hedging. In this paper we address this by using utility based performance metrics to evaluate the hedging effectiveness of utility based hedges for hedgers with both moderate and high risk aversion together with the more traditional minimum variance approach. We apply our approach to two asset classes, equity and energy, for three different hedging horizons, daily,weekly and monthly. We find significant differences between the minimum variance and utility based hedges and their attendant performance in-sample for all frequencies. However out of sample performance differences persist for the monthly frequency only. |
| Keywords: | Energy, Hedging Performance; Utility, Risk Aversion |
| JEL: | G10 G12 G15 |
| Date: | 2014–02–19 |
| URL: | http://d.repec.org/n?u=RePEc:ucd:wpaper:201404&r=ene |
| By: | Juan Infante Amate; Eduardo Aguilera; Manuel González de Molina |
| Abstract: | The main objective of this work is to reconstruct the consumption of the different types of energy by the Spanish agri-food system (AFS) between 1960 and 2010. The initial hypothesis, of a high increase in energy consumption during that period, was derived from the evidence of a growing consumption of capital and inputs in the activities related with production and management of food products in Spain. According to our results, energy consumption in the whole Spanish agro-food chain has increased by a factor of 10. It has grown at a much faster pace than total energy consumption, than total food production and even than GDP. Transport and agriculture are the sectors with the most relevant energy use in the studied period, representing 47-60% of total AFS consumption. In a first stage, agricultural production absorbed the majority of the growth in energy consumption, while since 1985 other sectors have pushed the continuation of the growth. Our results indicate that roughly one fifth of final energy consumed by Spanish economy is related. |
| Keywords: | Agri-food System, Energy Balances, Life Cycle Assessment, EROI, Degrowth, Food History |
| JEL: | N54 O13 Q4 Q18 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:seh:wpaper:1403&r=ene |
| By: | John Eakins (School of Economics, University College Cork and Surrey Energy Economics Centre (SEEC), School of Economics, University of Surrey.) |
| Abstract: | The objective of this study is to examine the determinants of household petrol and diesel expenditures using a large micro data set of Irish households. This research is timely given the switch in purchases from petrol cars to diesel cars arising out of changes in how vehicle registration tax and motor tax rates are calculated. The study finds that households living in urban areas, households that spend money on public transport and households that do not possess a car will spend less on both petrol and diesel. In contrast, households in possession of higher number of cars, households with more occupants working and households with higher level of household spending will spend more on petrol and diesel. The econometric methodology employed takes into account the fact that the dependent variable contains zero expenditures. Such an approach has never previously been applied to analyse Irish household transport use and provides interesting insights. In particular the effect that the explanatory variables have on participation in the market is quite different for petrol and diesel. For example, the model predicts a much larger increase in the probability that households will participate in the diesel market relative to the petrol market as income increases. This finding has implications for the design of policy toward reducing transport emissions as the Irish economy recovers and average household income increases. |
| Keywords: | Household Transport Demand, Petrol, Diesel, Double Hurdle Model, Income Elasticities. |
| JEL: | C34 D12 Q41 |
| Date: | 2014–03 |
| URL: | http://d.repec.org/n?u=RePEc:sur:seedps:145&r=ene |
| By: | Yutaka Ito (Graduate School for International Development and Cooperation, Hiroshima University); Ram Dhital (Alternative Energy Promotion Centre, Nepal); Daisaku Goto (Graduate School for International Development and Cooperation, Hiroshima University); Masaru Ichihashi (Graduate School for International Development and Cooperation, Hiroshima University); Takahiro Ito (Graduate School of International Cooperation Studies, Kobe University); Shinji Kaneko (Graduate School for International Development and Cooperation, Hiroshima University); Keisuke Kawata (Graduate School for International Development and Cooperation, Hiroshima University); Satoru Komatsu (Graduate School for International Development and Cooperation, Hiroshima University); Yuichiro Yoshida (Graduate School for International Development and Cooperation, Hiroshima University) |
| Abstract: | Mountainous hinterland in rural Nepal lacks fundamental social infrastructure. Lack of electricity causes difficulty of water provision, especially in mountainous area where villagers, especially ladies, youths and children, often spends large amount of time just to convey water. To overcome this challenge, installation of solar water pumping system (SWPS) is recently being implemented nation-wide in Nepal. Confrontation of the Nepali government with her tight financial constraint requires the installation process be both economically and technologically sound. By collecting original field data from 38 wards (i.e., villages) in all seven regions in the entire Nepal, this paper thus identifies the technically efficient cases of SWPS, and then investigates any potential economic policy that will enhance the performance of SWPS. Our results show, inter-alia, that abundant financial support from the government results in inefficient systems, and that charging user fees significantly discourages villagersf participation to SWPS and hence undermines the potential benefit of SWPS. |
| Keywords: | solar water pumping system, rural development, data envelopment analysis |
| Date: | 2014–02 |
| URL: | http://d.repec.org/n?u=RePEc:hir:idecdp:3-13&r=ene |
| By: | MARCO ANTONIO MONTOYA; CÁSSIA APARECIDA PASQUA |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:199&r=ene |
| By: | ALINE SOUZA MAGALHAES; EDSON PAULO DOMINGUE |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2013:191&r=ene |
| By: | Hecking, Harald (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Panke, Timo (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | This paper investigates the benefits of a merger when goods are complements and firms behave in a Cournot manner both in a theoretical model as well as in a real-world application. In a setting of two complementary duopolies a merger between two firms each producing one of the goods always increases the firms’ total profit, whereas the remaining firms are worse off. However, allowing for a restriction on one of the merging firms’ output, we proof that there exists a critical capacity constraint (i) below which the merging firms are indifferent to the merger, (ii) above which the merger is always beneficial and (iii) the lower the demand elasticity is the smaller this critical capacity constraint becomes. Using a spatial multi-input equilibrium model of the iron ore and coking coal markets, we investigate whether our theoretical findings may hold true in a real market as well. The chosen industry example is particularly well suited since (a) goods are complements in pig iron production, (b) each of the inputs is of little use in alternative applications, (c) international trade of both commodities is highly concentrated and (d) a few (large) firms are active in both input markets. We find that due to limited capacity, these firms gain no substantial extra benefit from optimising their divisions simultaneously. |
| Keywords: | Cournot Oligopolies; Parallel Vertical Integration; Complementary Inputs; Applied Industrial Organisation; Mixed Complementarity Problem |
| JEL: | C61 D43 L22 Q31 Q41 |
| Date: | 2014–02–16 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2014_006&r=ene |
| By: | PAULO HENRIQUE PEREIRA DE MENESES VAZ |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:088&r=ene |
| By: | ALINE SOUZA MAGALHÃES; ADMIR ANTÔNIO BETARELLI JÚNIOR; EDSON PAULO DOMINGUES |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:anp:en2012:203&r=ene |
| By: | Phan, Tuan |
| Abstract: | Using Vensim PLE, this paper provides a simulation of the illegal coal mining in Quang Ninh province, Vietnam. Examining the three main loops including need for income effect, government enforcement and coal management effects and other effects (illegal density, technology, community and psychological effects), the paper sketches several scenarios under different levels of the key variables. Obtaining these results, the paper suggests a better scene in terms of socio-economic and environmental sustainability basing on the two major components. First, the government authorities should urge the enforcement and revise the coal management. Second, the community should have more active activities to abolish the illegal mining trend and raise effectively warnings about the danger of the illegal mining. Those parallel implementations shall create a surprisingly positive effect on the reduction of illegal coal mining in the province. |
| Keywords: | illegal coal mining, simulation, Vietnam |
| JEL: | Q32 Q38 |
| Date: | 2008–06–06 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:54068&r=ene |