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on Energy Economics |
| By: | Aldy, Joseph E. (Harvard University) |
| Abstract: | Inadequate policy surveillance has undermined the effectiveness of multilateral climate agreements. To illustrate an alternative approach to transparency, I evaluate policy surveillance under the 2009 G-20 fossil fuel subsidies agreement. The Leaders of the Group of 20 nations tasked their energy and finance ministers to identify and phase-out fossil fuel subsidies. The G-20 leaders agreed to submit their subsidy reform strategies to peer review and to independent expert review conducted by international organizations. This process of developed and developing countries pledging to pursue the same policy objective, designing and publicizing implementation plans, and subjecting plans and performance to review by international organizations differs considerably from the historic approach under the UN Framework Convention on Climate Change. This paper draws lessons from the fossil fuel subsidies agreement for climate policy surveillance. |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp15-029&r=all |
| By: | J. Scott Holladay (Department of Economics, University of Tennessee); Jacob LaRiviere (Department of Economics, University of Tennessee) |
| Abstract: | We use quasi-experimental variation due to the introduction of fracking to estimate the impact of a decrease in natural gas prices on marginal air pollution emissions from electricity producers. We find natural gas generation has displaced coal fired generation as the marginal fuel source signicantly changing the marginal emissions prole. The impact of cheap natural gas varies across U.S. regions as a function of the existing stock of electricity generation. We demonstrate the impact of these changes on the environmental benets of energy policy by simulating the installation wind and solar generating capacity in dierent regions around the U.S. We construct an hourly data set of potential renewable generation for both wind and solar power and combine that with our estimated marginal emissions. CO2 emissions offset by wind and solar power have fallen over most, but not all of the country due to cheap natural gas. |
| Keywords: | energy, air pollution, natural gas, renewable energy |
| JEL: | E32 R10 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:ten:wpaper:2015-07&r=all |
| By: | Lin Zhao (University of Amsterdam, the Netherlands); Sweder van Wijnbergen (University of Amsterdam, the Netherlands) |
| Abstract: | We investigate the relationship between the gas spot market and the price of gas storage capacity. Contrary to the common belief, the auction prices for gas storage are mostly affected by the volatility of current market prices rather than by the winter-summer price differences. This paper provides a numerical solution for pricing storage capacity, by taking investor's activities through the spot market and storage service into account. A bivariate Generalized Autoregressive Score (GAS) model is employed for modeling the dynamics of the day-ahead and month-ahead spot market prices, as well as the time-varying volatilities and correlations. Under an incomplete market setting, our model is able to approximate the realized auction prices. Moreover, one interesting implication is that the implied average risk aversion of investor for a storage contract increases with the volatility of the spot market. This is an intuitive result because storage capacity can serve as an effective hedging product for the spot market, and the demand for this product is high when the market becomes risky: more risk averse investors are participating in the auctions. Moreover, a sensitivity analysis on different injection/withdrawal rates is also included, and particularly, contracts with higher capacity rates are priced at a higher level. |
| Keywords: | stochastic volatility; Generalised Autoregressive Score modeling; incomplete markets; real options; utility indifference pricing; gas storage; capacity constraints |
| JEL: | C61 C63 G12 G13 Q41 |
| Date: | 2015–08–28 |
| URL: | http://d.repec.org/n?u=RePEc:tin:wpaper:20150104&r=all |
| By: | Peter Silanic (Department of Economic Policy, University of Economics in Bratislava); Alzbeta Siskovicova |
| Abstract: | The paper is focused on the questions of regulation and natural monopolies. We intend to explain basic problems in this area of study, address different methods of regulation and describe their advantages and disadvantages. Furthermore the paper will focus on the sector of the Slovak economy which is subject to this form of regulation – the gas industry. We will explain the method of regulation used in this industry and describe its vertical structure and the development of different levels of the vertical chain. The final chapter will attempt to evaluate the effectiveness of the functioning of the regulation in the gas sector in Slovakia. |
| Keywords: | regulation, efficiency, natural monopolies, gas industry |
| JEL: | L51 L52 |
| Date: | 2014–12–28 |
| URL: | http://d.repec.org/n?u=RePEc:brt:wpaper:010&r=all |
| By: | Massimiliano Caporin (University of Padova); Fulvio Fontini (University of Padova) |
| Abstract: | The gas extraction technological developments of the 2000s have allowed shale gas production, which in the US has become a significant part of the total gas production. Such a significant change might have affected the long-run relationship between oil and natural gas prices postulated by several authors. By using monthly data of oil and gas prices, as well as gas quantities from 1997 to 2013, we test for the presence of a long-run relationship, allowing also for possible breaks. We first show the stationarity of gas quantity data before the production of shale gas and the existence of a break in the trend (and in the the intercept) on the integrated gas price time series, by the time shale gas enters the market. Then, applying a Vector Error Correction Model, we show that shale gas production has affected the relationship across variables. Gas quantities become relevant in the formation of gas prices after the beginning of shale gas production, while impact of oil prices on the gas ones doubles. However, on the basis of the available data, it is not unequivocally possible to assess whether or not a new long-run relationship between oil and gas has been established. |
| Keywords: | Shale Gas, Natural Gas, Crude Oil, Cointegration, Vector Error Correction Models. |
| JEL: | C01 C32 Q40 Q41 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:pad:wpaper:0198&r=all |
| By: | Ben Hunt; Dirk Muir; Martin Sommer |
| Abstract: | This paper uses two of the IMF's structural macroeconomic models to estimate the potential global impact of the boom in unconventional oil and natural gas in the United States. The results suggest that the impact on the level of U.S. real GDP over roughly the next decade could be significant, but modest, ranging between 1 and 1½ percent. Further, while the impact on the U.S. energy trade balance will be large, most results suggest that its impact on the overall U.S. current account will be negligible. The impact outside of the United States will be modestly positive on average, but most countries dependent on energy exports will be affected adversely. |
| Keywords: | Energy prices;Demand for money;Monetary policy;United States;business cycle, energy consumption, general equilibrium models, macroeconomic interdependence, oil shocks, policy, energy, oil, gas, energy production, price, Computable and Other Applied General Equilibrium Models, Forecasting and Simulation, Forecasting and Simulation, Forecasting and Simulation, Energy and the Macroeconomy, |
| Date: | 2015–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:15/92&r=all |
| By: | Oskar Lecuyer (Department of Economics and Oeschger Centre for Climate Change Research - University of Bern); Adrien Vogt-Schilb (CIRED - Centre International de Recherche sur l'Environnement et le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - CIRAD - Centre de coopération internationale en recherche agronomique pour le développement - École des Ponts ParisTech (ENPC) - CNRS, Climate Change Group - The World Bank) |
| Abstract: | This paper studies the optimal transition from existing coal power plants to gas and renewable power under a carbon budget. It solves a model of polluting, exhaustible resources with capacity constraints and adjustment costs (to build coal, gas, and renewable power plants). It finds that optimal investment in renewable energy may start before coal power has been phased out and even before investment in gas has started, because doing so allows for smoothing investment over time and reduces adjustment costs. Gas plants may be used to reduce short-term investment in renewable power and associated costs, but must eventually be phased out to allow room for carbon-free power. One risk for myopic agents comparing gas and renewable investment is thus to overestimate the lifetime of gas plants - e.g., when computing the levelized cost of electricity - and be biased against renewable power. These analytical results are quantified with numerical simulations of the European Commission's 2050 energy roadmap. |
| Date: | 2014–08–21 |
| URL: | http://d.repec.org/n?u=RePEc:hal:ciredw:hal-01057241&r=all |
| By: | Syed Abul, Basher; Andrea, Masini; Sam, Aflaki |
| Abstract: | Confronted by increasingly tight budgets and a broad range of alternative options, policy makers need empirical methods to evaluate the effectiveness of policies aimed at supporting the diffusion of renewable energy sources (RES). Rigorous empirical studies of renewable energy policy effectiveness have typically relied on panel data models to identify the most effective mechanisms. A common characteristic of some of these studies, which has important econometric implications, is that they assume that the contribution of RES to total electricity generation will be stationary around a mean. This paper reviews such assumptions and rigorously tests the time series properties of the contribution of RES in the energy mix for the presence of a unit root. To that end, we use both individual and panel unit root tests to determine whether the series exhibit non-stationary behavior at the country level as well as for the panel as a whole. The analysis, applied to a panel of 19 OECD countries over the period 1990–2012, provides strong evidence that the time series of the renewable share of electricity output are not stationary in 17 of the 19 countries examined. This finding has important implications for energy policy assessment and energy policy making, which are discussed in the paper. |
| Keywords: | Renewable energy policies, renewable energy diffusion, unit root, cross-sectional dependence. |
| JEL: | C22 C23 Q28 |
| Date: | 2015–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66389&r=all |
| By: | K. G. H. Baldwin (The Energy Change Institute, The Australian National University); Bruce Chapman (Crawford School of Public Policy, The Australian National University); Umbu Raya (Crawford School of Public Policy, The Australian National University) |
| Abstract: | Rooftop solar systems have two major benefits: a reduction of carbon emissions (a public good) and future energy bill savings for consumers. However, the availability of solar energy systems to low-income households is constrained by access to finance for the initial investment cost, an issue which could potentially be addressed with the use of income contingent loans (ICLs). By applying unconditional quantile econometric methods to HILDA income data we illustrate that for a $10,000 loan for home owners ICLs can be used with little or no cost to government to help finance the next one million solar energy devices. |
| Keywords: | income contingent loans; solar energy |
| JEL: | Q28 Q27 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:een:ccepwp:1508&r=all |
| By: | Richard Audoly (CIRED - Centre International de Recherche sur l'Environnement et le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - CIRAD - Centre de coopération internationale en recherche agronomique pour le développement - École des Ponts ParisTech (ENPC) - CNRS); Adrien Vogt-Schilb (The World Bank - The World Bank, CIRED - Centre International de Recherche sur l'Environnement et le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - CIRAD - Centre de coopération internationale en recherche agronomique pour le développement - École des Ponts ParisTech (ENPC) - CNRS); Céline Guivarch (CIRED - Centre International de Recherche sur l'Environnement et le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - CIRAD - Centre de coopération internationale en recherche agronomique pour le développement - École des Ponts ParisTech (ENPC) - CNRS) |
| Abstract: | This paper covers three policy-relevant aspects of the carbon content of elec-tricity that are well established among integrated assessment models but under-discussed in the policy debate. First, climate stabilization at any level from 2 • C to 3 • C requires electricity to be almost carbon-free by the end of the century. As such, the question for policy makers is not whether to decarbonize electricity but when to do it. Second, decarbonization of electricity is still possible and required if some of the key zero-carbon technologies — such as nuclear power or carbon capture and storage — turn out to be unavailable. Third, progres-sive decarbonization of electricity is part of every country's cost-effective means of contributing to climate stabilization. In addition, this paper provides cost-effective pathways of the carbon content of electricity — computed from the results of AMPERE, a recent integrated assessment model comparison study. These pathways may be used to benchmark existing decarbonization targets, such as those set by the European Energy Roadmap or the Clean Power Plan in the United States, or inform new policies in other countries. These pathways can also be used to assess the desirable uptake rates of electrification technolo-gies, such as electric and plug-in hybrid vehicles, electric stoves and heat pumps, or industrial electric furnaces. |
| Date: | 2014–11–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:ciredw:hal-01079837&r=all |
| By: | Gerarden, Todd G. (Harvard University); Newell, Richard G. (Duke University); Stavins, Robert (Harvard University) |
| Abstract: | Energy-efficient technologies offer considerable promise for reducing the financial costs and environmental damages associated with energy use, but these technologies appear not to be adopted by consumers and businesses to the degree that would apparently be justified, even on a purely financial basis. We present two complementary frameworks for understanding this so-called "energy paradox" or "energy-efficiency gap." First, we build on the previous literature by dividing potential explanations for the energy-efficiency gap into three categories: market failures, behavioral anomalies, and model and measurement errors. Second, we posit that it is useful to think in terms of the fundamental elements of cost-minimizing energy-efficiency decisions. This provides a decomposition that organizes thinking around four questions. First, are product offerings and pricing economically efficient? Second, are energy operating costs inefficiently priced and/or understood? Third, are product choices cost-minimizing in present value terms? Fourth, do other costs inhibit more energy-efficient decisions? We review empirical evidence on these questions, with an emphasis on recent advances, and offer suggestions for future research. |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp15-004&r=all |
| By: | Gerarden, Todd G. (Harvard University); Newell, Richard G. (Duke University); Stavins, Robert (Harvard University); Stowe, Robert C. (Harvard University) |
| Abstract: | Improving end-use energy efficiency--that is, the energy-efficiency of individuals, households, and firms as they consume energy--is often cited as an important element in efforts to reduce greenhouse-gas (GHG) emissions. Arguments for improving energy efficiency usually rely on the idea that energy-efficient technologies will save end users money over time and thereby provide low-cost or no-cost options for reducing GHG emissions. However, some research suggests that energy-efficient technologies appear not to be adopted by consumers and businesses to the degree that would seem justified, even on a purely financial basis. We review in this paper the evidence for a range of explanations for this apparent "energy-efficiency gap." We find most explanations are grounded in sound economic theory, but the strength of empirical support for these explanations varies widely. Retrospective program evaluations suggest the cost of GHG abatement varies considerably across different energy-efficiency investments and can diverge substantially from the predictions of prospective models. Findings from research on the energy-efficiency gap could help policy makers generate social and private benefits from accelerating the diffusion of energy-efficient technologies--including reduction of GHG emissions. |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp15-005&r=all |
| By: | Houde, Sebastien (University of MD); Aldy, Joseph E. (Harvard University) |
| Abstract: | The effectiveness of investment subsidies depends on the existing array of regulatory and information mandates, especially in the energy efficiency space. Some consumers respond to information disclosure by purchasing energy-efficient durables (and thus may increase the inframarginal take-up of a subsequent subsidy), while other consumers may locate at the lower bound of a minimum efficiency standard (and a given subsidy may be insufficient to change their investment toward a more energy-efficient option). We investigate the incremental impact of energy efficiency rebates in the context of regulatory and information mandates by evaluating the State Energy Efficient Appliance Rebate Program (SEEARP) implemented through the 2009 American Recovery and Reinvestment Act. The design of the program--Federal funds allocated to states on a per capita basis with significant discretion in state program design and implementation--facilitates our empirical analysis. Using transaction-level data on appliance sales, we show that most program participants were inframarginal due to important short-term intertemporal substitutions where consumers delayed their purchases by a few weeks. We find evidence that some consumers accelerated the replacement of their old appliances by a few years, but overall the impact of the program on long-term energy demand is likely to be very small. Our estimated measures of cost-effectiveness are an order of magnitude higher than estimated for other energy efficiency programs in the literature. We also show that designing subsidies that reflect, in part, underlying attribute-based regulatory mandates can result in perverse effects, such as upgrading to larger, less energy-efficient models. |
| JEL: | H31 Q40 Q48 Q58 |
| Date: | 2014–09 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp14-046&r=all |
| By: | Clemens Rohde (Fraunhofer IAIS - Fraunhofer IAIS); Jan Rosenow (University of Oxford [Oxford]); Nick Eyre (University of Oxford [Oxford]); Louis-Gaëtan Giraudet (CIRED - Centre International de Recherche sur l'Environnement et le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - CIRAD - Centre de coopération internationale en recherche agronomique pour le développement - École des Ponts ParisTech (ENPC) - CNRS) |
| Abstract: | Better leverage of public funding is essential in order to trigger the invest-ment needed for energy efficiency. In times of austerity governments in-creasingly look at policy instruments not funded by public expenditure and Energy Savings Obligations represent one option. Because Energy Savings Obligations are paid for by all energy customers, the degree to which they are able to raise additional private capital for energy efficiency invest-ments is crucial with regard to the financial burden on consumers. In this paper, we systematically assess how successful Energy Savings Obliga-tions were in levering capital from parties other than the obligated entities including private investors and other public bodies. We analyse three countries with substantial experience with Energy Savings Obligations, identify the main design differences and the effect this has on the degree of leverage. We conclude that the design of Energy Savings Obligations largely determines the degree of leverage and that that there appears to be a trade-off between high leverage and additionality. |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01016112&r=all |
| By: | Diaz Anadon, Laura (Harvard University); Bosetti, Valentina (Harvard University); Chan, Gabriel (Harvard University); Nemet, Gregory (Harvard University); Verdolini, Elena (Harvard University) |
| Abstract: | Characterizing the future performance of energy technologies can improve the development of energy policies that have net benefits under a broad set of future conditions. In particular, decisions about public investments in research, development, and demonstration (RD&D) that promote technological change can benefit from (1) an explicit consideration of the uncertainty inherent in the innovation process and (2) a systematic evaluation of the tradeoffs in investment allocations across different technologies. To shed light on these questions, over the past five years several groups in the United States and Europe have conducted expert elicitations and modeled the resulting societal benefits. In this paper, we discuss the lessons learned from the design and implementation of these initiatives in four respects. First, we discuss lessons from the development of ten energy-technology expert elicitation protocols, highlighting the challenge of matching elicitation design with a particular modeling tool. Second, we report insights from the use of expert elicitations to optimize RD&D investment portfolios. These include a discussion of the rate of decreasing marginal returns to research, the optimal level of overall investments, and the sensitivity of results to policy scenarios and selected metrics for evaluation. Third, we discuss the effect of combining online elicitation tools with in-person group discussions on the usefulness of the results. Fourth, we summarize the results of a meta-analysis of elicited data across research groups to identify the association between expert characteristics and elicitation results. |
| Date: | 2014–11 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp14-054&r=all |
| By: | Howell, Sabrina (Harvard University); Lee, Henry (Harvard University); Heal, Adam (Harvard University) |
| Abstract: | China has ambitious goals for developing and deploying electric vehicles (EV). The stated intention is to "leapfrog" the auto industries of other countries and seize the emerging EV market. Since 2009, policies have included generous subsidies for consumers in certain locations, as well as strong pressure on local governments to purchase EVs. Yet four years into the program, progress has fallen far short of the intended targets. China's EV industry faces the same challenges as companies in the West: a) high battery costs; b) inadequate range between charges; and c) no obvious infrastructure model for vehicle charging. In addition, China's industry is constrained by four domestic barriers. Mass EV deployment in China likely requires substantial policy adjustment. In particular, it will be necessary to permit foreign EV technologies relatively free market entry. In turn, this requires greater foreign IP protection. China must also consolidate its domestic industry and place greater emphasis on smaller, cheaper vehicles aimed at domestic, lower-end markets. If EVs are to contribute to air quality improvement, the government must ensure that the electricity powering EVs is cleaner than the current mix, particularly in Northeast regions of China. |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp14-035&r=all |
| By: | Christian Vonbun |
| Abstract: | Este Texto para Discussão (TD) apresenta uma breve revisão da literatura acerca dos custos e benefícios de veículos elétricos e veículos híbridos do tipo plug-in (PHEV), com ênfase em seus benefícios em termos de redução da emissão de gases de efeito estufa e gases nocivos à saúde humana. Conclui-se que os veículos híbridos, ainda que tenham de superar barreiras tecnológicas e culturais, apresentam um grande potencial de elevar não apenas a eficiência energética do setor de transporte, mas também contribuir para aumentar a eficiência e reduzir os custos relacionados à produção de energia elétrica. Esses veículos podem servir de ponte entre os veículos convencionais e os elétricos, quando os desenvolvimentos tecnológicos, notadamente relativos ao custo e à eficiência das baterias permitirem a adoção generalizada de veículos elétricos. Todavia, é importante notar que o aproveitamento pleno do potencial de economia e de redução de emissão de poluentes está condicionado à implantação das chamadas smart grids e, mais importante, de como se configura a produção marginal de energia elétrica na região e no período considerados. This paper presents a brief literature review concerning the costs and benefits of electric vehicles and hybrid electric vehicles, highlighting their advantages in terms of greenhouse gas emissions reductions. Even though electric and electro-hybrid vehicles must still overcome many cultural and technological barriers, they present a great potential in improving the energy efficiency of the transportation system, as well as reducing the costs of electric energy production and transmission. The hybrid vehicles may close the technological and operational gap between the old internal combustion powered vehicles and the new electric cars, until new improvements on batteries allow the widespread introduction of electric cars as the standard individual transportation vehicles. Nevertheless, it is imperative to stress that the full potential benefits of these vehicles is conditioned to the implementation of Smart Grids that enable the electric system to use them as a reservoire of energy that provides back up power to the system, to be employed in peak consumption hours. It is also vital to ensure that the required incremental energy production is proportionately cleaner than the internal combustion vehicles they replace. |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:ipe:ipetds:2123&r=all |
| By: | Florian Ziel; Rick Steinert |
| Abstract: | Our paper aims to model and forecast the electricity price in a completely new and promising style. Instead of directly modeling the electricity price as it is usually done in time series or data mining approaches, we model and utilize its true source: the sale and purchase curves of the electricity exchange. We will refer to this new model as X-Model, as almost every deregulated electricity price is simply the result of the intersection of the electricity supply and demand curve at a certain auction. Therefore we show an approach to deal with a tremendous amount of auction data, using a subtle data processing technique as well as dimension reduction and lasso based estimation methods. We incorporate not only several known features, such as seasonal behavior or the impact of other processes like renewable energy, but also completely new elaborated stylized facts of the bidding structure. Our model is able to capture the non-linear behavior of the electricity price, which is especially useful for predicting huge price spikes. Using simulation methods we show how to derive prediction intervals. We describe and show the proposed methods for the day-ahead EPEX spot price of Germany and Austria. |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1509.00372&r=all |
| By: | Dutta, Goutam; Mitra, Krishnendranath |
| Abstract: | In this paper, we survey 82 papers related to revenue management and dynamic pricing of electricity and lists future research avenues in this field. Dynamic pricing has the potential to modify electric load profiles by charging different prices at different demand levels and hence can act as an effective demand side management tool. There are different forms of dynamic prices that can be offered to different markets and customers. Forecasting of demand, and demand price relationship play an important role in determining prices and helps in scheduling load in dynamic pricing environments. Consumers’ willingness-to-pay for electricity services is also necessary in setting price limits. Elasticity of demand is an indication of the demand response to changing prices. Market segmentation can enhance the effects of such pricing schemes. Appropriate scheduling of electrical load enhances the consumer response to dynamic tariffs. |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:13724&r=all |
| By: | James Bushnell |
| Abstract: | James Bushnell examines the response of regulators in the United States to apparent abuses by a newly influential segment of the industry: Banks. |
| Date: | 2014–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:vuw:vuwcrt:380102&r=all |
| By: | Mahringer, Steffen; Fuess, Roland; Prokopczuk, Marcel |
| Abstract: | In liberalized electricity wholesale markets, transmission rights valuation and market design have traditionally been closely intertwined. In Europe, where transmission rights are mainly related to cross-border transactions between adjacent markets, the recent roll-out of market coupling mechanisms has even further strengthened this mutual dependence: due to the resulting improved price convergence across coupled markets, spread dynamics have become more intricate and complex to model, which cannot generally be achieved with classic reduced-form approaches commonly used for transmission rights valuation. In this paper, we instead propose a fundamental model for electricity prices in two coupled markets, which adequately reflects the current institutional framework for cross-border trade in Europe. Based on this setting, we analyze in detail how transmission rights can be valued as spread options on the spot prices derived from this framework, and illustrate how related pricing implications compare against the standard Margrabe benchmark. |
| Keywords: | Transmission Rights Valuation, Fundamental Model, Multi-Market Modeling, Derivatives Pricing, Energy Market Coupling |
| JEL: | G12 G13 Q4 Q41 |
| Date: | 2015–06 |
| URL: | http://d.repec.org/n?u=RePEc:usg:sfwpfi:2015:12&r=all |
| By: | Boylan, Richard T. (Rice University) |
| Abstract: | Since the 1990s, American states have deregulated electricity markets. However, there has been little effort to privatize municipal utilities. Rather, after storm related power outages, the press has relayed calls for municipalizing investor owned utilities, and claimed that profit-making utilities do not have enough of an incentive to prepare for storms. Most storm preparedness discussions have focused on regularly cutting tree branches near power lines and burying power lines underground. We provide empirical evidence that municipal utilities spend more on maintenance of their distribution network (e.g., cutting trees), but bury a smaller percent of their lines underground, compared to investor owned utilities. In order to find the overall effect of ownership type on outages, we examine a stratified random sample of 241 investor owned, 96 cooperative, and 94 municipal utilities in the United States between 1999 and 2012. We find that storms disrupt electricity sales for municipal utilities; specifically, storm damages that equal 1% of personal income lead to a 1.85% decrease in residential electricity sales by municipal utilities. However, storms do not significantly affect residential electricity sales by investor owned utilities. These results are consistent with international experience with privatization. Specifically, countries that have privatized distribution have not seen an increase in disruptions to electricity service. |
| JEL: | D70 L33 L94 |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:riceco:14-014&r=all |
| By: | Gonzalez-Gomez, Jorge (?); Hartley, Peter (Rice University) |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:riceco:14-024&r=all |
| By: | Philipp M. Richter (German Institute for Economic Research (DIW Berlin)); Roman Mendelevitch (German Institute for Economic Research (DIW Berlin)); Frank Jotzo (Crawford School of Public Policy, The Australian National University) |
| Abstract: | In this paper we investigate the introduction of an export tax on steam coal levied by an individual country (Australia), or a group of major exporting countries. The policy motivation would be twofold: generating tax revenues against the background of improved terms-of-trade, while CO2 emissions are reduced. We construct and numerically apply a two-level game consisting of an optimal policy problem at the upper level, and an equilibrium model of the international steam coal market (based on COALMOD-World) at the lower level. We find that a unilaterally introduced Australian export tax on steam coal has little impact on global emissions and may be welfare reducing. On the contrary, a tax jointly levied by a Òclimate coalitionÓ of major coal exporters may well leave these better off while significantly reducing global CO2 emissions from steam coal by up to 200 Mt CO2 per year. Comparable production-based tax scenarios consistently yield higher tax revenues but may be hard to implement against the opposition of disproportionally affected local stakeholders depending on low domestic coal prices. |
| Keywords: | Export tax; steam coal; supply-side climate policy; carbon leakage; Australia; Mathematical Program with Equilibrium Constraints (MPEC) |
| JEL: | Q48 F13 Q58 Q41 C61 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:een:ccepwp:1507&r=all |
| By: | NABABAN, TONGAM SIHOL |
| Abstract: | The purpose of the study is to explore and analyze the factors influencing the consumption, elasticity , and intensity of household energy sector in Indonesia. The estimated variables in this research based on energy and economic indicators in the period of 2000 - 2013. To get the better result, the estimation used a model of a logarithm natural in forms of doublelog and linearlog. The estimation of household energy consumption used doublelog model and the estimation of intensity of final energy per capita used linearlog model . The results based on the simple regression analysis show that variables individually : gross domestic product , the number of population, the number of households , and the final energy consumption per capita has positive and significant effect (α = 1 % ) on the energy consumption of households. The number of population and the number of household are the most dominant variables affect the energy consumption of households. It means the more the number of population and households the higher energy consumption of households. Then individually, variables of gross domestic product , the number of population, the number of households, the final energy consumption per capita has positive and significant effect ( α = 1 % ) on the intensity of final energy per capita . The intensity of final energy per capita in the period of 2000 - 2013 continues to rise, which implies that the price or the cost of energy conversion to gross domestic product to be higher and inefficient . During the period of 2000-2013 the value of elasticity of household energy consumption is less than one (e < 1). It means that household sector has been making use of energy with more efficient .Then during the period of 2000 - 2013 the value of intensity of households energy tends to decrease, it shows that the use of energy households to be more efficient . |
| Keywords: | final energy, household sector, elasticity, intensity, gross domestic product |
| JEL: | D1 D12 |
| Date: | 2015–08–13 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66257&r=all |
| By: | P. GIVORD (Insee); C. GRISLAIN-LETRÉMY (Insee); H. NAEGELE (DIW) |
| Abstract: | This paper sets out to identify the impact of fuel prices on new car purchases, using exhaustive individual-level data of monthly registration of new private cars in France from 2003 to 2007. Detailed information on the car holder enables us to account for heterogeneous preferences across purchasers. We identify demand parameters through the large oil price fluctuations of this period. We find that the sensitivity of short-term demand with respect to fuel prices is generally low. Using these estimates, we assess the impact of a policy equalizing diesel and gasoline taxes, assuming that consumers react similarly to fuel price changes from tax and from oil price variations. Such a policy would slightly reduce the share of diesel in new cars purchases in the short-run (i.e. before supply side adjustments take place), without substantially changing the average fuel consumption or CO2 emission levels of new cars. Alternatively, a carbon tax (at 15 ¬/ton of CO2) could slightly decrease these emissions in the short-run. |
| Keywords: | fuel prices, automobiles, carbon dioxide emissions, environmental tax |
| JEL: | C25 D12 H23 L62 Q53 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:crs:wpdeee:g2014-14&r=all |
| By: | Iacono, Roberto |
| Abstract: | This paper contributes to the growing political economy literature of within-country natural resources management, by proposing a new resource policy for the oil-rich southern Italian region of Basilicata. The policy proposal is to establish a (regional) wealth fund in which all the royalty revenues from non-renewable natural resource exploitation in Basilicata would be stored and fully converted into low-risk financial assets. The scope is to give priority to long-run investments as to better exploit revenues from large-scale extraction of natural capital. Establishing a wealth fund at the regional sub-national level is a novel approach that can be applied to other resource-rich regions in the world. I label the fund as the Basilicata Wealth Fund (BWF). The BWF would be a regionally owned investment fund, however independently administered from national authorities (for instance, as an independent legal entity under the jurisdiction of the Bank of Italy). In addition, the paper posits a transparent and clear-cut spending fiscal rule in order to let regional authorities use the resource revenues to finance economic policy. The clear advantage from the BWF would be the stronger focus on long-run economic development and the higher accountability, hence avoiding misuse of resource revenues for myopic fiscal spending. |
| Keywords: | Exhaustible natural resources; Sovereign Wealth Fund; Regional economy; Long-run economic development; Basilicata. |
| JEL: | O13 Q32 R11 R58 |
| Date: | 2015–09–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66393&r=all |
| By: | Aldy, Joseph E. (Harvard University and Resources for the Future) |
| Abstract: | In 2010, the Gulf Coast experienced the largest oil spill, the greatest mobilization of spill response resources, and the first Gulf-wide deepwater drilling moratorium in U.S. history. Taking advantage of the unexpected nature of the spill and drilling moratorium, I estimate the net effects of these events on Gulf Coast employment and wages. Despite predictions of major job losses in Louisiana--resulting from the spill and the drilling moratorium--I find that Louisiana coastal parishes, and oil-intensive parishes in particular, experienced a net increase in employment and wages. In contrast, Gulf Coast Florida counties, especially those south of the Panhandle, experienced a decline in employment. Analysis of accommodation industry employment and wage, business establishment count, sales tax, and commercial air arrival data likewise show positive economic activity impacts in the oil-intensive coastal parishes of Louisiana and reduced economic activity along the Non-Panhandle Florida Gulf Coast. |
| JEL: | J30 J64 Q40 |
| Date: | 2014–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp14-037&r=all |
| By: | Mehmet Balcilar (Department of Economics, Eastern Mediterranean University, Famagusta, Northern Cyprus , via Mersin 10, Turkey; Department of Economics, University of Pretoria, Pretoria, 0002, South Africa); Reneé van Eyden (Department of Economics, University of Pretoria); Josine Uwilingiye (Department of Economics, University of Pretoria); Rangan Gupta (Department of Economics, University of Pretoria) |
| Abstract: | One characteristic of many macroeconomic and financial time series is their asymmetric behaviour during different phases of a business cycle. Oil price shocks have been amongst those economic variables that have been identified in theoretical and empirical literature to predict the phases of business cycles. However, the role of oil price shocks to determine business cycle fluctuations has received less attention in emerging and developing economies. The aim of this study is to investigate the role of oil price shocks in predicting the phases of the South African business cycle associated with higher and lower growth regimes. By adopting a regime dependent analysis, we investigate the impact of oil price shocks under two phases of the business cycle, namely high and low growth regimes. As a net importer of oil, South Africa is expected to be vulnerable to oil price shocks irrespective of the phase of the business cycle. Using a Bayesian Markov switching vector autoregressive (MS-VAR) model and data for the period 1960Q2 to 2013Q3, we found the oil price to have predictive content for real output growth under the low growth regime. The results also show the low growth state to be shorter-lived compared to the higher growth state. against standard forecasting models. U.S. inflation forecasts improve when controlling for persistence and economic policy uncertainty (EPU). Importantly, the VARFIMA model, comprising of inflation and EPU, outperforms commonly used inflation forecast models. |
| Keywords: | Macroeconomic fluctuations; oil price shocks; Bayesian Markov switching VAR; |
| JEL: | C32 E32 Q43 |
| Date: | 2014 |
| URL: | http://d.repec.org/n?u=RePEc:emu:wpaper:15-13.pdf&r=all |
| By: | Guta, Dawit; Jara, Jose; Adhikari, Narayan; Qiu, Chen; Gaur, Varun; Mirzabaev, Alisher |
| Abstract: | Access to modern energy is vital for sustainable development. In rural areas, decentralized energy solutions may play a significant role in reducing poverty, supporting community institutions and facilitating the generation of basic services such as communication, water access, education and health services. However, the majority of dwellers in off-grid communities in developing countries have little or no access to modern energy technologies, although they are endowed with a vast potential of renewable energy resources. Decentralized energy solutions could serve as an option to solve this energy access problem. However, the previous literature indicates that there are financial, technical, infrastructural, and institutional constraints to scale up decentralized energy options. This paper seeks to study the underlying factors behind the successes and failures of household- and community-based decentralized energy technologies through local case studies from different parts of the world, analyzed through the lenses of the Water-Energy-Food Security (WEF) nexus. First, the paper reviews the literature on the main benchmarks used to evaluate the success and failure of community-based energy. Second, the conceptual framework relating decentralized energy to the WEF nexus elements is briefly described. Thirdly, the methods and data used in the paper are described, followed by the presentation of the case studies. Lastly, the paper is concluded by drawing policy lessons and recommendations. Further empirical studies are recommended to quantitatively evaluate the impacts of decentralized energy solutions on the welfare of households and communities within the framework of the Water-Energy-Food nexus. |
| Keywords: | decentralized energy, Water-Energy-Food Security nexus, Agricultural and Food Policy, Community/Rural/Urban Development, Consumer/Household Economics, Environmental Economics and Policy, Resource /Energy Economics and Policy, O13, Q40, |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ubzefd:207713&r=all |
| By: | Chang, C-L.; Li, Y.; McAleer, M.J. |
| Abstract: | __Abstract__ Energy and agricultural commodities and markets have been examined extensively, albeit separately, for a number of years. In the energy literature, the returns, volatility and volatility spillovers (namely, the delayed effect of a returns shock in one asset on the subsequent volatility or covolatility in another asset), among alternative energy commodities, such as oil, gasoline and ethanol across different markets, have been analysed using a variety of univariate and multivariate models, estimation techniques, data sets, and time frequencies. A similar comment applies to the separate theoretical and empirical analysis of a wide range of agricultural commodities and markets. Given the recent interest and emphasis in bio-fuels and green energy, especially bio-ethanol, which is derived from a range of agricultural products, it is not surprising that there is a topical and developing literature on the spillovers between energy and agricultural markets. Modelling and testing spillovers between the energy and agricultural markets has typically been based on estimating multivariate conditional volatility models, specifically the BEKK and DCC models. A serious technical deficiency is that the Quasi-Maximum Likelihood Estimates (QMLE) of a full BEKK matrix, which is typically estimated in examining volatility spillover effects, has no asymptotic properties, except by assumption, so that no statistical test of volatility spillovers is possible. Some papers in the literature have used the DCC model to test for volatility spillovers. However, it is well known in the financial econometrics literature that the DCC model has no regularity conditions, and that the QMLE of the parameters of DCC has no asymptotic properties, so that there is no valid statistical testing of volatility spillovers. The purpose of the paper is to evaluate the theory and practice in testing for volatility spillovers between energy and agricultural markets using the multivariate BEKK and DCC models, and to make recommendations as to how such spillovers might be tested using valid statistical techniques. Three new definitions of volatility and covolatility spillovers are given, and the different models used in empirical applications are evaluated in terms of the new definitions and statistical criteria. |
| Keywords: | Energy markets, agricultural markets, volatility and covolatility spillovers, univariate and multivariate conditional volatility models, BEKK, DCC, definitions of spillovers |
| JEL: | C22 C32 C58 G32 O10 Q42 |
| Date: | 2015–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:ems:eureir:78349&r=all |
| By: | Rensfeldt, Arvid; Pariyawong, Vorapat; Fujii, Hidemichi |
| Abstract: | This study investigates and compares the financial and environmental performance development of two major car manufacturing companies, Volvo Car Corporation and Hondo Motor Corporation, over the last decade. These two companies consist of one with close historical ties and most of its business in Asia and one mainly located in Europe but that is in the process of expanding production in the Asian region. Using data mainly from corporate reports to perform a decomposition analysis, it is shown that these companies have both undertaken measures to decrease their environmental impacts but in different manners and that Volvo Car Corporation has been more successful in lowering its emissions of greenhouse gas (GHG) over the studied period. The difference in the strategies chosen to reduce environmental impact and the results from the measures taken are believed to have been caused mainly by the innate differences between the European and Asian energy markets, as well as the more stringent demands of stakeholders and legislation in Europe. |
| Keywords: | greenhouse gas emission decomposition analysis automotive corporation corporate environmental management carbon leakage |
| JEL: | M14 Q54 Q57 |
| Date: | 2015–08–25 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66264&r=all |
| By: | James Alm (Department of Economics, Tulane University); Jay Shimshack (Frank Batten School of Leadership and Public Policy, University of Virginia) |
| Abstract: | Environmental monitoring and enforcement are controversial and incompletely understood. This survey reviews what we do and do not know about the overall effectiveness, as well as the cost effectiveness, of pollution monitoring and enforcement. We ask five key questions: What do environmental monitoring and enforcement actions look like in the real world? How do we assess environmental compliance and deterrence? Do environmental monitoring and enforcement actions get results? How, why, and when do inspections and sanctions achieve compliance and reduce pollution? And, what do the answers to the preceding questions tell us about designing and implementing more effective and more cost effective public policies for the environment? A key contribution is drawing lessons from diverse sources, including insights from theoretical, empirical, and experimental contributions in environmental, tax, and safety settings. We conclude that traditional environmental monitoring and enforcement actions generate important deterrence effects. However, there are limits to such deterrence, and deterrence itself cannot fully explain all patterns of environmental behavior. Encouraging compliance requires both traditional tools and additional tools. |
| Keywords: | environmental economics, enforcement and compliance |
| JEL: | Q50 Q58 K32 H26 |
| Date: | 2014–10 |
| URL: | http://d.repec.org/n?u=RePEc:tul:wpaper:1409&r=all |
| By: | Aldy, Joseph E. (Harvard University and Resources for the Future); Pizer, William A. (Duke University and Resources for the Future) |
| Abstract: | We develop a precise definition of the competitiveness impacts of environmental regulation that can be estimated with available domestic production, trade, and energy price data. We use this definition and a 9-year panel of nearly 450 U.S. manufacturing industries to estimate and predict the effects of a U.S.-only $15 per ton CO2 price. We find competitiveness effects on the order of a 0.5 to 0.8 percent decline in production among energy-intensive manufacturing industries, representing about one-sixth of the policy's impacts on these firms' output. |
| JEL: | F18 Q52 Q54 |
| Date: | 2014–05 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp14-025&r=all |
| By: | Bodansky, Daniel M. (AZ State University); Hoedl, Seth (Harvard University); Metcalf, Gilbert (Tufts University); Stavins, Robert (Harvard University) |
| Abstract: | Negotiations pursuant to the Durban Platform for Enhanced Action appear likely to lead to a 2015 Paris agreement that embodies a hybrid climate policy architecture, combining top-down elements, such as for monitoring, reporting, and verification, with bottom-up elements, including "nationally determined contributions" from each participating country, detailing what it intends to do to reduce emissions, based on its national circumstances. For such a system to be cost-effective--and thus more likely to achieve significant global emissions reductions--a key feature will be linkages among regional, national, and sub-national climate policies. By linkage, we mean a formal recognition by a greenhouse gas mitigation program in one jurisdiction (a regional, national, or sub-national government) of emission reductions undertaken in another jurisdiction for purposes of complying with the first jurisdiction's mitigation program. We examine how a future international policy architecture could help facilitate the growth and operation of a robust system of international linkages of regional, national, and sub-national policies. Several design elements merit serious consideration for inclusion in the Paris agreement, either directly or by establishing a process for subsequent international elaboration. At the same time, including detailed linkage rules in the core agreement is not desirable because this could make it difficult for rules to evolve in light of experience. |
| Date: | 2015–01 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp15-003&r=all |
| By: | Peterson, Sonja |
| Abstract: | This policy brief explores the potential scope and optimal design of national climate policies in the European climate policy context. It argues that the recent German proposal of a climate levy for electricity generators (BMWi 2015) has the potential to reconcile EU and national policies. Section 2 starts with a brief introduction into the present EU climate policy regime and the rationale of national climate policies in this framework. The bottom line is that the current setting basically justifies national targets and policies only for the sectors that are not already covered by the European emissions trading scheme (EU ETS). Section 3 discusses the deficiencies of the EU ETS which is the major reason why additional national polices for the EU ETS sectors can still be justified. Section 4 focusses on how such national policies should be designed. Section 5 takes the proposed German climate level as an interesting example of a new type of national policy and discusses how it could be optimized. Section 6 summarizes and concludes. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ifwkpb:92&r=all |
| By: | Bodansky, Daniel M. (AZ State University); Hoedl, Seth A. (Harvard University); Metcalf, Gilbert E. (Tufts University); Stavins, Robert N. (Harvard University) |
| Abstract: | Negotiations pursuant to the Durban Platform for Enhanced Action appear likely to lead to a 2015 Paris agreement that embodies a hybrid climate policy architecture, combining top-down elements, such as for monitoring, reporting, and verification, with bottom-up elements, including "nationally determined contributions" from each participating country, detailing what it intends to do to reduce emissions, based on its national circumstances. For such a system to be cost-effective--and thus more likely to achieve significant global emissions reductions--a key feature will be linkages among regional, national, and sub-national climate policies. By linkage, we mean a formal recognition by a greenhouse gas mitigation program in one jurisdiction (a regional, national, or sub-national government) of emission reductions undertaken in another jurisdiction for purposes of complying with the first jurisdiction's mitigation program. We examine how a future international policy architecture could help facilitate the growth and operation of a robust system of international linkages of regional, national, and sub-national policies. Several design elements merit serious consideration for inclusion in the Paris agreement, either directly or by establishing a process for subsequent international elaboration. At the same time, including detailed linkage rules in the core agreement is not desirable because this could make it difficult for rules to evolve in light of experience. |
| Date: | 2014–11 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp14-056&r=all |
| By: | Michael MacLeod; Vera Eory; Guillaume Gruère; Jussi Lankoski |
| Abstract: | This paper reviews the international literature on the cost-effectiveness of supply-side mitigation measures that can reduce the emissions intensity of agriculture while maintaining or increasing production. Sixty-five recent international studies of cost-effectiveness covering 181 individual activities are reviewed. Nine case studies of well covered mitigation measures, generally using a cost-engineering approach, illustrate significant differences in the cost-effectiveness of measures across countries and studies, in part due to contextual differences. Although caution needs to be exercised in comparing heterogeneous studies, the results suggest that measures based on fertiliser use efficiency, cattle breeding, and potentially improving energy efficiency in mobile machinery, are often considered highly cost-effective mitigation measures across countries. A preliminary overview of policy highlights the existence of a range of options to encourage the adoption of cost-effective measures, from information to incentive-based policies. Further analysis is needed to address remaining estimation challenges and to help determine how mitigation measures may be embedded into broader climate, agricultural and environmental policy frameworks. |
| Keywords: | climate change, greenhouse gas mitigation, agricultural, cost-effectiveness, agriculture |
| JEL: | Q16 Q52 Q54 Q58 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:oec:agraaa:89-en&r=all |
| By: | Vasily Astrov (The Vienna Institute for International Economic Studies, wiiw); Doris Hanzl-Weiss (The Vienna Institute for International Economic Studies, wiiw); Michael Landesmann (The Vienna Institute for International Economic Studies, wiiw); Olga Pindyuk (The Vienna Institute for International Economic Studies, wiiw); Robert Stehrer (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | Graph of the month Energy sector – selected indicators (p. 1) Opinion corner Is there any Chance of a Compromise in the Greek Crisis? (by Michael Landesmann; pp. 2-3) Natural gas and electricity prices in the EU and its major industrial competitors (by Vasily Astrov and Doris Hanzl-Weiss; pp. 4-10) Energy cost shares and energy intensities in manufacturing comparing the EU with its major external competitors (by Robert Stehrer; pp. 11-14) Energy intensity, energy cost shares and industrial competitiveness (by Sandra Leitner, Vasily Astrov, Robert Stehrer and Olga Pindyuk; pp. 15-19) Recommended reading (p. 20) Statistical Annex Monthly and quarterly statistics for Central, East and Southeast Europe (pp. 21-42) |
| Keywords: | energy sector, energy prices, international finance, foreign debt, energy intensity, competitiveness |
| Date: | 2015–02 |
| URL: | http://d.repec.org/n?u=RePEc:wii:mpaper:mr:2015-02&r=all |
| By: | S. KUMAR (Asian Institute of Technology) |
| Abstract: | This paper discusses the status, opportunities, and modalities for engendering liveable low-carbon smart cities in ASEAN as an inclusive green growth model and the opportunities for regional cooperation. Rapid economic growth and increases in urban population in the Association of Southeast Asian Nations (ASEAN) cities will require the consumption of a huge amount of resources which will damage the local and global environment and produce an enormous amount of waste if not handled appropriately. Such environmentally unsustainable growth undermines public health and safety, comfort and liveability, and more importantly is a barrier to achieving global targets for emission reduction. Transforming cities to make them liveable through low-carbon green growth will not only increase the comfort for the city dwellers by improving liveability, but also minimise greenhouse gas (GHG) emissions. Already, initiatives have been taking place in ASEAN to encourage cities to promote green growth through practicing environmental sustainability. Such initiatives are often implemented on a project basis, which are short term and lack a sustaining impact in the region. A well-constructed, city-level, and market-driven framework that allows for participation of all stakeholders and that has a built-in monitoring and evaluation system with well-thought-out measurable indicators to track performance would be useful to systematically transform ASEAN cities. Regional cooperation, such as through facilitating knowledge sharing, has a role to play in strengthening low-carbon green growth development in the region. Therefore, during 2015–2025, the ASEAN Socio-Cultural Community (ASCC) will provide an excellent opportunity to spearhead such activities in a systematic and consistent manner, be a model, and show the world the benefits of low-carbon city development. |
| Keywords: | : Smart cities, climate change, green growth, ASEAN |
| JEL: | Q4 Q3 Q28 Q5 |
| Date: | 2015–09 |
| URL: | http://d.repec.org/n?u=RePEc:era:wpaper:dp-2015-57&r=all |
| By: | Aldy, Joseph E. (Harvard University and Resources for the Future); Pizer, William A. (Duke University and Resources for the Future) |
| Abstract: | The pollution haven hypothesis suggests that unilateral domestic climate change mitigation policy would impose significant economic costs on carbon-intensive industries, resulting in declining output and increasing net imports. In order to evaluate this hypothesis, we undertake a two-step empirical analysis. First, we use historic energy prices as a proxy for climate change mitigation policy. We estimate how production and net imports change in response to energy prices using a 35-year panel of approximately 450 U.S. manufacturing industries. Second, we take these estimated relationships and use them to simulate the impacts of changes in energy prices resulting from a domestic climate change mitigation policy that effectively imposes a $15 per ton carbon price. We find that energy-intensive manufacturing industries are more likely to experience decreases in production and increases in net imports than less-intensive industries. Our best estimate is that competitiveness effects--measured by the increase in net imports--are as large as 0.8 percent for the most energy-intensive industries and represent no more than about one-sixth of the estimated decrease in production under a $15 per ton carbon price. |
| JEL: | F18 Q52 Q54 |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:harjfk:rwp15-046&r=all |
| By: | Aldy, Joseph Edgar |
| Abstract: | Adaptation and geoengineering responses to climate change should be taken in account when estimating the social cost of carbon. |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:hrv:hksfac:21150339&r=all |
| By: | Brian P. FLANNERY (FERDI) |
| Abstract: | Today, with little time remaining, negotiators confront a disorganized text that is far too long and replete with conflicting proposals that cross red lines for major players. Nonetheless, political leaders express confidence that a deal is achievable.Unlike the task of Kyoto—producing politically feasible mitigation targets for developed nations—the post 2020 agreement covers (at least) six themes: mitigation for all nations, adaptation, finance, technology transfer, capacity building and transparency. Residual acrimony and distrust from Copenhagen hamper the process which must resolve many complex, contentious issues, e.g. legal form and compliance, the role (or not) for markets and offset projects, intellectual property rights, compensation for loss and damage, transparency and associated measurement, reporting and verification (MRV) and review procedures. Overshadowing all remains the question of how the principle of common but differentiated responsibilities (CBDR) will manifest throughout the agreement, e.g. from mitigation to reporting and review to finance.Some aspects are solidifying. Mitigation efforts will not be negotiated; rather, they are being submitted (as Intended Nationally Determined Contributions: INDCs), and, ultimately, recorded, perhaps (dropping the I) becoming NDCs. Total financial aid appears set by the Copenhagen pledge of developed nations to mobilize 100 billion US$ per year by 2020. Also, negotiators appear resolved to create a durable framework based on cycles of review and renewal over intervals of, perhaps, 5 or 10 years.However, the Paris Agreement appears unlikely to fulfill the long-established narrative to be “on track” to limit warming to less than 2 (or 1.5) C. Only recently have political leaders begun to temper expectations. They will need to manage expectations thoughtfully to avoid a backlash from a range of nations, stakeholders and media, and to restore the credibility of United Nations Framework Convention on Climate Change (UNFCCC) as an effective process. |
| Date: | 2015–08 |
| URL: | http://d.repec.org/n?u=RePEc:fdi:wpaper:2265&r=all |
| By: | Oribuyaku, Damilola |
| Abstract: | The report has outlined the details of Nigeria’s current and future policy framework. Building on that, the report then critically reviewed the framework in relation to the approach taken in other regions, particularly the UK. Finally, the report attempted to produce a high level vision of a sustainable built environment policy framework for Nigeria. If it is agreed that most policies are not focused on the built environment even when emissions from the built environment, as evidenced by cement production, is experiencing a sharp increase, the Nigerian government should make efforts at designing a specialized policy framework for the built environment |
| Keywords: | Keywords: Policy Framework, Mitigation, Adaptation, Climate Change |
| JEL: | I3 I38 Q2 Q42 Q48 |
| Date: | 2015–01–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:66197&r=all |