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on Energy Economics |
| By: | Mense, Andreas |
| Abstract: | The German Energy Performance of Buildings Directive requires sellers on the housing market to provide detailed information on expected yearly energy consumption per square meter. This paper uses variation in local fuel prices and climate, fuel types, and building ages to analyze the relationship between expected energy cost savings from energy efficient building structure and house prices in Germany. Results suggest that heating cost considerations are less relevant than previously thought. |
| JEL: | R21 R31 Q40 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc17:168212&r=ene |
| By: | Abada, I.; Ehrenmann, A.; Lambin, X. |
| Abstract: | Following the development of decentralized production technologies, energy communities have become a topic of increased interest. While the potential benefits have been described, we use the framework of cooperative game theory to test the ability of such communities to adequately share the gains. Indeed, despite the potential value created by such coalitions, there is no guarantee that they will be viable: a subset of participants may find it profitable to exit the community and create another one of their own. We take the case of a neighborhood, having access to a limited resource e.g. a shared roof or piece of land which they can exploit if they invest in some renewable production capacity. By joining the community, participants also enjoy aggregation gains in the form of reduced network fees. We find conditions depending on the structure of renewable installation costs, on the magnitude of the aggregation effect and coordination costs and, most importantly, on the chosen sharing rule, under which the whole energy community is stable. Efficiency could require the intervention of a social planner or a change in network tariff structures. |
| Keywords: | Energy communities, Cooperative game theory, Decentralized power production, Consumer participation, Micro-grids |
| JEL: | C71 Q42 Q48 Q55 Q21 |
| Date: | 2017–10–18 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1740&r=ene |
| By: | Bernardino Adao; Borghan Narajabad; Ted Loch-Temzelides |
| Abstract: | We study the effect of technological progress on the optimal transition to a renewable energy-fueled world economy. We develop a dynamic general equilibrium model where energy is used as an input in production and can come from fossil or renewable sources. Both require the use of capital, which is also needed in the production of final goods. Renewable energy firms can invest in improving the productivity of their capital stock. The actual improvement is subject to spillovers and involves an opportunity cost. This results in underinvestment in the productivity of renewable energy capital. In the presence of environmental externalities, the optimal allocation can be implemented through a Pigouvian tax on fossil fuel, together with policy that promotes new renewable technologies. We calibrate our model using world-economy data and characterize the transition toward a low carbon economy. We find that it is optimal for renewables to “start small†and pick up their market penetration only later. In the short run, investment is needed mainly to improve productivity in the renewable energy sector. Later, renewable energy contributes by becoming a “modest†engine of economic growth. It takes approximately 150 years before fossil fuel is phased out entirely, resulting in a 2.8 degree Celsius temperature increase. |
| JEL: | D81 H21 Q54 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6372&r=ene |
| By: | Elias Soukiazis (CeBER and Faculty of Economics of the University of Coimbra); Sara Proença (CERNAS/ESAC Polytechnic Institute of Coimbra); Pedro André Cerqueira (CeBER and Faculty of Economics of the University of Coimbra) |
| Abstract: | The relationship between renewable energy sources and economic growth has attracted the interest of researchers in recent years. However, the analysis has focused mostly on measuring the impact of renewable energy consumption on economic performance (such as economic growth) that does not reflect the quality of standards of living. We employ a different approach measuring the impact of renewable energy consumption on the Human Development Index (HDI) that considers these qualitative characteristics associated with better health and educational standards along with income performance. Additionally, we develop a simultaneous equation system approach that describes the interrelations between economic variables, renewable energy and pollution emissions with feedback effect tendencies. We provide robust evidence using panel data for a set of 28 OECD countries over the period 2004-2015. The system of equations is estimated by 3sls considering a static and dynamic specification of the model. It is shown that renewable energy consumption along with human and physical capital are important factors for explaining the sustainable development level of the countries considered. Renewable energy consumption is mostly determined by higher levels of human capital, the R&D spending and the stage of countries’ development. Factors like the stage of development, total energy consumption, renewable energy consumption and standard levels of education are important elements for explaining environmental pollution (measured by CO2 emissions per capita). It is also established a non-linear relationship between the countries` stage of development and carbon emissions. |
| Keywords: | Renewable energy, human development index, simultaneous equation system, panel data. |
| JEL: | O13 Q2 C33 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:gmf:papers:2017-10&r=ene |
| By: | Bocar Samba Ba (Centre d'Etudes et de Recherches sur le Développement International (CERDI)); Raphaël Soubeyran (Institut National de Recherches Agronomiques (INRA) de Montpellier (LAMETA)) |
| Abstract: | We study the exploitation of recyclable exhaustible resources such as rare earths and Phosphorus. We use a standard Hotelling model of resource exploitation that includes a primary sector and a recycling sector. We show that, when the primary sector is competitive, the price of the recyclable resource increases through time. This result stands in contrast to durable resources, for which the optimal price path is either decreasing or U-shaped. We then show a new reason why the price of an exhaustible resource may decrease: when the primary sector is monopolistic, the primary producer has incentives to delay its production activities in order to delay recycling. As a consequence, the price path of the recyclable resource may be U-shaped. We also show that a technological improvement in the recycling sector increases the price in the short term but decreases it later. |
| Keywords: | Rare earths, Phosphorus, Recycling, Competition, Optimal control |
| JEL: | D40 D43 L12 L13 Q31 |
| Date: | 2017–01 |
| URL: | http://d.repec.org/n?u=RePEc:fae:wpaper:2017.01&r=ene |
| By: | Mohammad Reza Hesamzadeh; Juan Rosellón; Steven A. Gabriel; Ingo Vogelsang |
| Abstract: | The informationally simple approach to incentive regulation applies mechanisms that translate the regulator’s objective function into the firm’s profit-maximizing objective. These mechanisms come in two forms, one based on subsidies/taxes,the other based on constraints/ price caps. In spite of a number of improvements and a good empirical track record simple approaches so far remain imperfect. The current paper comes up with a new proposal, called H-R-G-V, which blends the two traditions and is shown to apply well to electricity transmission pricing and investment. In particular, it induces immediately optimal pricing/investment but is not based on subsidies. In the transmission application, the H-RG- V approach is based on a bilevel optimization with the transmission company (Transco) at the top and the independent system operator (ISO) at the bottom level. We show that HR- G-V, while not perfect, marks an improvement over the other simple mechanisms and a convergence of the two traditions. We suggest ways to deal with remaining practical issues of demand and cost functions changing over time. |
| Keywords: | Electricity transmission, incentive regulation, multi-level optimization |
| JEL: | D24 L51 L94 Q40 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1696&r=ene |
| By: | Kaicker, Nidhi; Dutta, Goutam; Das, Debamanyu; Banerjee, Subhashree |
| Abstract: | This study establishes the feasibility condition for efficiency gains to arise from time-of-use pricing in the electricity market in a monopolistic and oligopolistic set up using constrained optimization. In an oligopolistic set-up, the strategic interaction between producers depends on the level of demand. In case of high demand, the producers compete on the basis of output they will produce, resulting in a Cournot-type competition. On the other hand, in case of low demand, an oligopolistic structure may break with only the most efficient firm operating, or results in the emergence of leader firms and follower firms, i.e. the Stackleberg model. |
| Date: | 2017–10–17 |
| URL: | http://d.repec.org/n?u=RePEc:iim:iimawp:14580&r=ene |
| By: | Giovanni Marin (Department of Economics, Society and Politics, University of Urbino 'Carlo Bo', Italy); Francesco Vona (OFCE-SciencesPo and SKEMA Business School, Sophia Antipolis, France) |
| Abstract: | This paper evaluates the historical influence of energy prices on a series of measures of environmental and economic performance for a panel of French manufacturing establishments over the period 1997-2010. The focus on energy prices is motivated by the fact that changes in environmental and energy policies have been dominated by substantial reductions in discounts for large consumers, making the evaluation of each policy in isolation exceedingly difficult. To identify price effects, we construct a shift-share instrument that captures only the exogenous variation in establishment-specific energy prices. Our results highlight a trade-off between environmental and economic goals: although a 10\% increase in energy prices brings about a 6\% reduction in energy consumption and to a 11\% reduction in CO2 emissions, such an increase also has a modestly negative impact on employment (-2.6\%) and very small impact on wages and productivity. The negative employment effects are mostly concentrated in energy-intensive and trade-exposed sectors. Simulating the effect of a carbon tax, we show that job losses for the most exposed sectors can be quite large. However, these effects are upper bounds and we show that they are significantly mitigated in multi-plant firms by labor reallocation across establishments. |
| Keywords: | energy prices, establishment performance, environmental and energy policy |
| JEL: | Q52 Q48 H23 D22 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:srt:wpaper:0717&r=ene |
| By: | Gerli, Paolo; Van der Wee, Marlies; Verbrugge, Sofie; Whalley, Jason |
| Abstract: | Utility providers, such as energy companies and railway operators, have been long emphasised as driving competition and facilitating investment in broadband markets. Nevertheless, their involvement and contribution to broadband development has varied significantly over time. In the late 1990s, both local and national utilities engaged in the provision of broadband networks, but only few of them managed to establish themselves as major broadband providers. More recently, new projects involving national utilities have been announced in several EU countries, opening new scenarios for utilities’ contribution to Next Generation Access (NGA) development. This paper aims to explore and identify the factors affecting the entry and the success of utilities in the European broadband market. Four case studies from four EU countries (Germany, Italy, Sweden and the UK) are investigated and compared, to highlight similarities and differences under the EU regulatory framework. This qualitative analysis takes into account the interaction of market, technology and policy factors, focusing on the impact of policy and regulatory measures. As a result, this paper provides fruitful insights into the relevance and effectiveness of public interventions in broadband markets. Public support and public ownership are identified as main drivers for the involvement of utilities in EU broadband markets, with regulatory measures and economies of scope exerting a limited and decreasing influence. |
| Keywords: | Utility providers,broadband investment,broadband policy,open-access networks |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:itse17:169461&r=ene |
| By: | Halkos, George |
| Abstract: | Energy is a very important topic of research driving the modern world. Energy production and consumption are associated with a number of environmental effects that require effective and affordable management. Demanding an enormous amount of energy an immense dispute of energy is scale counted by energy efficiency. Oil and other fossil fuel depletion, reliance on foreign energy sources, energy needs of poorer countries, economic efficiency versus population growth debate, environmental issues like climate change, renewable and other alternative energy sources are some of the issues of concern. This Special Issue contributes to some of the important issues of global energy and sustainability. The applied theoretical and analytical contributions are expected to provide guidance to policy-makers and government officials in designing new policy scenarios for the investigation of the energy consumption and economic growth nexus. The empirical contributions provide also evidence to support and inform current policy debates. |
| Keywords: | Energy; sustainability; development. |
| JEL: | O11 Q40 Q48 Q5 Q56 Q58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:81967&r=ene |
| By: | Farzanegan, Mohammad Reza |
| Abstract: | This study shows that the level of corruption matters in how oil rents affect the military spending within countries. Using panel data covering the 1984–2014 period for the Middle East and North Africa countries, we find that the effect of oil rents on military budget depends on the extent of political corruption. Oil wealth boosts military spending when corruption (measured by the re-scaled ICRG index) exceeds a critical score of 5 (out of 6) in the MENA region. |
| JEL: | H10 H56 H57 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc17:168157&r=ene |
| By: | Haucap, Justus; Heimeshoff, Ulrich; Siekmann, Manuel |
| Abstract: | We use a novel data set with exact price quotes from virtually all German gasoline stations to empirically investigate how a temporary variance in local market structure induced by restricted opening hours of specific players affects price competition. We find that, during their hours of opening, they have a significant negative price effect on nearby competitors. |
| JEL: | L71 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc17:168198&r=ene |
| By: | TAMADA Dai |
| Abstract: | This paper aims at analyzing several cases of investor-State dispute settlement (ISDS) which relate to the feed-in tariff (FIT) of the renewable energy sector, for the purpose of extracting the legal issues involved in them. On the basis of this analysis, it will bring some implications toward Japan, both from the investors' viewpoint and the host-State's perspective. First, in European and North American countries, there have been many cases in which foreign investors (claimants) submitted disputes, against the host-States, before the ISDS concerning the operation and abolishment of the FIT system. In particular, the main topic is to allege a violation of the fair and equitable treatment (FET) obligation stipulated in the applicable international investment agreement. Second, in cases against Spain, the Tribunal either admitted a breach of FET ( Eiser case) or did not ( Charanne case and Isolux case). The same applies in the cases against Canada. These situations require us to analyze the reason why there has been a difference of conclusions. Third, on the basis of the above analysis, it will become possible to evaluate the modified FIT law of Japan (2016) and present some implications about it. |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:17060&r=ene |
| By: | Mohammad Reza Farzanegan (Philipps-Universität Marburg); Marcel Thum (TU Dresden) |
| Abstract: | The resource curse hypothesis suggests that resource-rich countries (especially oil dependent economies) show lower economic growth rates compared to resource-poor countries. We add to this literature by providing empirical evidence on a new transmission channel of the resource curse, namely, the negative long-run effect of oil rents on the quality of education. Our empirical analysis for more than 70 countries in the period of 1995-2015 shows a significantly positive effect of oil rents on the quantity of education measured by government spending on primary and secondary education. However, we find a robust and negative long-run effect of oil rents dependency on the objective and subjective indicators of quality of education, controlling for a set of other drivers of education quality and regional dummies. The significant negative effect of oil rents dependency on education quality can be explained by both the demand (e.g., skill acquisition) and supply (e.g., teacher quality) side channels. |
| Keywords: | oil rents, resource curse, quality of education, quantity of education |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:mar:magkse:201745&r=ene |
| By: | Alan R. Roe |
| Abstract: | This paper extends UNU-WIDER Working Paper 2016/79, which examined the economic situation in Tanzania during the resurgence of gold and diamond production after 1999, with the situation that emerged as the country began to exploit its very large resources of natural gas mainly from the Indian Ocean. The mining boom after 1999 provided the authorities with significant lessons and opportunities associated with managing natural resource wealth. The present paper additionally examines some of the specific policy and regulatory decisions taken since 2015, and tries to assess how the multiple challenges of new natural gas wealth are being addressed. It concludes that the experience thus far is not encouraging. |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:unu:wpaper:wp2017-175&r=ene |
| By: | Justin Leroux; Daniel Spiro |
| Abstract: | Arctic oil extraction is inconsistent with the 2°C target. We study unilateral strategies by climate-concerned Arctic countries to deter extraction by others. Contradicting common theoretical assumptions about climate-change mitigation, our setting is one where countries may fundamentally disagree about whether mitigation by others is beneficial. Arctic extraction requires specific R&D, hence entry by one country expands the extraction-technology market, decreasing costs for others. Less environmentally-concerned countries (preferring maximum entry) have a first-mover advantage but, being reliant on entry by others, can be deterred if environmentally-concerned countries (preferring no entry) credibly coordinate on not following. Furthermore, using a pooling strategy, an environmentally-concerned country can deter entry by credibly “pretending†to be environmentally adamant, thus expected to not follow. A rough calibration, accounting for recent developments in U.S. politics, suggests a country like Norway, or prospects of a green future U.S. administration, could be pivotal in determining whether the Arctic will be explored. |
| Keywords: | arctic region, oil exploration, climate change, geopolitics, unilateral action |
| JEL: | D82 F50 O33 Q30 Q54 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6629&r=ene |
| By: | Alexander Monge-Naranjo; Juan M. Sánchez; Raül Santaeulàlia-Llopis |
| Abstract: | Are production factors allocated efficiently across countries? To differentiate misallocation from factor intensity differences, we provide a new methodology to estimate output shares of natural resources based solely on current rent flows data. With this methodology, we construct a new dataset of estimates for the output shares of natural resources for a large panel of countries. In sharp contrast with Caselli and Feyrer (2007), we find a significant and persistent degree of misallocation of physical capital. We also find a remarkable movement toward efficiency during last 35 years, associated with the elimination of interventionist policies and driven by domestic accumulation. Interestingly, when both physical and human capital can be reallocated, capital would often flow from poor to rich countries. |
| Keywords: | natural rents, factor shares, misallocation, international flows, human capital |
| JEL: | O11 O16 O41 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:bge:wpaper:994&r=ene |
| By: | Martijn Bos (Tilburg School of Economics and Management (TISEM), Tilburg University, Tilburg, the Netherlands); Riza Demirer (Department of Economics and Finance, Southern Illinois University Edwardsville, Edwardsville, USA); Rangan Gupta (University of Pretoria, Pretoria, South Africa and IPAG Business School, Paris, France); Aviral Kumar Tiwari (Center for Energy and Sustainable Development (CESD), Montpellier Business School, Montpellier, France) |
| Abstract: | This paper provides a novel perspective to the oil-stock market nexus by examining the predictive ability of mergers and acquisitions (M&A) over West Texas Intermediate (WTI) oil returns and volatility using a nonparametric quantile-based methodology. Our findings suggest that M&A activity carries significant predictive power over oil return and volatility, while predictability displays remarkably distinct patterns across various quantiles representing normal, bull and bear market states. We also observe that M&A activity by oil firms, i.e. both the acquiring and target firms considered active in the oil and gas (O&G) industry, generally carries greater predictive power over both oil returns and volatility compared to M&A activity by non-oil acquirers, i.e. acquirers that have entered the O&G industry by buying an oil company. Our findings imply that M&A activity in the O&G industry carries valuable fundamental information regarding future expectations on oil price dynamics and should be taken into account in forecasting exercises. |
| Keywords: | Oil Returns and Volatility, Mergers and Acquisitions, Oil and Gas Industry, Nonparametric Quantile Causality |
| JEL: | C22 C58 Q31 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:201775&r=ene |
| By: | Petter Osmundsen; Kjell Løvås; Magne Emhjellen |
| Abstract: | The recent dramatic fall in oil prices has led to extensive capital rationing in international oil companies, and subsequent fierce competition between resource extraction countries to attract scarce investment. This situation is not adequately addressed by the large literature on international taxation and multinational companies, since it fails to take account of capital rationing in its assumption that companies sanction all projects with a positive net present value. The paper examines the effect of tax design on international capital allocation when companies ration capital. We analyse capital allocation and government take for four equal oil projects in three different fiscal regimes: the US GoM, UK upstream and Norway offshore. Implications for optimal tax design are discussed. |
| Keywords: | taxation, international companies, project metrics, project valuation, oil projects |
| JEL: | H21 H25 F23 Q40 G12 G31 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6390&r=ene |
| By: | Cristina Conflitti; Matteo Luciani |
| Abstract: | Quantifying the magnitude and establishing the timing of the pass-through of oil price changes to consumer prices is crucial for forecasting inflation. Characterizing this pass-through is particularly important because oil prices tend to undergo wide fluctuations. In this note we presented estimates of the oil price pass-through into consumer prices both in the US and in the euro area. |
| Date: | 2017–10–19 |
| URL: | http://d.repec.org/n?u=RePEc:fip:fedgfn:2017-10-19-1&r=ene |
| By: | Michael Ludkovski; Xuwei Yang |
| Abstract: | In a game theoretic framework, we study energy markets with a continuum of homogenous producers who produce energy from an exhaustible resource such as oil. Each producer simultaneously optimizes production rate that drives her revenues, as well as exploration effort to replenish her reserves. This exploration activity is modeled through a controlled point process that leads to stochastic increments to reserves level. The producers interact with each other through the market price that depends on the aggregate production. We employ a mean field game approach to solve for a Markov Nash equilibrium and develop numerical schemes to solve the resulting system of non-local HJB and transport equations with non-local coupling. A time-stationary formulation is also explored, as well as the fluid limit where exploration becomes deterministic. |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1710.05131&r=ene |
| By: | Glensk, Barbara (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)); Madlener, Reinhard (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)) |
| Abstract: | In this paper we develop a decision tool that is based on real options analysis and that supports flexibility investment decisions concerning conventional lignite-fired power plants. The value of the power plant is influenced both by technical and economic variables, the latter including subsidies. The four-step approach proposed allows to determine the optimal operation strategy in light of electricity and fuel price developments, to simulate the project value, to determine the binomial lattice of the expected project value, and finally to infer the optimal management decision (based on the option to choose). For the case of an existing lignite-fired power plant in Germany, we find that the plant can be operated profitably without any modifications until the end of its technical lifetime only if current government subsidies persist. In the absence of subsidies, however, it is preferable to stop operation immediately. The analysis also shows that profitable reinvestments in a number of flexibility retrofit measures are possible, the ranking of which depends, however, on the costs related to the retrofitting measures and their implementation time. |
| Keywords: | real options; exibility options; energy market; lignite-fired power plants |
| JEL: | Q40 Q48 |
| Date: | 2017–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:fcnwpa:2016_010&r=ene |
| By: | Brown, Charles |
| Date: | 2016–03–30 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genstf:201603301431511432&r=ene |
| By: | James B. Bushnell; Jonathan E. Hughes; Aaron Smith |
| Abstract: | Grain shippers and political figures in North Dakota and nearby states have voiced concern that the dramatic increases in shipments of crude oil by rail have caused service delays and higher costs. We investigate the potential impact of crude shipments on grain markets accounting for harvest effects and other potential sources of rail congestion. Increased crude oil shipments are associated with substantially larger spreads between wheat prices at regional elevators and in Minneapolis, the market hub. The effect on corn and soybean spreads are an order of magnitude smaller. Increased oil traffic is associated with small increases in rail rates but large increases in rail car auction prices. We document increases in wheat carry (storage) costs and decreases in shipment quantities. Surprisingly, little of the spread increase is due to lower prices paid to farmers, suggesting consumers rather than producers paid the cost of increased rail congestion. |
| JEL: | H22 Q02 |
| Date: | 2017–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:23924&r=ene |
| By: | Liao, Kenneth |
| Abstract: | This dissertation contains three studies that estimate the distribution of willingness to pay (WTP) for E85 as a substitute for E10 among flex motorists in the United States. The results are vital for estimating the demand for ethanol beyond the blend wall and for analysis of the Renewable Fuel Standard. The first study attempts to estimate the distribution of preference for E85 from data generated by a survey of E85 stations in Minnesota. The study uses an extensive sample of recent observations, but estimates of the WTP distribution vary substantially depending on model specification. The conclusion is that the data are not suitable to estimate the distribution of WTP for E85.The second and third studies collect primary data from E85 stations in different regions of the United States to more accurately estimate preferences for E85 and investigate locational differences. The studies obtain revealed-preference (RP) data from flex motorists refueling at E85 stations and stated-preference (SP) data from surveying the flex motorists and presenting hypothetical scenarios. The second study uses the RP data to estimate relative preferences for E85, and the third study incorporates the SP data to better capture the wide range of fuel-switching behavior.The estimation sample consists of about nine hundred flex motorists in six urban areas in the Midwest and California. The sample of flex motorists who refuel at E85 stations is endogenously stratified; the probability of a flex motorist appearing in the sample is correlated to the motorist's WTP for E85. The models apply corrective probability weights so estimates reflect the population and not the sample.The results show that a $0.10 increase in the E85-E10 price difference decreases the probability of motorists choosing E85 by about 2.5 percent, on average, and preferences are spread over a broad range of fuel prices. In general, motorists are willing to pay more for E85 in California than in the Midwest, and when E85 and E10 are priced equally on a cost-per-mile basis, about 25 percent of flex motorists choose E85 in the Midwest compared to 75 percent in California. |
| Date: | 2016–01–01 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genstf:201601010800005988&r=ene |
| By: | Petersen, Dana; Hanna, Mark |
| Date: | 2016–03–25 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genstf:201603251509491410&r=ene |
| By: | Petersen, Dana; Hanna, Mark |
| Date: | 2016–03–23 |
| URL: | http://d.repec.org/n?u=RePEc:isu:genstf:201603231539361401&r=ene |
| By: | Julie-Anne Cronin; Don Fullerton; Steven Sexton |
| Abstract: | Because electricity is a higher fraction of spending for those with low income, carbon taxes are believed to be regressive. Many argue, however, that their revenues can be used to offset the regressivity. We assess these claims by employing data on 322,000 families in the U.S. Treasury’s Distribution Model to study vertical redistributions between rich and poor, as well as horizontal redistributions among families with common incomes but heterogeneous energy intensity of consumption (different home heating and cooling demands). Accounting for the statutory indexing of transfers, and measuring impacts on annual consumption as a proxy for permanent income, we find that the carbon tax burden is progressive, rising across deciles as a fraction of consumption. The rebate of revenue via transfers makes it even more progressive. In every decile, the standard deviation of the change in consumption as a fraction of consumption varies around 1% or 2% and is larger than the average burden (about 0.7%). When existing transfer programs are used to rebate revenue, the tax and rebate together increase that variation to more than 3% within each decile. The average family in the poorest decile gets a net tax cut of about 1% of consumption, but 44% of them get a net tax increase. Relative to no rebate, every type of rebate we consider increases this variation within most deciles. |
| Keywords: | incidence, climate policy, revenue-neutral reform |
| JEL: | Q58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6373&r=ene |
| By: | Diane Aubert; Mireille Chiroleu-Assouline |
| Abstract: | This paper investigates the distributional and efficiency consequences of an environmental tax reform, when the revenue from the green tax is recycled by varying labor tax rates. We build a general equilibrium model with imperfect heterogeneous labor markets, pollution consumption externalities, and non-homothetic preferences (Stone-Geary utility). We show that in the case where the reform appears to be regressive, the gains from the double dividend can be made Pareto improving by using a redistributive non-linear income tax if redistribution is initially not too large. Moreover, the increase of progressivity acts on unemployment and can moderate the trade-off between equity and efficiency. We finally provide numerical illustrations for three European countries featuring different labor market behaviors. We show that a double dividend may be obtained without worsening the initial inequalities if the green tax revenues are redistributed with a progressivity index lower for UK than for France and Germany. |
| Keywords: | environmental tax reform, heterogeneity, unemployment, welfare analysis, tax progressivity |
| JEL: | D62 D63 H23 Q52 Q58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6498&r=ene |
| By: | Ana Maria Montoya Gómez; Markus Zimmer |
| Abstract: | We study the effect of climate policy on companies’ greenhouse gas emissions using emissions data for the headquarters and subsidiaries of the world’s biggest manufacturing, energy, and utility companies. Our results suggest that financial incentives and legal requirements to audit energy use reduce companies’ emissions, whereas support schemes aimed at promoting the combined generation of heat and power increased emissions of non-utility companies and feed-in tariffs aimed at increasing the use of renewable energy sources for electricity generation increase emissions of utility companies. We also find loans and subsidies for energy efficiency improvements to increase emissions in the short term. In addition, our results provide a solid foundation for researchers seeking consistent and comparable estimates on the mitigation effects of typical climate policy instruments in a cross-country setting. |
| Keywords: | climate policy evaluation, greenhouse gas emissions, cross-country micro panel data, companies, firms |
| JEL: | H23 H32 Q42 Q48 Q54 Q58 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6651&r=ene |
| By: | Dominik Wiedenhofer; Dabo Guan; Zhu Liu; Jing Meng; Zhang, Ning; Wei, Yi-Ming |
| URL: | http://d.repec.org/n?u=RePEc:qsh:wpaper:512821&r=ene |
| By: | Mario Larch; Markus Löning; Joschka Wanner |
| Abstract: | Unilateral climate policy suffers from carbon leakage, i.e. the (partial) offset of the initial emission reduction by increases in other countries. Different than most typically discussed climate policies, degrowth not only aims at reducing the fossil fuel use in an economy, but rather at a reduction of all factor inputs, which may lead to different leakage implications. We conduct the first investigation of degrowth in a multi-country setting in order to (i) compare the leakage effects of national pure emission reduction policies to degrowth scenarios, (ii) identify underlying channels by decomposing the implied emission changes into scale, composition, and technique effects, and (iii) investigate which country characteristics determine degrowth’s relative effectiveness to overcome the leakage problem. Using a structural gravity model, we find that degrowth indeed significantly reduces leakage by keeping the sectoral composition of the country more stable and reducing uncommitted countries’ incentives to shift towards more energy-intensive production techniques. The higher effectiveness of degrowth in reducing carbon emissions is most pronounced for small and trade-open economies with comparatively clean production technologies. |
| Keywords: | degrowth, climate policy, gravity model, carbon leakage |
| JEL: | F18 Q54 Q57 |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6633&r=ene |
| By: | Mike Farjam (Department of Social Studies, Linnaeus University, Växjö Sweden; and Linnaeus University Centre for Data Intensive Sciences & Applications (DISA@LNU), Växjö Sweden); Olexandr Nikolaychuk (Faculty of Economics and Business Administration, Friedrich Schiller University, Jena, Germany); Giangiacomo Bravo (Department of Social Studies, Linnaeus University, Växjö Sweden; and Linnaeus University Centre for Data Intensive Sciences & Applications (DISA@LNU), Växjö Sweden) |
| Abstract: | Effective communication of risks involved in the climate change discussion is crucial and despite ambitious protection policies, the possibility of irreversible consequences actually occurring can only be diminished but never ruled out completely. We present a laboratory experiment that studies how residual risk of failure affects willingness to contribute to climate protection policies. Contrary to our initial hypothesis, we find that the contributions were higher in treatments with residual risk than in treatments without one. We interpret this as an outcome of a psychological process where residual risk puts participants into an "alarm mode", keeping their contributions high. We discuss the broad practical implications this might have on the real world communication of climate change. |
| Keywords: | collective risk social dilemma, climate change mitigation, voluntary contribution, experiment, risk |
| JEL: | D71 Q54 H41 D80 |
| Date: | 2017–10–18 |
| URL: | http://d.repec.org/n?u=RePEc:jrp:jrpwrp:2017-014&r=ene |