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on Energy Economics |
| By: | Noël Bonneuil (Institut national d’études démographiques, and École des hautes études en sciences sociales); Raouf Boucekkine (Aix-Marseille University (Aix-Marseille School of Economics), CNRS & EHESS) |
| Abstract: | When cheap fossil energy is polluting and pollutant no longer absorbed beyond a certain concentration, there is a moment when the introduction of a cleaner renewable energy, although onerous, is optimal with respect to inter-temporal utility. The cleaner technology is adopted either instantaneously or gradually at a controlled rate. The problem of optimum under viability constraints is 6-dimensional under a continuous-discrete dynamic controlled by energy consumption and investment into production of renewable energy. Viable optima are obtained either with gradual or with instantaneous adoption. A longer time horizon increases the probability of adoption of renewable energy and the time for starting this adoption. It also increases maximal utility and the probability to cross the threshold of irreversible pollution. Exploiting a renewable energy starts sooner when adoption is gradual rather than instantaneous. The shorter the period remaining after adoption until the time horizon, the higher the investment into renewable energy. |
| Keywords: | multi-stage optimal control, threshold e?ects, irreversibility, non-renewable resources, viability |
| JEL: | Q30 Q53 C61 O33 |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1434&r=ene |
| By: | Lyons, Ronan |
| Abstract: | Residential buildings account for a significant proportion of all emissions of greenhouse gases. It is the aim of EU policy to reduce emissions by up to 95% by 2050. This means that the energy efficiency of the stock of residential property will need to improve dramatically. But will such improvements be rewarded in the property market?Using a dataset of Belgian property listings from 2012, this research explores the extent to which energy efficiency is rewarded in the various sales and lettings segments of the Belgian property market. The study further investigates whether the premium to energy efficiency varies across Flanders, Wallonia and Brussels. Lastly, the detailed natured of the CPEB energy efficiency rating and large dataset allow an investigation of non-linearities in the energy efficiency premium, a heretofore unexplored aspect of the relationship between energy efficiency and accommodation costs. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_261&r=ene |
| By: | Luciano de Castro; Shmuel Oren; Alvaro Riascos; Miguel Bernal |
| Abstract: | This paper evaluates the impact of Resolution CREG 051 on the performance of the electricity markets in Colombia. We found out that productive efficiency has improved since the introduction of the Resolution, that is, the total costs of producing electricity have been reduced. This shows a positive impact of the Resolution. On the other hand, we also found that mark-ups and forward energy prices (from bilateral contracts) have increased since 2009, suggesting that there was an increase in the exercise of market power by producers. From the two previous points, we conclude that, although the productive efficiency has increased, the larger share of the efficiency gains were appropriated by the energy producers, rather than passed on to consumers. Classification JEL: D22, D44, L94, Q41 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:bdr:borrec:830&r=ene |
| By: | Bélanger, Philippe |
| Abstract: | Energy efficiency is one of the more economically sounds way to sustainability. Real Estate accounts for 30% of energy consumption in most developed countries. It also accounts for more than 30% of GHG emission. In the last several years many research have been looking to energy efficiency technology. Very few of them include the future energy price forecast in their valuation. Very few of them include the fact that different energy source savings may have different value. This paper demonstrates that one euro of annual energy savings in different source has a very different value when we account for expected future cost. It also underlines the fact that energy source prices are more or less volatile depending on sources. This should imply different discount rate for investment in technology that involves savings of those energy sources with high prices volatility. Following this demonstration the paper support the idea that whoever assesses the value of energy efficiency have to make assumption on energy source saved, future energy prices, appropriate discount rate and maturity of the investment. When researchers and professionals omit to do those assumptions explicitly they do it implicitly.Hedonic models have been widely used by researcher to assess the value of buildings properties. We use forecast at the moment of the transaction to underline the integration of energy efficiency value in building valuation with hedonic models. We use a US database to investigate the relationship between building energy consumption and building value. We also investigate this relationship with rent. Results suggest that the energy consumption that impacts the rent value is different from those who impact transaction price. It appears that overall energy cost impact the rent value, but not the transaction price.In conclusion, the economic sustainability assessment of an energy savings investment must take into account energy sources and future price. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_209&r=ene |
| By: | Zalejska-Jonsson, Agnieszka; Lind, Hans |
| Abstract: | Energy-efficiency has received much attention from policy makers and the issue of reducing energy consumption in buildings has faced a true challenge in balancing incitements, restrictions and cost-effectiveness for required changes. The literature shows that technological change and technology diffusion is an important factor in overcoming cost barriers. On the other hand, before adaptation process begins the new technology must show possibility for profit and return on costs. This paper aims at discussing technological change in building construction in context of diffusion and adaptation of very low-energy technological solutions. We are tracing technological development in three aspects: wall construction, windows energy-efficiency improvement and mechanical ventilation, solutions used preliminary in construction of passive houses. We examine how those technological changes influenced cost-effectiveness and profitability of low-energy building projects. The investigation is approached by analysis of market and policy incentives and the role those factors had on diffusion of new energy-efficient technologies. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_137&r=ene |
| By: | Don Fullerton; Li Gan; Miwa Hattori |
| Abstract: | Using three years of data from the 47 prefectures of Japan, we estimate behavior of households who simultaneously make discrete decisions about vehicle ownership and continuous decisions about driving distance. We use the estimated parameters to calculate elasticities and to simulate the effects of alternative pollution control policies such as taxes on gasoline, on distance, or on particular cars. Given choices about cars and distance, we also calculate emissions. Since we model simultaneous choices, both the chosen distance and the chosen car can be affected either by a tax on distance or by a tax on car characteristics. We find expected signs for coefficients on price and income. Car choices are relatively inelastic, however, either to taxes on cars or to taxes on gas or distance. Thus emissions are more affected by taxes on gasoline than by taxes on particular vehicles. Yet taxes on cars have lower costs on consumers and thus lower marginal cost of abatement. Given that the existing gas tax already achieves some abatement, mostly through driving reduction, this analysis suggests that further abatement from the use of distance-reducing taxes is more costly than achieving some marginal abatement from induced changes in car choices. The option with the lowest cost is to tax each car at a rate proportional to its emission rate. |
| JEL: | H23 Q52 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20333&r=ene |
| By: | Jonas M\"uller; Marcus Hildmann; Andreas Ulbig; G\"oran Andersson |
| Abstract: | The grid integration of intermittent Renewable Energy Sources (RES) causes costs for grid operators due to forecast uncertainty and the resulting production schedule mismatches. These so-called profile service costs are marginal cost components and can be understood as an insurance fee against RES production schedule uncertainty that the system operator incurs due to the obligation to always provide sufficient control reserve capacity for power imbalance mitigation. This paper studies the situation for the German power system and the existing German RES support schemes. The profile service costs incurred by German Transmission System Operators (TSOs) are quantified and means for cost reduction are discussed. In general, profile service costs are dependent on the RES prediction error and the specific workings of the power markets via which the prediction error is balanced. This paper shows both how the prediction error can be reduced in daily operation as well as how profile service costs can be reduced via optimization against power markets and/or active curtailment of RES generation. |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1407.7237&r=ene |
| By: | Tao Hong; Katarzyna Maciejowska; Jakub Nowotarski; Rafal Weron |
| Abstract: | Probabilistic load forecasting is becoming crucial in today's power systems planning and operations. We propose a novel methodology to compute interval forecasts of electricity demand, which applies a Quantile Regression Averaging (QRA) technique to a set of independent expert point forecasts. We demonstrate the effectiveness of the proposed methodology using data from the hierarchical load forecasting track of the Global Energy Forecasting Competition 2012. The results show that the new method is able to provide better prediction intervals than four benchmark models for the majority of the load zones and the aggregated level. |
| Keywords: | Electric load; Probabilistic forecasting; Prediction interval; Quantile regression; Forecasts combination; Expert forecast |
| JEL: | C22 C32 C38 C53 Q47 |
| Date: | 2014–07–15 |
| URL: | http://d.repec.org/n?u=RePEc:wuu:wpaper:hsc1410&r=ene |
| By: | Kovacic, Iva; Waltenberger, Linus |
| Abstract: | The minimal investment cost, flexibility and expandability of the built structure were the highest priority planning aims in the development and planning of industrial facilities and production halls. With the sharpening of the building codes and upcoming of European polices on climate protection and energy efficiency – such as the plus-energy buildings, the life cycle optimization is starting to gain importance with industrial investors. Optimized, highly efficient building hull and building services play crucial role in the realization of over-all energy-concept of modern industrial facility.In the case study of energy efficient industrial facility within the research project INFO (Interdisciplinary Research for Energy efficient Production) a tool for calculation of life cycle costs and emissions of the building hull was developed. For the proposed building model of industrial facility three different façade-typologies (metal sheets, metal-sandwich panels, wood panels) were simulated and calculated by the tool. In terms of ecology (CO2 emissions) the wood-based façade features the best performance, however is most costly in the initial costs, which would have been a knock-out criterion when planning an industrial facility in the past. However, the life-cycle cost related findings imply that even though the examined typologies feature large differences in the initial cost, after a period of 50 years of life-time all three façade-types sum up to the same amount of life-cycle costs. We argue that for achievement of sustainability aims therefore a long term view is necessary, as well as further development of planning tools which support decision-making process in the early design phases. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_234&r=ene |
| By: | Frederic Gonand |
| Abstract: | Redistributing the income of a carbon tax impacts the economic activity and the intergenerational inequality, which both influence the intertemporal social welfare. Thus the way a social planner recycles a carbon tax is influenced by its degree of aversion to intergenerational inequality. This article analyses the effect of social aversion to intergenerational inequality on the social choice as concerns implementing and redistributing a carbon tax. It relies on a detailed computable general equilibrium model with overlapping generations and an energy module, with a parameterisation on empirical data. We use two types of social welfare functionals which both incorporate a variable parameter measuring the degree of aversion of the social planner to intergenerational inequality. Results suggest that the social planner recycles a carbon tax through higher public expenditures if its aversion to intergenerational inequity is relatively high. This holds even if recycling through lower income taxes increases activity. |
| Keywords: | Energy transition, intergenerational redistribution, social choice, overlapping generations, carbon tax, general equilibrium. |
| JEL: | D58 D63 E62 L7 Q28 Q43 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:cec:wpaper:1412&r=ene |
| By: | Fuerst, Franz; Nanda, Anupam; Wyatt, Peter |
| Abstract: | Following the EU Energy Performance of Buildings Directive requiring all buildings at construction, sale or rent (or every ten years) to have certificates providing information about their energy performance through a rating of CO2 emissions, Energy Performance Certificates (EPCs) and the Display Energy Certificates (DECs) were introduced in the UK in 2008. An EPC consists of an asset rating which is intended to inform potential buyers or occupiers about the intrinsic energy performance of a building. In the same vein as consumer products, buildings are rated on a scale A to G with A being the most efficient. This paper outlines the results of the first large-scale empirical analysis of their effects on residential property prices in England and Wales. It draws upon a sample of approximately 400,000 dwellings in England and Wales that had sold in the period from 1995 to 2011. To enable repeat-sales analysis, the sample included a large proportion of dwellings that had sold more than once. The hedonic model specifications reveal that compared to dwellings EPC rated G, dwellings with better EPC ratings have sold at a significant price premium. This willingness to pay for superior EPC ratings are robust and consistent across several model specifications and samples. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_246&r=ene |
| By: | Glumac, Brano; Marieke, Oosterbaan; Schaefer, Wim |
| Abstract: | Within the maintenance activities of non-residential real estate, there is a substantial potential to implement energy efficiency measures leading to the reduction of energy consumption. A focus on the optimization of energy usage can contribute to lowering overall maintenance and energy costs, preserving the technical performance of a building, and realizing energy saving objectives. Therefore a dynamic assessment tool to support an optimal energy usage in a non-residential building was developed. The tool is based on a system dynamic model that has sensitive variables for: two potential maintenance scenarios, external factors, and case specific conditions. In addition, by introducing a case study of Nijmegen City Hall the assessment tool has been verified. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_66&r=ene |
| By: | Copiello, Sergio; Bonifaci, Pietro |
| Abstract: | The theme of buildings' energy efficiency occupies a prominent place on the agenda. This study aims to assess the convenience of improving the energy performance of residential buildings: higher costs to be incurred during construction or renovation are offset by lower operating costs? The point of view is purely financial, externalities are not considered. The evaluation model is set on the discounted cash flow analysis, and partly based on life cycle assessment methodology. Variables are simplified by comparing the incremental costs of investment with the savings achieved on energy supply cost.The model is applied to three case studies located in the Northern Italy. The first is related to the design of a new single-family house. The second and third cases concern the renovation of two different public housing estates. For all cases several improvement alternatives are analyzed.The estimate of the investments constitutes a critical element; the literature has shown that many thermo-economic studies may underestimate them, due to the lack of consideration of hidden costs. The discount rate is estimated as the opportunity cost of capital, and thus in a range representative for an household interested in investing in energy efficiency.Most of the alternatives analyzed are not feasible: the discounted amount of savings is not enough to fairly compensate or fully reimburse the investment. Additional simulations were performed, considering several trends of the future growth in energy prices. If the energy prices grow considerably, each of the project alternatives analyzed will exhibit a higher convenience, and some of them will become feasible within the time frame considered.The results of the research can be summarized as follows: investment in upgrading the energy efficiency of residential buildings currently lacks viability, in purely financial terms. Nevertheless, it can be interpreted, as a hedge against the risk that the prices of energy supply will grow significantly in the coming years. As original contribution, this research allows to highlight a new kind of energy efficiency paradox: improving buildings performance should allow to reduce both climate-altering emissions and, in an efficient market, the prices of energy supplies, but decreasing energy prices disincentive to invest in buildings improvement. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_37&r=ene |
| By: | Aydin, Erdal; Brounen, Dirk; Kok, Nils |
| Abstract: | Energy labels have proven to be an effective means for nudging households to make sustainable choices. The label information regarding future energy use has inspired consumers around the world to opt for more energy efficient cars to commute to work and to select more efficient appliances at home. But regarding the home itself, energy labels have been less successful, or so it seems. In order to have an effect on consumer choice, energy labels need to meet three conditions, they need to be available, understandable, and reliable. In this paper, we examine the extent to which these criteria are met using a unique, detailed microeconomic dataset that contains information regarding the home, utility bills and energy labels for 779,383 addresses in the Dutch housing market. Since 2008, energy labels are available in this market, since 2010 these energy labels are understandable to consumers, and our results show that these labels are 81% reliable when compared to subsequent energy bills. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_88&r=ene |
| By: | Wilkinson, Sara J. |
| Abstract: | Retrofit and adaptation of the existing building stock is an essential factor in man-kinds attempts to mitigate the effects of climate change and global warming. Pointedly most of the global stock was constructed with no consideration of sustainability. In Australia environmental sustainability for commercial buildings was legislated in the Building Code of Australia in 2006, with minimum standards for energy efficiency applied to new build and some retrofit projects. The City of Melbourne launched the 1200 Buildings Program in 2008 as a key strategy to deliver carbon neutrality by 2020 after Arup (2008) concluded that CBD 1200 commercial office retrofits, some two thirds of the total stock, would deliver a 38% reduction in greenhouse gas emissions. This research examined what has been undertaken in respect of the commercial retrofits undertaken as part of the 1200 Buildings Program. This study had two aims which were firstly; to gain a deeper understanding of the improvements made to existing office buildings in the 1200 Buildings Program and secondly, to undertake a comparison of current practice to identify similarities and differences in approach to retrofit within the 1200 Buildings Program. The case studies showed the sustainability measures undertaken were largely focussed on building services and energy efficiency. There was less work undertaken to address water economy measures, to the building fabric and little work, which addressed social sustainability aspects. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_2&r=ene |
| By: | Wahlström, Marie |
| Abstract: | In line with directives from the European Union, member countries have adopted measures aiming to reduce the energy use in the real estate sector. In Sweden, sellers of residential housing have to provide potential buyers with an energy certificate with detailed information on energy performance and consumption. The idea is to make users more aware of their energy consumption and of different ways to reduce it. This paper studies to what extent the energy certificates for single-family house owners in Sweden, introduced in 2009, seem to work in the way expected. More specifically, the following questions are addressed: • What role does preferences and household characteristics play for energy consumption as compared with the energy related attributes of their house? E.g. does energy consumption depend more on technical installations such as heat pumps or is household composition a stronger influencer? • Is there a willingness to pay more for houses with “betterâ€? energy performance? How large is this price premium? An econometric approach is used to address the questions. Energy consumption is related to both housing attributes, including energy-related factors, and household characteristics, including income. A hedonic price model is used to analyze implicit prices for the various attributes. A unique feature is the large set of energy-related attributes included in the database (all single-family houses sold in Sweden 2009-2010), which also comprises individual household data. To our knowledge, this is the largest empirical work performed in Sweden on this matter. The results will be compared with those of similar studies. However, the Swedish case is interesting in itself. In Sweden, 3% of the disposable income goes to energy consumption; twice as much as the EU average. Our data represents three different climatic zones. The average annual temperature varies from -5 in the north to 9°C in the south, which is quite unique in an international perspective.Preliminary results show that the energy consumption in a house is partly depending on the building’s characteristics, such as vintage, and partly on the household’s characteristics, such as size and composition. The hedonic model shows that there is a price premium for energy efficient houses. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_331&r=ene |
| By: | Bonifaci, Pietro; Copiello, Sergio |
| Abstract: | In the last years several studies about the relationship between buildings' energy performance and residential property prices in Europe have been published. Nevertheless, there is a lack of studies regarding the Italian real estate market, probably due to the difficulties to access official data on property characteristics and transactions prices.Following the recast of European Commission's Energy Performance of Building Directive (2010/31/EU), since 2012, in Italy, is mandatory to provide information about energy performance on the real estate advertisements for the sale of a property, including energy label and CO2 emissions. Buildings are rated on a scale A to G, with A being the highest rating.The purpose of this research is to evaluate the impact of buildings' energy performance, as expressed by Energy Performance Certificates (EPCs), on the prices of residential properties in the city of Padua, representative of medium-size cities in Northern Italy.The study is based on a hedonic price model which aims to estimate the impact on house prices due to the improvement of energy performance. The study adopts a semi-logarithmic regression model. The analysis is performed on a dataset of nearly a thousand dwellings, listed on websites for property sales.The model considers as dependent variable the offer prices of dwellings, and includes indipendent variables that represent attributes such as location, typology, dimension, mainteinance condition and other features, as well as the energy label.The dwellings are all located in the city of Padua, with the exclusion of some areas of the city centre, in which the location variable could prevail on the others independent variables. The data collection period lasted from July to September 2013.Empirical findings show a positive and statistically significant relationship between buildings with better EPCs and house prices. Furthermore the relationship is stronger from class G to C, than from class C to A. The price premium for a higher energy rating is tested for robustness and consistency. Nevertheless, the study reveals a negative gap between the net present value of potential future savings and the estimated price premium. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_38&r=ene |
| By: | Hofmann, Marina; Linke, Hans Joachim; Müller, Nikolas; Pfnür, Andreas |
| Abstract: | The German cities Frankfurt, Munich and Stuttgart approach their climate protection initiatives in the real estate sector with different measures although their goals are nearly the same. This paper examines the underlying efficiency understanding and further limitation factors in the municipal decision-making process. The focus is on the requirements and promotion of energy efficiency and greenhouse gas reduction in real estate.As a part of a research group supported by the Deutsche Forschungsgemeinschaft (DFG) we have an interdisciplinary look at these cities and make use of the Institutional Analysis Framework by Elinor Ostrom (1990) to collect and to aggregate decision-making impacts. Therefore, qualitative as well as quantitative data analyses based on a document analysis and interviews with representatives from the municipalities and the real estate sector are used to model the exogenous constraints of a city as well as the local decision-making arena.There seems to be evidence that cities take into account different efficiency approaches to legitimate their climate protection decisions. First results show that the decision-making process is characterized by an owner-, user-, or producer-oriented real estate management perspective. This fact heavily influences the measures taken, first and foremost the financial impact on the respective stakeholder.This paper categorizes urban strategies to reduce greenhouse gas emissions in the real estate business by identifying influencing factors in the municipal decision-making process. These findings will help to make use of the enormous greenhouse gas reduction potential existing in the metropolitan real estate sector. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_172&r=ene |
| By: | Fuerst, Franz; Oikarinen, Elias |
| Abstract: | This study uses a unique dataset of the Finnish housing market to investigate the hypothesised link between energy efficiency and house prices. It explores the following research questions: 1) Does the energy efficiency rating of a dwelling have an independent impact on its price and if so, how large is the price effect? 2) Does the energy efficiency rating affect the liquidity of housing? 3) Does a high energy efficiency rating always translate into lower maintenance costs (and vice versa)? 4) Has the capitalization of energy efficiency ratings into prices changed during 2006-2012, as the rating system has matured and the awareness of the rating system has grown? 5) Do the lower maintenance costs induced by energy efficiency fully capitalise into house prices? Controlling for a large number of spatial and property characteristics, we find that a low energy efficiency rating affects the price negatively but do not detect a significant premium for higher-rated buildings in most estimations. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_40&r=ene |
| By: | Klug, Siegrun; Geissler, Susanne; Haselsteiner, Edeltraud; Bargehr, Gabriele; Steinbacher, Sabine |
| Abstract: | This contribution presents findings from a qualitative and qualitative user survey carried out in residential and office buildings in 2012 and early 2013. Focus is on user behaviour and consumer aspects in highly energy efficient buildings taking into account societal, social, ethnical, and especially gender-related aspects, and analysing the building design concept in comparison with the actual energy consumption during building operation. The survey tackles the day-to-day life of occupants living or working in highly energy efficient buildings. It reveals the attitude of building users concerning energy efficiency standards and innovative HVAC systems, and serves to analyse the impact of occupants' behaviour on building operation and energy consumption. The development towards plus-energy-buildings (buildings which produce more energy than what occupants consume) causes a change in the role of consumers: consumers turn to active stakeholders, because their way of using the building will be decisive whether the building actually achieves plus-energy status, or not. Therefore there is the need to fully understand the motivations and options for actions of building users, in order to make the new concepts work, such as the concept of plus-energy-building and the concept of smart city as a whole. The user survey is part of the research project 'GINGER – gender aspects in using building, energy and resources' funded by FFG. The study started in July 2012 and will be completed in June 2014. It is based on the deep analysis of new and existing buildings which comply with ambitious energy-related criteria and belong to a broad range of building typologies (multi-unit residential buildings, office buildings, schools and kindergartens, educational campus). The results of the extensive user survey will contribute to improving communication measures, design process and product development in order to meet users needs in a better way. As a consequence, this will improve the energy performance of buildings during operation. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_153&r=ene |
| By: | Kurylchyk, Kateryna; Hill, Daniel; Maier, Gunther |
| Abstract: | This paper presents results from the EU project “Transnational cooperation for the improvement of buildings energy performance and efficiency“(TRACE) which aims to provide a better understanding of reasoning behind scarce investments in energy efficiency in order to improve relevant policies.Due to the complexity and heterogeneity of the real estate market, it is crucial to understand the basic principles of interplay between its different components and stakeholders in the context of energy efficiency in order to create sound policies for enhancing investment in energy efficient buildings. This becomes more important when it comes to implementing policies on a local level and/or in less developed countries. The focus of the study rests therefore upon identifying economic aspects influencing private investments in energy efficient buildings and gaps where policy interventions should be considered in order to encourage such investments. The paper starts with a thorough analysis of the institutional framework of energy efficiency investments. In particular, it elaborates on the links between the real estate market and energy efficiency investments, with a particular focus given to the relationship between key market actors. By approaching the problem from an investor’s point of view, such issues as informational problems, split incentives and prisoner’s dilemma situations are argued inter alia to be critical when considering improvements in energy efficiency investments in buildings. This analysis allows us to identify key factors that may hamper investments into energy efficiency of buildings. At the same time, it makes possible to determine points where local and regional administrations can influence the energy efficiency related investment behaviour of private companies. The paper categorizes such routes for policy intervention and presents which of them are utilized to what extent by local and regional administrations in South-Eastern Europe. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_120&r=ene |
| By: | McLean, Aliz; Horvath, Ã?ron; Kiss, Hubert Janos |
| Abstract: | This paper presents a case study from Hungary on the effect of greater energy efficiency on residential housing prices, using a dataset on real estate transactions. The sample consists of all transactions from 2003 to mid-2012 in a treatment and a control group in Budapest's third district.The paper uses a difference-in-differences framework to test whether prices in a large block of flats - the largest in Hungary - which underwent major energy-efficiency related renovation developed differently following the renovation than prices in comparable, neighbouring blocks. Our results show that the renovation resulted in prices 9.42% higher than they would have been absent the renovation, which amounts to over 1 million Hungarian forints on the average flat. This can be contrasted with around 70 thousand forints in yearly energy savings and the 1.3 million forint cost of the renovation per flat. The latter implies that outside funding may also be required to make investment into energy-efficient renovation worthwhile. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_117&r=ene |
| By: | Bartekova E. (UNU-MERIT) |
| Abstract: | The aim of this paper is to examine the supply risk of rare earths and its impact on low carbon technologies deployment. Bringing together seemingly disconnected strands of scientific literature, this multidisciplinary approach allows to provide an overarching overview of the economics of rare earths. In terms of supply risk, as opposed to the common belief, it is not Chinas dominant position per se, but its industrial policies which distort the rare earths market. On the demand side, the results of this paper disprove the widespread allegation that availability risk impedes deployment of offshore wind. Contrary to this, a potential supply shortage of rare earths would disrupt the further development of the automotive industry and its electrification. Ultimately, uncertainty about volatile prices and threat of supply shortages induce manufacturers to shift away from technologies containing rare earths, and thus render innovation in these economically nonviable. |
| Keywords: | Production, Pricing, and Market Structure; Size Distribution of Firms; Mining, Extraction, and Refining: Other Nonrenewable Resources; Innovation and Invention: Processes and Incentives; Nonrenewable Resources and Conservation: Demand and Supply; Nonrenewable Resources and Conservation: Issues in International Trade; Alternative Energy Sources; Air Pollution; Water Pollution; Noise; Hazardous Waste; Solid Waste; Recycling; |
| JEL: | L11 L72 O31 Q31 Q37 Q42 Q53 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2014043&r=ene |
| By: | Mouez Fodha (University Paris 1 and Paris School of Economics. Maison des Sciences Economiques); Thomas Seegmuller (Aix-Marseille University (Aix-Marseille School of Economics), CNRS-GREQAM & EHESS); Hiroaki Yamagami (Seikei University, Tokyo) |
| Abstract: | This article analyzes the consequences of environmental tax policies when the government imposes a constraint on stabilizing public debt. A public sector of pollution abatement is financed by taxation and by issuing public debt. Considering a simple overlapping-generations model, the tax reform stimulates steady-state investment. Then, the environmental quality and the aggregate consumption increase if and only if (i) pollution abatement is large enough and (ii) there is under-accumulation of the per capita capital stock. This arises if environmental taxation allows a decrease of either income taxation or debt-output ratio. |
| Keywords: | environmental tax reform, debt, public emission abatement, double dividend |
| JEL: | Q5 H23 H63 |
| Date: | 2014–06 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1431&r=ene |
| By: | Grover, Richard; Ledkov, Gregory; Soloviev, Mikhail |
| Abstract: | Purpose - The article discusses the issues involved in reconciling the development of natural resources with traditional uses of land, such as nomadic reindeer herding and fishing. Whilst it is in the national interest to exploit the oil-gas reserves the indigenous population cannot be protected by usual methods of compensation. It raises complex questions of whether the destruction of indigenous livelihoods and cultures can be avoided and whether and what ways the traditional users of the land can protect their interests through sharing in the benefits from natural resource development. Design/methodology/approach - The article uses a case study of Yamal-Nenets Autonomic Okrug undertaken by G Ledkov and examples from other Northern regions. Findings - There has been significant disruption of environment quality and indigenous livelihoods.Practical implications - The leading oil-gas companies developing the industry and infrastructure, are aware of the environmental and social impact of their operations and have sought to mitigate these through engineering solutions and by sponsoring cultural event in similar ways to those used by oil and mining companies elsewhere.Social implications - The Nenets' (and similar indigenous peoples') survival as a distinct culture is bound up with their traditional livelihoods and the natural environment. Originality/value - G Ledkov's perspective as the Duma member for the region gives this article a unique insight into the negotiation process in a situation of asymmetrical power. The results can be used for other Northern regions indigenous population. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_143&r=ene |
| By: | Sahk, Kaarel; Randoja, Taavi |
| Abstract: | During the last decade, especially after the finance and real estate markets shocks, the new attributes, those are able to bear the revaluated expectations of market participants, are strongly needed. The birth of these components, describing the contemporary value estimating procedure is beside the traditional aggregates of value, the aggregates that arise from overall term of sustainability. In the English language societies a prevailing to whales of sustainability parameters constructing: the LEED, furnishing the US and linked with him real estate markets and the BREAAM that is serving as sustainability equipment for GB and influenced by him countries. The development of real estate appraisal in small economy like Estonia and all the Baltic states are spotlights the opposite and diametrical constitutions – on the one hand, the general by nature international foundation is needed, on the other hand, the singularity of Baltic markets must be taken into account. In this case the energy efficiency, primarily grounded on the opened energy market actions, has created a situation whereby without accounting it is not available to compose the at least long term development schedules or to finance them trough the property based mortgages, while the energy efficiency is not estimated. The questionary explains how the different market professionals are using the energy efficiency as a tool for contemporary value approach and do this rapprochement to sustainability through energy efficiency is satisfying them. Of course the responses are able to apply for conclusions according all the Baltic market with relevant reckoning specialities characterising their development differences. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_320&r=ene |
| By: | Geissler, Susanne |
| Abstract: | Sustainability assessments of buildings are well known to result in certificates, which are mainly used for marketing purposes. This conference contribution does not tackle the marketing perspective but focuses on the sustainability assessment of buildings as a risk management tool for corporate real estate management. Buildings have a long life span, and it is important to ensure a stable performance of the property during several decades. Regarding market demand, the building location is undoubtedly a very high ranked criterion when it comes to making the decision to buy or rent a building or building unit or not. Nevertheless, building specific quality characteristics such as energy efficiency characteristics related with the building envelope and the HVAC system, characteristics related with the indoor air quality, and quality characteristics from the facility management perspective to reduce running cost have been gaining in importance, due to the following exemplary reasons: (1) Energy: Even if clients seldom demand for energy efficiency, this topic is definitely on the rise due the legal framework conditions such as the EPBD (Energy Performance of Buildings Directive) and the EED (Energy Efficiency Directive); if a building is not fit to be able to comply with the requirements to come, upgrading might be more expensive than taking energy efficiency into account from the beginning. (2) Indoor climate: Productivity depends on social aspects, but also on building related aspects such as air quality, summer and winter comfort, quality of light, and noise level; this area is more a subject of competition on the market than energy, because of the impact on people's health and productivity. (3) Materials: The type of façade and choice of materials in general has a strong influence on running costs; a wise choice results in a reduction of cleaning costs. All these aspects are finally cost-related factors, which might affect the saleability of a property. Building assessment schemes provide a full range of decision-making criteria to consider all building related aspects, which are already on the rise or might become important in the near future. However, it is the responsibility of the informed expert to decide between options. This conference contribution uses the Austrian sustainable building assessment scheme (ÖGNB – ASBC) to demonstrate the relation between building assessment criteria and risk factors. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_229&r=ene |
| By: | Braun, Thomas; Cajias, Marcelo; Bienert, Sven |
| Abstract: | As the real estate industry is responsible for about 40% of the economy's end energy consumption, its potential to contribute to a sustainable development is accordingly high. In terms of climate change mitigation, the response of the property sector is apparent by the diffusion of green buildings. Considering green buildings as a new product in the real estate market, it is necessary to analyze its diffusion pattern in order to conclude from aggregated data to the actors' behavior behind several stages of adoption. By now, the focus of the green building diffusion literature lies more on the temporal than on the spatial dimension. However, the popular quotation 'labeled properties = prime properties', as one might assume a CSR and image driven demand of international institutional investors, has never been analyzed in detail. The question is what leads the players of the real estate industry to adopt the green innovation in their investment decisions in terms of constructing, renting or investing in certain locations. This paper provides evidence of the factors determining the spatial diffusion of green buildings in the US market by gathering real estate and macroeconomic data. Our contribution to research literature is to identify barriers for a politically intended innovation and delivers a basis for future decisions by policy-makers and investors. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_232&r=ene |
| By: | van de Wetering, Jorn |
| Abstract: | Many studies have sought to establish the direct financial impacts of ecolabels on properties, however, it has also been proposed that the impacts of sustainability issues are more likely to manifest themselves through property risk adjustments over time, depending on the sustainability performance of buildings. Accelerated depreciation of buildings with inferior sustainability attributes may lead to new forms of sustainability-related obsolescence.Under the European Energy Performance of Buildings Directive (EPBD), buildings in the UK are assessed using energy labels (EPCs and DECs), thus providing the property market with signals regarding the energy performance of buildings. The Energy Act 2011 will make it unlawful for private landlords to rent out residential or business premises that do not achieve minimum energy efficiency standards and these will most likely include those that achieve EPC F and G ratings. This legislation is likely to impact on a significant number of buildings.Building on existing theories that investigate the impacts of ecolabels on property values, this study investigates sustainability-related risks that properties in the UK are exposed to. The study will provide a theoretical basis for the impacts that key sustainability drivers are likely to have on the property industry. It will then assess various types of building sustainability risks. Finally, the study will explore which types of properties will be most strongly affected by these risks.The results of this study provide further insights into the scope of sustainability risk-related challenges that properties may face in the future and how such risks can be identified and managed. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_209&r=ene |
| By: | Glynn, Peter James; Taplin, Roslyn |
| Abstract: | Climate change will have a considerable impact on the constructed environment. More specifically, policies and regulations made will impact on construction labour and have future implications for the delivery of climate adaptive property. This paper will examine the implications of climate change policy for the constructed environment labour market. It discusses whether policymakers and regulators are sufficiently informed and aware to accommodate the requirements of a low carbon workplace and whether the actors in the workplace can effectively implement the technical, regulatory and social reforms. The paper concludes that the current initiatives are individually suitable but government models are generally incomplete, lack cohesion and so do not deliver to the extent required by industry or the workplace actors. Recent studies find that there are changes occurring in the labour market as a consequence of climate change (GHK Consulting 2007; ETUC, 2007; Worldwatch Institute, 2008). They also find that skills shortages are a binding constraint on the sector, and that it will continue to be difficult to source workers in the number and with the skills required. These changes are a reflection of the industry’s moves to adapt to the new conditions, and the scaling up required to undertake the work that will reduce the energy consumed and the volume of emissions for which the constructed environment is responsible. Employers’ organisations and trade unions play an active role in the provision of sector and labour market information to policy makers, advocating the collective interests of their constituents who otherwise do not have the opportunity for input on policy and regulatory matters. They also serve as the interface between business and labour interests, and policy makers and regulators. Employers’ organisations and trade unions responsibilities include labour relations and social dialogue in respect of climate change. The paper finds these objectives overlap in some areas and therefore create the potential to infringe regulatory jurisdictions. Diligence is necessary to ensure that labour and management can remain focused on the delivery of goods and services, while also undertaking the measures necessary to adapt to the requirements of a low carbon economy. The constructed environment: is a major contributor to economic growth and employment, providing 10% of global gross domestic product and employing 5-10% of total employment. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_304&r=ene |
| By: | Henger, Ralph |
| Abstract: | Two-third of the residential building stock in Germany is older than 35 years and bears a lot of potential for energy savings. The German Federal Government has therefore committed itself to reduce the primary energy in the building sector down to 80 percent by 2050. This ambitious target requires doubling the energetic building refurbishment rate from its current 1-percent level of the building stock per year. The national strategy basically contains two key elements: stronger building requirements and subsidies on bulding refurbishment. This paper analyses how these programs affect the incentives and the profitability of retrofit investments and discusses the main drivers and barriers that affect the investment decisions made by the owners and landlords. Based on several datasets we show how initial returns depend on influencing factors like saving measure, renovation scope, building type, building age, housing conditions, rents and market situation. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_267&r=ene |
| By: | Surmann, Markus; Brunauer, Wolfgang; Bienert, Sven |
| Abstract: | Properties with outstanding green features and their potential influence on increasing rents and values in the market place associated with higher economic performance on investments have been investigated on a global scale in the past. As a result the upside of green credentials is well understood and has been proved by various empirical studies. However, the competitive advantage of sustainable buildings affecting the building stock and therefore the contrary effect has not been well investigated based on empirical evidence. It is generally assumed that a potential Sustainability Impairment for the existing building stock with inferior energy efficiency etc. is emerging over time caused by the fact that more and more Green Buildings and the ongoing process of increasing energy efficiency regulation for new construction will lead to a situation where sustainable buildings are market standard and older properties face discounts beyond the regular age-related depreciation. In this light the paper investigates two aspects. First the authors explore if the existence of a negative influence on rents, values and economic performance for less energy efficient existing commercial buildings controlling all other factors, especially the effect of age can be proved for the German property market. Data sets from appraisal-based indices are analyzed to provide evidence. Second we analyze the market dynamics over time and try to answer the questions if grey discounts are increasing continuously while green credentials become more and more common. To answer this question we are looking at different timeframes. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_138&r=ene |
| By: | Gabe, Jeremy; Rehm, Michael |
| Abstract: | Preliminary studies on green multi-tenanted office buildings in the United States, Europe and Australia have widely reported the presence of price premiums for certified green or energy-efficient buildings. When researchers look at sales and rental premiums, it is generally concluded that both are present relative to uncertified office buildings. The scale employed in the vast majority of these studies is the building scale, not individual tenancies. Because of this, an alternative explanation for energy efficiency rental premiums is that they originate in the methodology used to calculate a single rental rate that represents the heterogeneous mix of rents within a single building. To test the robustness of rent premiums in Australia, we self-construct a dataset of lease transaction data covering all NABERS Energy-certified buildings in central Sydney directly from lease contracts. The characteristics of each transaction are placed in a hedonic regression model to explain annual base rent per square metre. We find neither significant premiums for highly rated buildings nor significant discounts for poorly rated buildings, implying that the alternative explanation of green rental premiums arising from the process of calculating a single rent for an entire building has merit. Incentives and net effective rent are also considered, to test if Sydney rents are shadow prices. We conclude that green building price premiums in Sydney are paid by owners, not tenants. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_189&r=ene |
| By: | Kenneth Lee; Eric Brewer; Carson Christiano; Francis Meyo; Edward Miguel; Matthew Podolsky; Javier Rosa; Catherine Wolfram |
| Abstract: | In Sub-Saharan Africa, 600 million people live without electricity. Despite ambitions of governments and donors to invest in rural electrification, decisions about how to extend electricity access are being made in the absence of rigorous evidence. Using a novel dataset of 20,000 geo-tagged structures in rural Western Kenya, we provide descriptive evidence that electrification rates remain very low despite significant investments in grid infrastructure. This pattern holds across time and for both poor and relatively well-off households and businesses. We argue that if governments wish to leverage existing infrastructure and economies of scale, subsidies and new approaches to financing connections are necessary. |
| JEL: | O18 O55 Q01 Q41 |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:20327&r=ene |
| By: | Booij, Gerard |
| Abstract: | As for sustainability, the focus should not only be on new building realization but foremost on existing houses. Renovating houses is more environmentally friendly (e.g. concerning materials and energy usage) and cheaper in the end. In the Netherlands up to about 50% of the existing houses have some kind of sustainable quality like insulation, double glazing or energy reducing installations. The first step in any renovation building project should be to measure and document the quality of the houses in detail. Air quality, ventilation, moisture and condensation in the construction, thermal bridges, heat leakage, energy usage etc. should be measured by e.g. blower door tests, smoke detection tests, infrared imaging, monitoring occupants' behavior and modeling (calculations) in order to investigate each problem in relation to the others. Based upon these measurements causes and solutions of the detected problems should be considered. Solving one isolated aspect, however, will frequently result in increasing other problems. Moreover, from the beginning of the project all building partners should operate as a team in order to be able to realize integrated renovation design. Building Information Management tools are recommended to share information and knowledge during realization by the contractors. All partners should be responsible for the quality of the end result, also after delivery of the project. In renovation projects, detecting and solving current problems should precede the application of new advanced sustainable technology, although it can be done simultaneously. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_218&r=ene |
| By: | Sliczna, Malgorzata G. |
| Abstract: | The policy of European Union is focused mostly on green growth, therefore there is an increasing number of regulations concerning sustainable development. The situation is the same in the matter of life cycle of buildings, where pressure is put on eco-friendly solutions. The purpose of the paper is to describe the green residential real estate market in Wroclaw's county and to characterize its main attributes.The paper closely examines put to use, 'green' residential properties. The research studies statistical and real estate data from government agencies, such as District Inspector of Building Control for Wroclaw's county and Cadastre office of Wroclaw's county. The information gathered allows marking out energy efficient residential buildings and determining their value. The research shows that 'green' residential buildings have just a small share in the real estate market of new buildings. The result of the study indicates that just a few of those buildings were sold by the end of the year 2012. Furthermore almost all of 'green' houses were constructed by their owners. An interest in energy efficiency can be the result of the increased willingness to reduce the operating costs of the property. By analyzing the information gathered, the most popular eco-friendly solutions used in buildings (such as: solar panels, heat pumps, biomass boilers) were identified. The research estimates the actual value of 'green' buildings. One of the research limitations was the quality of Energy Performance Certificates (EPC). Even if the EPC was done according to the national approach it may give misleading information about energy efficiency of the building. In the future a further research on the effectiveness and correctness of EPC is necessary. The paper is unique in the field of real estate in Poland as it concentrates on the residential real estate in regards to sustainable development. The results of the research can be useful to valuers and investors since it gives genuine data on the green residential buildings market in Wroclaw's county. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_86&r=ene |
| By: | Natacha Raffin (Université Paris Ouest Nanterre la Défense EconomiX); Thomas Seegmuller (Aix-Marseille University (Aix-Marseille School of Economics), CNRS-GREQAM & EHESS) |
| Abstract: | This paper presents an overlapping generations model where pollution, private and public healths are all determinants of longevity. Public expenditure, financed through labour taxation, provide both public health and abatement. We study the complementarity between the three components of longevity on welfare and economic stability. At the steady state, we show that an appropriate fiscal policy may enhance welfare. However, when pollution is heavily harmful for longevity, the economy might experience aggregate instability or endogenous cycles. Nonetheless, a fiscal policy, which raises the share of public spending devoted to health, may display stabilizing virtues and rule out cycles. This allows us to recommend the design of the public policy that may comply with the dynamic and welfare objectives. |
| Keywords: | longevity, Pollution, welfare, complex dynamics |
| JEL: | J10 O40 Q56 C62 |
| Date: | 2014–07–16 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1433&r=ene |
| By: | Braun, Thomas; Cajias, Marcelo; Bienert, Sven |
| Abstract: | In terms of climate change mitigation, the response of the property sector is apparent by the diffusion of green buildings. Hence, it is necessary to analyse its diffusion pattern in order to identify the current stage of adoption. By now, the focus of the green building diffusion literature lies more on the temporal than on the spatial dimension. As one might assume a CSR and image driven demand of international institutional investors for green buildings, this paper contributes to answering the question, if certificates exclusively are a product for prime locations. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_204&r=ene |
| By: | Laitala, Ari; Viitanen, Kauko |
| Abstract: | Purpose - One suggestion of the Efficient Market Hypothesis (EMH) is that efficient market maximizes the value accumulation of market players. Based on the literature review, framework and prerequisites for the value maximization in efficient real estate market is constructed. This framework is preliminary tested by the case study exploiting focus group discussions. Purpose of the paper is to clarify how market efficiency and value maximization are interwoven.Design/methodology/approach - Hypothesis development is based on the literature review focusing on areas of market efficiency and value theory. In the empirical part study employs the focus group method.Findings - Based on the literal part it can be shown that informational efficient market makes the value maximization possible. On the other hand, value maximization is a driver for the efficient market behavior. Empirical results indicate that suggested framework for the value maximization seems to have a real life relevancy.Research limitations/implications: Due to a nature of the research methodology, empirical validation of the developed framework has an indicative value at this point.Originality/value - In this paper EMH and value theory are brought together. It is shown how they are linked on each other. Nature of the EMH is broadened by the concepts of subjective and objective value. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_225&r=ene |
| By: | Botis, Andrei |
| Abstract: | The interest in green building solutions including materials, products, technology and services has improved significantly all over the world in the past years.A green building can be any project that is built or renovated with due concern for minimizing the full environmental impact of its design, construction/renovation, operations and (possible) de-construction. Key findings for green buildings:• Construction Costs• Building Value• Operational Costs• Health and Productivity• Risk Mitigation Construction CostResearch shows that building green does not necessarily need to cost more, particularly when cost strategies, program management and environmental strategies are integrated into the development process right from the start. Overall trend towards the reduction in design and construction costs associated with green building as building codes around the world become stricter, supply chains for green materials and technologies mature and the industry becomes more skilled at delivering green buildings.Building ValueEvidence from studies carried out over the past decade, primarily based on data gathered from certified office buildings in the United States and UK, has shown that green buildings tend to have higher asset values than their conventional code-compliant counterparts within a range of 9%-13%:•Higher rental/lease rates•Higher occupancy rates•Lower operating expenses•Lower yieldsIn the study of NABERS - rated buildings in Australia, it is important to note that while the higher levels of performance (NABERS 5*) tended to achieve a sales premium of up to 21%. A building in Romania has been sold to an international investment fund at 7.5% yield comparing with the prime office market , which is situated around 8.0 %. Operational CostGreen buildings have been proven to save money through reduced energy and water use and lower long-term operations and lower maintenance costs. High-performing green buildings need to be backed up by robust commissioning, effective management, leadership and communication in order to achieve their predicted performance.HealthGreen design attributes of buildings and indoor and outdoor equipments can improve worker productivity and occupant health and well being and stress reducing.Risk MitigationRisk factors can significantly affect the rental income and the future value of real estate, affecting their return on investment. Investor risk relates to the potential reduction in value. |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2014_237&r=ene |
| By: | Vimpari, Jussi; Junnila, Seppo |
| Abstract: | It seems that there is not a clear consensus among industry professionals on how green certificates should be valued, even though, there seems to be a consensus that certified properties are potentially valued higher than non-certified properties. This study aims to find out whether the potential extra value of a green certificate could be measured with real option valuation (ROV). Data was gathered from industry professionals using a standard discounted cash flow valuation method constructed in a spreadsheet. ROV was applied in the data using Collan's pay-off method. The results show that an average real option value of 985,000 Euro (or 8.8% premium to the average property value) was found for the green certificate. The main finding is that by examining the certificate as a real option, the potential extra value of a green certificate could be added into min and max case scenarios, thus, making it not necessary to alter the normal cash-flow scenario that should be based on the comparable data available from the market which is scarcely available for certified buildings. |
| Date: | 2013 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2013_198&r=ene |
| By: | Escobar D.; Cadena-Gaitán C.; Garcia F. (UNU-MERIT) |
| Abstract: | We apply geo-statistical techniques to find relationships between the geographic location of urban Gas Stations GS and operational features offered by the transport network in Manizales Colombia. This research is built upon primary information collected during a period longer than one year using GPS more than 18 million data points. The methodology consists of i The set-up of the entire urban transport infrastructure network, ii The calculation of the average operating speeds in the links, iii The calculation of the global average accessibility offered by the infrastructure network in different transport modes, iv The calculation of the Spatial Coverage Index, area, population and number of houses covered by the curves of travel time. Graphical results explain the average times invested in reaching a particular GS, and quantitative comparisons between different types of stations are studied. Thus, we establish which sectors of the city are deficient in coverage of this type of activity. The overall results reveal the possibility of reaching a GS in Manizales in an average travel time between 4 and 22 min. |
| Keywords: | Other Production and Pricing Analysis; Transportation: Demand, Supply, and Congestion; Safety and Accidents; Transportation Noise; |
| JEL: | R32 R41 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:unm:unumer:2014048&r=ene |