nep-ene New Economics Papers
on Energy Economics
Issue of 2018‒01‒29
48 papers chosen by
Roger Fouquet
London School of Economics

  1. The effect of Demand Response and wind generation on electricity investment and operation By Nolan, Sheila; Devine, Mel; Lynch, Muireann A.; O’Malley, Mark
  2. Sunspots that matter: the effect of weather on solar technology adoption By Lamp, Stefan
  3. Designing fair support schemes for renewable electricity By Devine, Mel; Farrell, Niall; Lee, William T
  4. Household investments into solar PV and battery storage: an analysis of profitability and impact By ; Valentin Bertsch, Jutta Geldermann, Tobias Lühn;
  5. Heat or power: how to increase the use of energy wood at the lowest costs? By Vincent Bertrand; Sylvain Caurla; Elodie Le Cadre; Philippe Delacote
  6. Conventional Power Plants in Liberalized Electricity Markets with Renewable Entry By Llobet, Gerard; Padilla, Atilano Jorge
  7. Electricity in Vietnam: where does it come from, how to make it greener ? By Minh Ha-Duong
  8. What is behind mirroring hypothesis? Dynamics between modularity and integration in the market creation: case from electric vehicle industry By Yurong Chen
  9. A multi-regional model of electric resource adequacy By Crampes, Claude; Salant, David
  10. Is electricity affordable and reliable for all in Vietnam? By Minh Ha-Duong; Hoai-Son Nguyen
  11. Swiss Household Energy Demand Survey (SHEDS): Objectives, design, and implementation By Sylvain Weber; Paul Burger; Mehdi Farsi; Adan L. Martinez-Cruz; Michael Puntiroli; Iljana Schubert; Benjamin Volland
  12. Stacking up the ladder: A panel data analysis of Tanzanian household energy choices By Johanna Choumert; Pascale Combes; Leonard Le Roux
  13. Closing the evidence gap: Energy consumption, real output and pollutant emissions in a developing mountainous economy By Rabindra Nepal; Nirash Paija
  14. Relation entre l’énergie et la croissance économique : approche empirique appliquée au cas de Madagascar pour la periode 1995 à 2015 By Andriamanga, Fidimanantsoa
  15. Mobilité : changer d’époque ? By Yves Crozet
  16. Vulnérabilité énergétique et mobilité quotidienne : quelle mesure ? By Damien Verry; Kuscha Dy; Jean-Pierre Nicolas
  17. The quintuple helix model and the future of mobility: The case of autonomous vehicles By Rodrigo Marçal; Ricardo Braga; Fabio Antonialli; Bruna Habib Cavazza; Joel Yutaka Sugano; Cleber Castro; André Luiz Zambalde; Arthur Miranda Neto; Isabelle Nicolaï
  18. Editorial - Household transport costs, economic stress and energy vulnerability By Giulio Mattioli; Jean-Pierre Nicolas; Carsten Gertz
  19. AUTONOMOUS VEHICLES: Scientometric and bibliometric studies By Rodrigo Marçal; Fabio Antonialli; Bruna Habib; Arthur De Miranda Neto; Danilo Alves de Lima; Joel Yutaka; André Luiz; Isabelle Nicolaï
  20. Autonomous Vehicles, are They “Riding” in a Blue Ocean? By Fabio Antonialli; Bruna Habib Cavazza; Rodrigo Marçal Gandia; Isabelle Nicolaï; Arthur De Miranda Neto; Joel Yutaka Sugano; André Luiz Zambalde
  21. The Impact of Energy Prices on Employment and Environmental Performance: Evidence from French Manufacturing Establishments By Giovanni Marin; Francesco Vona
  22. Welfare Costs of Oil Shocks By Amir Yaron; Steffen Hitzemann
  23. Industry Effects of Oil Price Shocks: Re-Examination By Jo, Soojin; Karnizova, Lilia; Reza, Abeer
  24. Evaluation des risques des régimes fiscaux pétroliers By Emmanuel Okamba
  25. The U.S. Shale Oil Boom, the Oil Export Ban, and the Economy: A General Equilibrium Analysis Nida By Cakir Melek, Nida; Plante, Michael D.; Yucel, Mine K.
  26. Implicit probability distribution for WTI options: The Black Scholes vs. the semi-nonparametric approach By Lina M. Cortés; Javier Perote; Andrés Mora-Valencia
  27. Regulation in the presence of adjustment costs and resource scarcity. Transition dynamics and intertemporal effects By Halvor Briseid Storrøsten
  28. Food versus Fuel: An Updated and Expanded Evidence By Ondrej Filip; Karel Janda; Ladislav Kristoufek; David Zilberman
  29. Getting Incentives Right: Human Capital Investment and Natural Resource Booms By Gerhard Toews; Alexander Libman
  30. Regulating Mismeasured Pollution: Implications of Firm Heterogeneity for Environmental Policy By Eva Lyubich; Joseph S. Shapiro; Reed Walker
  31. Carbon Tax Saliency: The Case of B.C. Diesel Demand By Jean-Thomas Bernard; Maral Kichian
  32. Ready for a Carbon Tax? An Explorative Analysis of University Students’ Preferences By Lucia Rotaris
  33. The efficient combination of taxes on fuel and vehicles By Geir H. M. Bjertnæs
  34. A Theory of Gains from Trade in Multilaterally Linked ETSs By Baran Doda; Simon Quemin; Luca Taschini
  35. Assessing the implementation of the Market Stability Reserve By Corinne Chaton; Anna Creti; Maria-Eugenia Sanin
  36. Pricing Carbon Emissions in China By Chia-Lin Chang; Te-Ke Mai; Michael McAleer
  37. Measuring Inventive Performance with Patent Data: an Application to Low Carbon Energy Technologies By Clément Bonnet
  38. Linking Heterogeneous Climate Policies (Consistent with the Paris Agreement) By Michael A. Mehling; Gilbert E. Metcalf; Robert N. Stavins
  39. Framing policy on low emissions vehicles in terms of economic gains: might the most straightforward gain be delivered by supply chain activity to support refuelling? By Alabi Oluwafisayo; Martin Smith; John Irvine; Karen Turner
  40. Trade in Environmental Goods: Empirical Exploration of Direct and Indirect Effects on Pollution by Country’s Trade Status By Natalia Zugravu-Soilita
  41. Verteilungsprobleme und Ineffizienz in der Klimapolitik By Bardt, Hubertus; Schaefer, Thilo
  42. Can the Paris Deal Boost SDGs Achievement? An Assessment of Climate Mitigation Co-benefits or Side-effects on Poverty and Inequality By Lorenza Campagnolo; Marinella Davide
  43. Project-Based Carbon Contracts: A Way to Finance Innovative Low-Carbon Investments By Jörn Richstein
  44. Datasets on technological GHG emissions mitigation options for the agriculture sector By Iria Soto; Berta Sanchez Fernandez; Manuel Gomez Barbero; Thomas Fellmann; Emilio Rodriguez Cerezo
  45. Quantifying Non-cooperative Climate Engineering By Johannes Emmerling; Massimo Tavoni
  46. Optimal Carbon Dioxide Removal in Face of Ocean Carbon Sink Feedback By Vassiliki Manoussi; Soheil Shayegh; Massimo Tavoni
  47. Capturing industrial CO2 emissions in spain: infrastructures, costs and brek-even prices By Olivier Massol; Stéphane Tchung-Ming; Albert Banal-Estanol
  48. The Role of Carbon Capture and Storage Electricity in Attaining 1.5 and 2°C By Adriano Vinca; Marianna Rottoli; Giacomo Marangoni; Massimo Tavoni

  1. By: Nolan, Sheila; Devine, Mel; Lynch, Muireann A.; O’Malley, Mark
    Date: 2017–12
  2. By: Lamp, Stefan
    Abstract: This paper tests for the effect of weather on solar technology adoption, taking advantage of the fact that sunshine is a direct input factor for solar electricity production. I find that a one standard deviation increase in monthly sunshine hours above the long-term average leads to an approximate 6.2 % growth in the residential solar market over a six-month period. I consider a range of potential mechanisms and find strong evidence for projection bias and salience as key drivers of my results. My findings show that there is an asymmetric response to positive and negative sunshine deviations from the long-term mean and that counties with a high vote share for the green party are particularly affected by these biases.
    Keywords: projection bias; salience; technology diffusion; solar technology; energy policy
    JEL: D12 D91 Q42
    Date: 2018–01
  3. By: Devine, Mel; Farrell, Niall; Lee, William T
    Date: 2017
  4. By: ; Valentin Bertsch, Jutta Geldermann, Tobias Lühn;
    Date: 2017
  5. By: Vincent Bertrand; Sylvain Caurla; Elodie Le Cadre; Philippe Delacote
    Abstract: We compute the optimal subsidy level to fuelwood consumption that makes it possible to achieve the French biomass energy consumption target. In this view, we model the competitions and trade-offs between the consumption of fuelwood for heat (FW-H) and the consumption of fuelwood for power generation (FW-E). To do so, we couple a forest sector model with an electricity simulation model and we test different scenarios combining FWH and FW-E that account for contrasted potential rise in carbon price and potential reduction in the number of nuclear plants. We assess the implications of these scenarios on (1) the budgetary costs for the Government, (2) the industrial wood producers’ profits, (3) the costs savings in power sector for the different scenarios tested and (4) the carbon balance. We show that the scenario with the highest carbon price and the lowest number of nuclear plants is the less expensive from a budgetary perspective. Indeed, when associated with a high carbon price, co-firing may increase FW-E demand with lower subsidy level, which enables reducing the cost of reaching the target. However, in this case, FW-E crowds-out part of FW-H which may cause political economy issues. From a carbon balance perspective, a FW-H only scenario better performs than any other scenario that combines FW-H and FW-E due to the relatively low emissions factors of alternative technologies for electricity generation, in particular nuclear energy.
    Keywords: Forestry sector, Bioenergy, Biomass-based electricity, Carbon pricing, Nuclear power
    Date: 2017
  6. By: Llobet, Gerard; Padilla, Atilano Jorge
    Abstract: This paper examines the optimal capacity choices of conventional power generators after the introduction of renewable production. We start with a basic and generally accepted model of the liberalized wholesale electricity market in which firms have insufficient incentives to invest and we illustrate how the entry of renewable generation tends to aggravate that problem. We show that the incentives to invest in firm capacity (e.g. conventional thermal plants) may be restored by means of a capacity auction mechanism. That mechanism is vulnerable and, hence, may prove ineffective unless governments can credibly commit not to sponsor the entry of new capacity outside the auction mechanism. We explain that such commitment may be particularly difficult in the current political context where energy policy is conditioned by environmental and industrial-policy goals. We finally propose a way to enhance the credibility of capacity auctions by committing to optimally retire idle (conventional) power plants in response to entry outside the auction.
    Keywords: Capacity Payments; Conventional Generation; Environmental Goals; Missing-Money Problem; Renewable Energy; Security of Supply
    JEL: L51 L94
    Date: 2018–01
  7. By: Minh Ha-Duong (CleanED - Clean Energy and Sustainable Development Lab - USTH - University of sciences and technologies of hanoi, CIRED - Centre International de Recherche sur l'Environnement et le Développement - CNRS - Centre National de la Recherche Scientifique - ENPC - École des Ponts ParisTech - AgroParisTech - EHESS - École des hautes études en sciences sociales - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement)
    Keywords: electricity, electricity production
    Date: 2017–08–04
  8. By: Yurong Chen (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec)
    Date: 2017–08–04
  9. By: Crampes, Claude; Salant, David
    Abstract: The paper analyzes the determinants of optimal electric capacity and contrasts these with the requirements typically applied in a multi-regional model. We first analyze the relationship between usual reliability criteria such as the value of lost load and the targeted probability of failure, on the one hand, and the conditions that define optimal level of capacity on the other. Secondly, we characterize the social gains from energy trading between two interconnected regions that differ in terms of technologies or demand. Market mechanisms are sufficient to reach the first best allocation, irrespective of the correlation between national demand levels, provided that firms have no market power and fully internalize the value of lost load due to power rationing when supplies are inadequate. Thirdly, we explain the impact of various compensation mechanisms such as capacity payments when producers face a regulatory capacity constraint.
    Keywords: Capacity adequacy; Electricity trade; Capacity adequacy; Capacity credits; Cooperation; Value of loss load
    JEL: D44 F10 H57 L51 L94
    Date: 2018–01
  10. By: Minh Ha-Duong (CIRED - Centre International de Recherche sur l'Environnement et le Développement - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Hoai-Son Nguyen (ABIèS - Ecole doctorale - INA P-G - Institut National Agronomique Paris-Grignon, CleanED - Clean Energy and Sustainable Development Lab - USTH - University of sciences and technologies of hanoi, CIRED - Centre International de Recherche sur l'Environnement et le Développement - CIRAD - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Access to clean and affordable energy for all is the seventh sustainable development goal. This manuscript examines the state of access to electricity for all in Vietnam, based on national households surveys conducted in the time period 2008-2014. Our theoretical contribution to debates on energy poverty is to account for the human dimension by using an self-reported satisfaction indicator. We argue that subjective energy poverty indicators –designed from surveys asking people if they had enough electricity to meet their households needs– are as relevant as objective indicators –from engineering or economic data. While objectivity is laudable, development is not only about technology and money: measuring human satisfaction matters. We find that in Vietnam, the problem of providing access to clean energy for all is largely solved for now: the fraction of households without access to electricity is below two percent, the median level of electricity usage in 2014 was 100 kWh per month per household, and the fraction of households declaring unsatisfied electricity needs is below three percent. We also find that electricity is becoming a heavier burden in Vietnamese households’ finances. In 2010, the electricity bill exceeded 6% of income for 2.4% of households, but in 2014 that number reached 5.5% of households. Electricity is affordable for all in Vietnam today, but this could be compromised if electricity tariffs increase in order to finance further clean development of the energy system. We quantify how this problem could be attenuated by making the retail tariff of electricity much more progressive. We define a more progressive block tariff that provides free access to 30 kWh basic need per household, while increasing the cost for other blocks. This could increases the revenue for EVN by 15% and at the same time decrease the electricity bill for the 28% of households who use less than 80 kWh per month.
    Keywords: sustainable development goal,electricity,Vietnam,Indicators of sustainable development
    Date: 2017–08–01
  11. By: Sylvain Weber; Paul Burger; Mehdi Farsi; Adan L. Martinez-Cruz; Michael Puntiroli; Iljana Schubert; Benjamin Volland
    Abstract: The Swiss Household Energy Demand Survey (SHEDS) has been developed as part of the research agenda of the Competence Center for Research in Energy, Society, and Transition (SCCER CREST). It is designed to collect a comprehensive description of the Swiss households' energy-related behaviors, their longitudinal changes and the existing potentials for future energy demand reduction. The survey has been planned in five annual waves thus generating a rolling panel dataset of 5,000 respondents per wave. The first two waves of SHEDS were fielded in April 2016 and April-May 2017. This paper elaborates on SHEDS's general objectives, design, and implementation. It also reports a series of practical examples of how the datasets are being used in empirical analyses.
    Keywords: energy, longitudinal survey, Switzerland.
    JEL: Q40 C80
    Date: 2017–10
  12. By: Johanna Choumert (EDI - Economic Development Initiatives Limited); Pascale Combes (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique); Leonard Le Roux (University of Cape Town)
    Abstract: Energy-use statistics in Tanzania reflect the country’s low level of industrialization and development. In 2016, only 16.9% of rural and 65.3% of urban inhabitants in mainland Tanzania were connected to some form of electricity. We use a nationally representative three-wave panel dataset (2008-2013) to contribute to the literature on household energy use decisions in Tanzania in the context of the stacking and energy ladder hypotheses. We firstly adopt a panel multinomial-logit approach to model the determinants of household cooking- and lighting-fuel choices. Secondly, we focus explicitly on energy stacking behaviour, proposing various ways of measuring what is inferred when stacking behaviour is thought of in the context of the energy transition and presenting household level correlates of energy stacking behaviour. Thirdly, since fuel uses have gender-differentiated impacts, we investigate women’s bargaining power in the decision-making process of household fuel choices. We find that whilst higher household incomes are strongly associated with a transition towards the adoption of more modern fuels, especially lighting fuels, this transition takes place in a context of significant fuel stacking. In Tanzania, government policy has been aimed mostly at connecting households to the electric grid. However, the public health, environmental and social benefits of access to modern energy sources are likely to be diminished in a context of significant fuel stacking. Lastly, we present evidence that the educational attainment of women in the household is an important aspect of household fuel choices.
    Keywords: Fuel choices, Intra-household bargaining, Sub-Saharan Africa
    Date: 2018–01–08
  13. By: Rabindra Nepal; Nirash Paija
    Abstract: This study examines the inter relationships between energy consumption, output and carbon emissions in a mountainous economy using an augmented Vector Autoregression model. Time-series data over the period 1975-2013 is studied applying a multivariate framework using population and gross fixed capital formation as additional variables for Nepal. We control for the presence of structural breaks, autoregressive conditional heterosdeacticity and serial correlation in our analysis. Testing for Granger causality between integrated variables based on asymptotic theory reveals a long-run unidirectional Granger causality running from GDP to energy consumption, and a unidirectional Granger causality running from carbon emissions to GDP. The results indicate that energy consumption does not lead to economic growth while income leads to energy consumption. We suggest that the government of Nepal can adopt energy conservation policies and energy efficiency improvements to narrow the energy supply-demand gap. However, environmental policies aimed at reducing air pollution may have adverse effects on the growth of the Nepalese economy, which calls for a gradual approach towards decarbonisation. Our results remain robust to different estimators and contributes to an emerging literature on the nexus relationships between energy consumption, income and carbon emissions in developing economies.
    Keywords: economic growth, granger causality, energy consumption, carbon emissions
    JEL: C32 O55 Q20 Q43
    Date: 2018–01
  14. By: Andriamanga, Fidimanantsoa
    Abstract: With increasing energy needs and a continuous rise in hydrocarbon prices, this work aims to evaluate the link between energy and the economy in Madagascar. The enhancement of these links improves the socio-economic impacts of energy policies: what should contribute to development. Electricity, hydrocarbon and GDP are linked by cointegration equations in the short and long term. In the long term, these three variables tend to evolve together and in the case of short-term variation, there is a very strong restoring force that brings the equation back to equilibrium. This characteristic of Madagascar's economy presents a part of the underdevelopment, of the inoperability of various productive resources available. But also because of a long period of insufficient energy production: which contributed to the weakening of the economy. But this study show that : an investment in the energy sector has a direct impact on the standard of living in general, with proportions higher than all other variables in the short term.
    Keywords: Energy, Electricity, Hydrocarbon, Economic Growth, ECM Econometric Model, Error Correction Model
    JEL: C3 C51 Q43 Q48
    Date: 2017–11–24
  15. By: Yves Crozet (LET - Laboratoire d'économie des transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Le changement d’époque n’est pas celui que l’on croit. L’opportunité de nouvelles mobilités routières se fait jour, mais sous de fortes contraintes. L’idée que nous changeons d’époque a été beaucoup développée à la fin de l’année 2015 lors de la COP21. La notion de transition écologique et énergétique s’inscrit dans la même logique, en rappelant les contraintes liées à un « monde fini ». La mobilité est interpellée dans la mesure où elle est à l’origine d’émissions de gaz à effet de serre et des diverses nuisances que constituent l’insécurité, la pollution de l’air, le bruit, etc. Ces défis sont connus depuis longtemps. Ils étaient déjà abordés en 1982 dans la LOTI, en 1996 dans la loi LAURE ou en 2000 dans la loi SRU qui ont, entre autres, instauré les plans de déplacements urbains (PDU). Qu’y a-t-il de nouveau depuis, en quoi serait-on en train de changer d’époque ?
    Keywords: mobilités routières,Mobilité durable,Report modal
    Date: 2016
  16. By: Damien Verry (Cerema Direction Territoires et Ville - Centre d'Etudes et d'Expertise sur les Risques, l'Environnement, la Mobilité et l'Aménagement - Direction Territoires et Ville - Cerema - Centre d'Etudes et d'Expertise sur les Risques, l'Environnement, la Mobilité et l'Aménagement); Kuscha Dy (Cerema - Centre d'Etudes et d'Expertise sur les Risques, l'Environnement, la Mobilité et l'Aménagement); Jean-Pierre Nicolas (LAET - Laboratoire Aménagement Économie Transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Cet article traite de la mesure de la vulnérabilité énergétique des ménages telle que la met en évidence l’enquête performance de l’habitat, équipements, besoins et usages de l’énergie (Phébus). Il se concentre d’abord sur la validation de ce que l’enquête peut apporter en matière de vulnérabilité liée aux mobilités quotidiennes en s’attachant à montrer la difficulté à prendre en compte les possibilités d’adaptations et les éventuelles privations des ménages dans ce domaine. Il explore ensuite les caractéristiques des ménages sensibles aux prix de l’énergie tout à la fois dans leur logement et pour leurs déplacements, pour montrer que cette double vulnérabilité est liée à des situations spécifiques que des analyses sur les vulnérabilités logement ou mobilité pris séparément ne révèlent pas.
    Keywords: Vulnérabilité énergétique,mobilité quotidienne,enquête Phébus,Mobilité des ménages
    Date: 2017
  17. By: Rodrigo Marçal (UFLA - Universidade Federal de Lavras); Ricardo Braga (UFLA - Universidade Federal de Lavras); Fabio Antonialli (UFLA - Universidade Federal de Lavras, LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Bruna Habib Cavazza (UFLA - Universidade Federal de Lavras, LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Joel Yutaka Sugano (UFLA - Universidade Federal de Lavras); Cleber Castro (UFLA - Universidade Federal de Lavras); André Luiz Zambalde (UFLA - Universidade Federal de Lavras); Arthur Miranda Neto (UFLA - Universidade Federal de Lavras); Isabelle Nicolaï (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec)
    Date: 2017–06–14
  18. By: Giulio Mattioli (University of Leeds); Jean-Pierre Nicolas (LAET - Laboratoire Aménagement Économie Transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique); Carsten Gertz (Technische Universität Hamburg-Harburg)
    Abstract: Since the early 2000s issues of transport poverty and social exclusion have received increasing attention in transport studies (Dodson et al., 2004; Hine and Mitchell, 2001; Lucas et al., 2001). Although much of this research has focused on low-mobility and/or carless individuals, there has been growing awareness that the costs of daily mobility can have important economic stress impacts. In developed countries with high levels of car dependence, the costs of motoring can be burdensome, raising questions of affordability for households with limited economic resources. A number of developments in the first two decades of this century have contributed to raise the profile of household transport costs as a research topic and a policy concern. First, and more obviously, increasing and increasingly volatile global oil prices have raised concerns for the vulnerability of households to fuel price increases (Dodson and Sipe, 2007). Second, the rise of the climate change agenda has led to consider pricing measures as a key component of sustainable transport policy. Implementation of such measures however, has often been hampered by concerns for the distributional impacts of increasing transport costs faced by households. Third, the global financial crisis of 2007–2008 and its aftermath have highlighted broader issues of living standards, economic stress and affordability, which go beyond the specific case of transport. In this context, a further reason to investigate household transport costs has to do with other competing pressures on household budgets.
    Keywords: Household transport costs,Household budgets,Competing pressures
    Date: 2018
  19. By: Rodrigo Marçal (UFLA - Universidade Federal de Lavras); Fabio Antonialli (UFLA - Universidade Federal de Lavras, LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Bruna Habib (UFLA - Universidade Federal de Lavras, LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Arthur De Miranda Neto (UFLA - Universidade Federal de Lavras); Danilo Alves de Lima (UFLA - Universidade Federal de Lavras); Joel Yutaka (UFLA - Universidade Federal de Lavras); André Luiz (UFLA - Universidade Federal de Lavras); Isabelle Nicolaï (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec)
    Date: 2017–06–14
  20. By: Fabio Antonialli (UFLA - Universidade Federal de Lavras, LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Bruna Habib Cavazza (UFLA - Universidade Federal de Lavras, LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Rodrigo Marçal Gandia (UFLA - Universidade Federal de Lavras); Isabelle Nicolaï (LGI - Laboratoire Génie Industriel - EA 2606 - CentraleSupélec); Arthur De Miranda Neto (Heudiasyc - Heuristique et Diagnostic des Systèmes Complexes [Compiègne] - CNRS - Centre National de la Recherche Scientifique, UFLA - Universidade Federal de Lavras); Joel Yutaka Sugano (UFLA - Universidade Federal de Lavras); André Luiz Zambalde (UFLA - Universidade Federal de Lavras)
    Abstract: This paper aims at identifying the adherences of the propositions of Autonomous Vehicles (AVs) over Traditional Vehicles (TradVs) by using the theoretical models of the blue ocean's strategy four-action framework and value curve (Kim & Mauborgne, 2005) and disruptive innovation (Christensen, 1997). Specifically, it aims at drawing new value curves for AVs over TradVs when considering AVs as a service and as a product. As for methodology, this study is classified as qualitative, empirical and descriptive with data collection via open questionnaires with AVs specialists in France, Belgium and Brazil and analyzed by content analysis (Bardin, 2010). The results point to the arrival of a " new " vehicle concept that includes: different ownership forms; free time for users (no driving required); " infotainment " ; social integration of elder and handicapped people; in all, factors that will cause the extinction of some markets and creation of others. The AVs' value curves present different characteristics when compared to TradVs', in a sense that the main elements to be reduced are: human intervention; ownership; related services and accidents. The elements to be eliminated (in higher automation levels) are: car components like steering-wheel and pedals; rear-view mirrors; driver's license need; driver's liability as well as the fact that driving sensations and driver's control over the vehicle tend to disappear. It is also discussed about the vehicle's business environment and related services that might fade away, such as: car dealerships, driving schools and gas stations. On the other hand, aspects such as: comfort, relaxation, driving fluidity and timing efficiency will be raised as well as there will be seen the creation of a new use of the time, reconfiguration of the design and the mobility for other audiences.
    Keywords: Autonomous Vehicles,Value Curve,Four-action Framework,Disruptive Innovation,Blue Ocean Strategy
    Date: 2017–09–21
  21. By: Giovanni Marin (University of Urbino ‘Carlo Bo' and SEEDS); Francesco Vona (OFCE-SciencesPo and SKEMA Business School)
    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 percent increase in energy prices brings about a 6 percent reduction in energy consumption and an 11 percent reduction in CO2 emissions, such an increase also has a modestly negative impact on employment (-2.6 percent) 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-establishment firms by labor reallocation across establishments.
    Keywords: Energy Prices, Establishment Performance, Environmental and Energy Policy
    JEL: Q52 Q48 H23 D22
    Date: 2017–12
  22. By: Amir Yaron (University of Pennsylvania); Steffen Hitzemann (The Ohio State University)
    Abstract: This paper investigates the costs of oil shocks for the economy's welfare. Using a VECM, we empirically show that domestic US oil production shocks only have a weak and temporary impact on macroeconomic variables, while the effect of global oil price shocks is persistent and economically and statistically significant. We rationalize these findings within a calibrated two-sector model in which oil is an input factor for industrial production and also part of the household's consumption bundle. Based on the model, we show that oil shocks are associated with large welfare costs for oil-importing economies. Our framework enables several experiments regarding the welfare implications of a reduced oil share in production and consumption, the strategic petroleum reserve, and technological innovations such as fracking.
    Date: 2017
  23. By: Jo, Soojin (Federal Reserve Bank of Dallas); Karnizova, Lilia (University of Ottawa); Reza, Abeer (Bank of Canada)
    Abstract: Sectoral responses to oil price shocks help determine how these shocks are transmitted through the economy. Textbook treatments of oil price shocks often emphasize negative supply effects on oil importing countries. By contrast, the seminal contribution of Lee and Ni (2002) has shown that almost all U.S. industries experience oil price shocks largely through a reduction in their respective demands. Only industries with very high oil intensities face a supply-driven reduction. In this paper, we re-examine this seminal findings using two additional decades of data. Further, we apply updated empirical methods, including structural factor-augmented vector autoregressions, that take into account how industries are linked among themselves and with the remainder of the macro-economy. Our results confirm the original finding of Lee and Ni that demand effects of oil price shocks dominate in all but a handful of U.S. industries.
    Keywords: oil price shocks; SVAR; FAVAR; industry supply and demand
    JEL: E30 Q43
    Date: 2017–07–31
  24. By: Emmanuel Okamba (IRG - Institut de Recherche en Gestion - UPEM - Université Paris-Est Marne-la-Vallée - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12)
    Abstract: Les contrats pétroliers entre l'Etat et les entreprises pétrolières exposent la trésorerie publique à un manque à gagner, lié au risque systémique ou à la volatilité des prix sur les marchés du pétrole, et au risque opérationnel lié aux comportements opportunistes des agents. La faible traçabilité de l'information fiscale pétrolière qui en résulte, affaiblie le reporting comptable et financier entre les parties qui ne peuvent obtenir des gains optimaux et doivent se contenter des gains satisfaisants.
    Keywords: Régime fiscal,Contrat pétrolier,Asymetrie informationnelle,Comportement oportuniste,Risque
    Date: 2017–09–21
  25. By: Cakir Melek, Nida (Federal Reserve Bank of Kansas City); Plante, Michael D.; Yucel, Mine K.
    Abstract: This paper examines the e ects of the U.S. shale oil boom in a two-country DSGE model where countries produce crude oil, re ned oil products, and a non-oil good. The model in- {{p}} corporates di erent types of crude oil that are imperfect substitutes for each other as inputs into the re ning sector. The model is calibrated to match oil market and macroeconomic data for the U.S. and the rest of the world (ROW). {{p}} We investigate the implications of a signicant {{p}} increase in U.S. light crude oil production similar to the shale oil boom. Consistent with the data, our model predicts that light oil prices decline, U.S. imports of light oil fall dramatically, and light oil crowds out the use of medium crude by U.S. re ners. In addition, fuel prices fall and U.S. GDP rises. We then use our model to examine the potential implications of the former U.S. crude oil export ban. The model predicts that the ban was a binding constraint in 2013 through 2015. We find that the distortions introduced by the policy are greatest in the {{p}} re ning sector. Light oil prices become arti cially low in the U.S., and U.S. re neries produce ineciently high amount of re ned products, but the impact on re ned product prices and GDP are negligible.
    Keywords: DSGE; Oil; Trade; Fuel prices; Export ban
    JEL: F41 Q38 Q43
    Date: 2017–09–01
  26. By: Lina M. Cortés; Javier Perote; Andrés Mora-Valencia
    Abstract: This paper contributes to the literature on the estimation of the Risk Neutral Density (RND) function by modeling the prices of options for West Texas Intermediate (WTI) crude oil that were traded in the period between January 2016 and January 2017. For these series we extract the implicit RND in the option prices by applying the traditional Black & Scholes (1973) model and the semi-nonparametric (SNP) model proposed by Backus, Foresi, Li, & Wu (1997). The results obtained show that when the average market price is compared to the average theoretical price, the lognormal specification tends to systematically undervalue the estimation. On the contrary, the SNP option pricing model, which explicitly adjust for negative skewness and excess kurtosis, results in markedly improved accuracy.
    Keywords: Oil prices, option pricing, risk neutral density, semi-nonparametric approach
    Date: 2017–12–05
  27. By: Halvor Briseid Storrøsten (Statistics Norway)
    Abstract: This paper examines regulation in the presence of adjustment costs and resource scarcity, allowing for imperfectly informed firms. I find strong evidence that announcement of future environmental regulation will reduce current emissions in the combined presence of resource scarcity and adjustment costs. This contrasts with the results in the literature on the green paradox. Further, efficient transition towards a low emission economy requires an investment tax on emission intensive production, unless firms have perfect information about the future. Moreover, investments in clean substitutes should first receive a subsidy, but may thereafter be taxed. The optimal tax on production differs from the Pigouvian tax in the case of scarce resources. Last, a uniform tax across heterogeneous agents can induce the socially optimal outcome only if firms have equal expectations about the future.
    Keywords: regulation; adjustment cost; imperfect information; exhaustible resources; climate change
    JEL: H21 H23 Q41 Q54
    Date: 2017–09
  28. By: Ondrej Filip (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic); Karel Janda (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic; Dept. of Banking and Insurance, Faculty of Finance and Accounting, University of Economics, Namesti Winstona Churchilla 4, 130 67 Prague, Czech Republic); Ladislav Kristoufek (Institute of Economic Studies, Faculty of Social Sciences, Charles University in Prague, Smetanovo nabrezi 6, 111 01 Prague 1, Czech Republic); David Zilberman (Department of Agricultural and Resource Economics, University of California, 207 Giannini Hall, Berkeley, CA 94720, USA)
    Abstract: This paper replicates and extends the study of Zhang et al. (2010): „Food versus fuel: What do prices tell us?" Energy Policy 38, pp. 445-451. We confirm the findings of the original paper that there was only a weak relationship between ethanol and food commodities in the period between March 1989 and July 2008. In addition, we extend that study and examine the cointegration relationship between biofuels and related commodities for a considerably enlarged dataset (3 vs. 1 market, 26 vs. 8 commodities, analysis up till 2017 vs. 2008, weekly vs. monthly data frequency). Focusing on the biofuel markets of Brazil, the EU and the USA in the three separate periods before, during, and after the food crisis of 2007 and 2008, we show that studying the time variation of the relationships plays an essential role in their proper understanding. Our results help to clarify the wide extensive discussion about the role of biofuels prices in food shortages manifested particularly during the food crises. In agreement with the original study, we confirm that price series data do not support strong statements about biofuels uniformly serving as main leading source of high food prices and consequently the food shortages.
    Keywords: biofuels; fuels; food; cointegration
    JEL: Q16 Q42 Q56
    Date: 2017–11
  29. By: Gerhard Toews; Alexander Libman
    Abstract: The accumulation of human capital is usually considered an important corner stone in a country’s economic development. While the use of resource rents to improve an educational system and, thus, increase the level of human capital appears to be an attractive option, resource rich economies frequently struggle with an efficient management of resource revenues. In this paper, we ask whether private individuals can at least partly compensate for government’s failures by analysing the consequences of a resource boom on private demand for education. To do this we use the Household Budget Survey of Kazakhstan covering the period of 2001–2005. The oil boom provides us with the necessary exogenous variation to establish causality. We show that, in resource-rich districts of Kazakhstan, the resource boom increases the probability of employment in the formal sector for the educated labour force and the likelihood that households pay tuition fees for tertiary education. We are able to refute the conjecture that our effect is driven merely by the growing income of the households, by the growing supply of educational opportunities or by the immigration of educated households.
    Keywords: Resource Booms, Education
    JEL: Q33 I25
    Date: 2017–10
  30. By: Eva Lyubich (UC Berkeley); Joseph S. Shapiro (Cowles Foundation, Yale University); Reed Walker (University of California, Berkeley, IZA, & NBER)
    Abstract: This paper provides the first estimates of within-industry heterogeneity in energy and CO2 productivity for the entire U.S. manufacturing sector. We measure energy and CO2 productivity as output per dollar energy input or per ton CO2 emitted. Three findings emerge. First, within narrowly de ned industries, heterogeneity in energy and CO2 productivity across plants is enormous. Second, heterogeneity in energy and CO2 productivity exceeds heterogeneity in most other productivity measures, like labor or total factor productivity. Third, heterogeneity in energy and CO2 productivity has important implications for environmental policies targeting industries rather than plants, including technology standards and carbon border adjustments.
    JEL: F18 H23 Q56
    Date: 2018–01
  31. By: Jean-Thomas Bernard (Department of Economics, University of Ottawa, Ottawa, ON); Maral Kichian (Graduate School of Public and International Affairs, University of Ottawa, Ottawa, ON)
    Abstract: In 2008, the government of the province of British Columbia broke new ground in North America by introducing a revenue-neutral carbon tax on fossil fuels. The initial rate was set at $10/ton of CO2 which was then increased annually by $5 increments to reach $30/ton in 2012. We focus on monthly diesel use which is mostly related to commercial activities. Our objective is to measure user reaction to the new tax. Exploiting the sample time series properties, we study the long run reaction via a cointegration equation, linking diesel use, its total price, and income, and the short run reaction using an error correction model (ECM). Carbon tax saliency is interpreted as a short run phenomenon that shows up in the dynamic adjustment of the ECM. We find that the long run total price elasticity estimate of diesel demand is -0.52 and that the short run tax saliency effect is statistically significant. However, the total reaction is small relative to Canada’s commitment to decrease GHG emissions by 30% in 2030 relative to 2005 levels.
    Keywords: diesel demand, carbon tax, tax saliency.
    JEL: Q41 Q58 H23
    Date: 2017
  32. By: Lucia Rotaris (DEAMS, University of Trieste)
    Abstract: Greenhouse gases emissions are inexorably rising worldwide and the frequency and disruptive power of extreme weather phenomena are dramatically increasing. Although command-and-control and regulation policies have been extensively used to mitigate climate change, more effective and potentially efficient policies are needed to curb the negative externalities produced by human activities. A carbon tax could make the case, but is seldom implemented due to its assumed political unpopularity. In order to estimate the acceptability and the willingness to pay (WTP) for a carbon tax, a contingent valuation experiment was administered in USA and in Italy to a sample of 150 university students. The research is innovative both for the topic chosen, since there are no studies testing the WTP for a carbon tax in the Italian context nor comparing it with the estimates obtained for other countries, and for the methodology used to estimate the WTP, making use of random parameters logit models to obtain individual specific estimates of the median WTP. The results show that the median WTP ranges between a minimum of $161 and a maximum of $242, and varies according to the purposes proposed for the tax revenue use, the respondents’ beliefs and knowledge about climate change, and some sociodemographic characteristics of the respondents (age, gender, and political affiliation). The students’ preferences seem to be quite similar when the nationality of the respondents is taken into account.
    Keywords: Carbon Tax, Willingness to Pay, University Students, Climate Change
    JEL: H31 Q58
    Date: 2017–12
  33. By: Geir H. M. Bjertnæs (Statistics Norway)
    Abstract: A tax on fuel combined with tax-exemptions or subsidies for purchase of fuel-efficient vehicles is implemented in many countries to reduce greenhouse gas emissions and other negative externalities from road traffic. This study, however, shows that a tax on fuel should be combined with heavier taxation of fuel-efficient vehicles to curb externalities from road traffic. The tax on fuel is implemented to curb externalities linked to both consumption of fuel and road use. The heavier tax on fuel-efficient vehicles prevents that motorists avoid the road user charge on fuel by purchasing fuel-efficient vehicles.
    Keywords: Transportation; optimal taxation; environmental taxation; global warming
    JEL: H2 H21 H23 Q58 R48
    Date: 2017–10
  34. By: Baran Doda; Simon Quemin; Luca Taschini
    Abstract: Linkages between emissions trading systems (ETSs) have an important role to play in the successful, cost-effective implementation of the Paris Agreement. While the theory of bilateral linkages is well established, we know relatively little about the gains from trade in a multilaterally linked system, and less still about how they are shared among jurisdictions participating in the system. We characterize these gains for an arbitrary linkage coalition, show how they can be decomposed into gains in the coalition's internal bilateral linkages, and prove that linkage is superadditive. Our theoretical results imply the global market may not emerge endogenously and a quantitative exercise shows that this concern may have some validity in practice.
    Keywords: International emissions trading systems, Climate change policy, Bilateral linking, Multilateral linking, Global carbon market
    Date: 2017
  35. By: Corinne Chaton; Anna Creti; Maria-Eugenia Sanin
    Abstract: In October 2015 the European Parliament has established a market stability reserve (MSR) in the Phase 4 of the EU-ETS, as part of the 2030 framework for climate policies. In this paper we model the EU-ETS in presence of the Market Stability Reserve (MSR) as it is defined by that decision and investigate the impact that such a measure has in terms of permits price, output production and banking strategies. To do so we build an inter-temporal model in which polluting firms competing in an homogeneous good market are price takers in a permits market and face an uncertain demand. Our main finding is that the MSR succeeds in increasing the permits' price correcting an excess supply (and conversely decreasing it in case of excess demand). However, when the output demand is stochastic, the MSR may alter the arbitrage conditions that determine permits' prices. In some cases which depend on the extend of the demand variation, unintended effects on the price pattern appear. This in turns may adversely affect welfare.
    Keywords: ETS, Market stability reserve, MSR, Banking
    Date: 2017
  36. By: Chia-Lin Chang (Department of Applied Economics, Department of Finance, National Chung Hsing University, Taiwan); Te-Ke Mai (Department of Economics, National Tsing Hua University, Taiwan); Michael McAleer (Department of Finance, Asia University, Taiwan)
    Abstract: The purpose of the paper is to provide a clear mechanism for determining carbon emissions pricing in China as a guide to how carbon emissions might be mitigated to reduce fossil fuel pollution. The Chinese Government has promoted the development of clean energy, including hydroelectric power, wind power, and solar energy generation. In order to involve companies in carbon emissions control, a series of regional and provincial carbon markets have been established since 2013. Since China’s carbon market was established in 2013 and mainly run domestically, and not necessarily using market principles, there has been almost no research on China’s carbon price and volatility. This paper provides an introduction to China’s regional and provincial carbon markets, proposes how to establish a national market for pricing carbon emissions, discusses how and when these markets might be established, how they might perform, and the subsequent prices for China’s regional and national carbon markets. Power generation in manufacturing consumes more than other industries, with more than 40% of total coal consumption. Apart from manufacturing, the northern China heating system also relies on fossil fuels, mainly coal, which causes serious pollution. In order to understand the regional markets well, it is necessary to analyze the energy structure in these regions. Coal is the primary energy source in China, so that provinces that rely heavily on coal receive a greater number of carbon emissions permits from the Chinese Government. In order to establish a national carbon market for China, a detailed analysis of eight important regional markets will be presented. The four largest energy markets, namely Guangdong, Shanghai, Shenzhen and Hubei, traded around 82% of the total volume and 85% of the total value of the seven markets in 2017, as the industry structure of the western area is different from that of the eastern area. The China National Development and Reform Commission has proposed a national carbon market, which can attract investors and companies to participate in carbon emissions trading. This important issue will be investigated in the paper.
    Keywords: Pricing Chinese Carbon Emissions; National Pricing Policy; Energy; Volatility; Energy Finance; Provincial Decisions
    JEL: C22 C58 G12 Q48
    Date: 2018–01–11
  37. By: Clément Bonnet
    Abstract: We estimate an index that measures the quality of the patented inventions related to Low Carbon Energy Technologies (LCETs) and delivered in seven countries during 1980-2010. This quality index is built using a Latent Factor Model (LFM) that synthesizes the information contained in patent documents. We capture a unique measure of patents quality, defined here as the economic value that is imputable to the technological advance resulting from the patented invention. A robust measure of the inventive performance of each country in the LCETs is obtained using the quality index. Several insights are derived from this measure about the technical advantages of countries and the dynamics of technologies' quality.
    Keywords: Patent data, Energy technologies, Latent factor model, Low carbon innovation
    Date: 2017
  38. By: Michael A. Mehling (Massachusetts Institute of Technology); Gilbert E. Metcalf (Tufts University); Robert N. Stavins (Harvard University)
    Abstract: The Paris Agreement has achieved one of two key necessary conditions for ultimate success – a broad base of participation among the countries of the world. But another key necessary condition has yet to be achieved – adequate collective ambition of the individual nationally determined contributions. How can the climate negotiators provide a structure that will include incentives to increase ambition over time? An important part of the answer can be international linkage of regional, national, and subnational policies, that is, formal recognition of emission reductions undertaken in another jurisdiction for the purpose of meeting a Party’s own mitigation objectives. A central challenge is how to facilitate such linkage in the context of the very great heterogeneity that characterizes climate policies along five dimensions – type of policy instrument; level of government jurisdiction; status of that jurisdiction under the Paris Agreement; nature of the policy instrument’s target; and the nature along several dimensions of each Party’s Nationally Determined Contribution. We consider such heterogeneity among policies, and identify which linkages of various combinations of characteristics are feasible; of these, which are most promising; and what accounting mechanisms would make the operation of respective linkages consistent with the Paris Agreement.
    Keywords: Climate Policy, Paris Agreement, Nationally Determined Contributions
    JEL: Q5 Q56
    Date: 2017–12
  39. By: Alabi Oluwafisayo (International Public Policy Institute, University of Strathclyde); Martin Smith (St Andrews Centre for Advanced Materials, University of St Andrews); John Irvine (Barelett School of Environment, University College London); Karen Turner (International Public Policy Institute, University of Strathclyde)
    Abstract: A core theme of the UK Government’s new Industrial Strategy is exploiting opportunities for domestic supply chain development. This extends to a special ‘Automotive Sector Deal’ that focuses on the shift to low emissions vehicles (LEVs). Here attention is on electric vehicle and battery production and innovation. In this paper, we argue that a more straightforward gain in terms of framing policy around potential economic benefits may be made through supply chain activity to support refuelling of battery/hydrogen vehicles. We set this in the context of LEV refuelling supply chains potentially replicating the strength of domestic upstream linkages observed in the UK electricity and/or gas industries. We use input-output multiplier analysis to deconstruct and assess the structure of these supply chains relative to that of more import-intensive petrol and diesel supply. A crucial multiplier result is that for every £1million of spending on electricity (or gas), 8 full-time equivalent jobs are supported throughout the UK. This compares to less than 3 in the case of petrol/diesel supply. Moreover, the importance of service industries becomes apparent, with 67% of indirect and induced supply chain employment to support electricity generation being located in services industries. The comparable figure for GDP is 42%.
    Keywords: electric vehicles, input-output model, multipliers, value-added multiplier, employment multiplier, supply chain development
    JEL: C67 Q42 Q43 Q48 R48
    Date: 2018–01
  40. By: Natalia Zugravu-Soilita (University of Versailles Saint-Quentin-en-Yvelines)
    Abstract: Based on panel data covering 114 countries in the world, this study investigates the direct, indirect and total effects of trade flows in environmental goods (EG) on total CO2 and SO2 emissions. Our system-GMM estimations reveal positive direct scale – [between-industry] composition effects prevailing on the negative direct technique – [within-industry] composition effects (if any), as well as compensating the significant indirect technique effects channelled by the stringency of environmental regulations and per capita income. If the net importers of EGs (namely from the APEC54 and WTO26 lists) are recurrently found to face increased pollution (in particular CO2 emissions) due to direct scale-composition effects of trade in EGs, the EGs’ net exporters are more likely to see their local pollution to decrease, in particular thanks to income-induced effects. We show that the direct, indirect and total effects of trade in EGs depend on the country’s net trade status, the EGs’ classification and the pollutant considered.
    Keywords: Environmental Goods, Environmental Policy, Net Exporter, Net Importer, Pollution, Trade
    JEL: F13 F14 F18 Q53 Q56 Q58
    Date: 2017–12
  41. By: Bardt, Hubertus; Schaefer, Thilo
    Abstract: Deutschland hat sich anspruchsvolle Klimaschutzziele gesetzt und will diese mit möglichst geringen wirtschaftlichen Kosten verwirklichen. Ein höheres Maß an Effizienz wird dann erreicht, wenn die preisgünstigen Maßnahmen zuerst umgesetzt werden, während auf teurere Maßnahmen verzichtet wird. Diese kommen erst dann zum Zuge, wenn die günstigeren Vermeidungspotenziale bereits ausgeschöpft sind.
    Date: 2018
  42. By: Lorenza Campagnolo (Fondazione Eni Enrico Mattei (FEEM)); Marinella Davide (Fondazione Eni Enrico Mattei (FEEM), Harvard University and Ca’ Foscari University)
    Abstract: The paper analyses the synergies and trade-offs between emission reduction policies and sustainable development objectives. Specifically, it provides an ex-ante assessment that the impacts of the Nationally Determined Contributions (NDCs), submitted under the Paris Agreement, will have on the Sustainable Development Goals (SDGs) of poverty eradication (SDG1) and reduced income inequality (SDG10). By combining an empirical analysis with a modelling exercise, the paper estimates the future trends of poverty prevalence and inequality across countries in a reference scenario and under a climate mitigation policy with alternative revenue recycling schemes. Our results suggest that a full implementation of the emission reduction contributions, stated in the NDCs, is projected to slow down the effort to reduce poverty by 2030 (+2% of the population below the poverty line compared to the baseline scenario), especially in countries that have proposed relatively more stringent mitigation targets and suffer higher policy costs. Conversely, countries with a stringent mitigation policy experience a reduction of inequality compared to baseline scenario levels. If financial support for mitigation action in developing countries is provided through an international climate fund, the prevalence of poverty will be slightly reduced at the aggregate level (185,000fewer poor people with respect to the mitigation scenario), but the country-specific effect depends on the relative size of funds flowing to beneficiary countries and on their economic structure.
    Keywords: SDGs, Poverty, Inequality, CGE Model, Mitigation Policy, Paris Agreement
    JEL: C23 C68 Q56
    Date: 2017–09
  43. By: Jörn Richstein
    Abstract: Low and uncertain carbon prices are often stated as a major obstacle for industrial sector investments in technologies to deliver deep emissions reductions. Project-based carbon contracts underwritten by national governments could addressregulatory risk, lower financing costs and strengthen incentives for emission reductions at investment and operation stage. In this paper design options for project-based carbon contracts are assessed using an analytical model capturing risk aversion of investors with a meanvariance utility function. The model is also used to assess how a combination with grant support for innovative projects can minimize overall costs of innovation policy. Savings in financing costs are quantified using a stylized project finance cash flow analysis.
    Keywords: Emission trading systems, carbon contract, innovation support
    JEL: D81 Q48 Q54 Q55 Q58 O38
    Date: 2017
  44. By: Iria Soto (European Commission - JRC); Berta Sanchez Fernandez (European Commission - JRC); Manuel Gomez Barbero (European Commission - JRC); Thomas Fellmann (European Commission - JRC); Emilio Rodriguez Cerezo (European Commission - JRC)
    Abstract: The 2030 EU policy framework for climate and energy confirms that all sectors, including agriculture, should contribute to climate stabilisation and greenhouse gas (GHG) emission reduction in the most cost-effective way. Since 2009, the European Commission's Joint Research Centre (JRC) analyses the economic impact of GHG mitigation policy options for EU agriculture. However, the lack of precise, integrated and harmonised data on the current and potential uptake, cost-effectiveness and GHG emissions reduction potential of technological (i.e. technical and management based) mitigation options hampers the analysis of the economic impacts of GHG mitigation in agriculture. Against this background, the JRC organised a workshop in Seville on 14th June 2016 which gathered European Commission staff and experts from diverse international institutions aiming to: i) identify current activities conducted by research institutes on the building of datasets for GHG mitigation technologies and their state and development, ii) establish synergies and working mechanisms among the different institutions working on the topic, iii) identify which are the current gaps and limitations of existing datasets and models and, iv) conceive a roadmap to build possible new datasets per mitigation technology. The present report is based on the workshop results and concludes on how to move forward.
    Keywords: Mitigation technologies, climate change, GHG emissions, dataset, agriculture
    Date: 2017–08
  45. By: Johannes Emmerling (FEEM and CMCC); Massimo Tavoni (Politecnico di Milano, FEEM and CMCC)
    Abstract: The mismatch between actions to combat climate change, which are based on voluntary national initiatives of limited effort, and the recognition of the importance of global warming is growing. Climate engineering via solar radiation management has been proposed as a possible complement to traditional climate policies. However, climate engineering entails specific risks, including its governance. Free driving, the possibility of unilateral climate engineering to the detriment of other nations, has been recently proposed as a potentially powerful additional externality to the traditional free riding one (Weitzman, 2015). This paper provides the first quantitative evaluation of the risks of free driving. Our results indicate that in a strategic setting there is significant over-provision (by almost an order of magnitude) of climate engineering above what is socially optimal, resulting in a sub-optimal global climate. Regions with high climate change impacts, most notably India and developing Asia, deploy climate engineering at the expenses of other regions.
    Keywords: Climate Engineering, Climate Governance, Free Driving, Climate Policy
    JEL: H41 Q54 Q58
    Date: 2017–12
  46. By: Vassiliki Manoussi (FEEM and CMCC); Soheil Shayegh (FEEM and CMCC); Massimo Tavoni (FEEM and Politecnico di Milano)
    Abstract: Carbon dioxide removal (CDR) is a potentially important climate strategy for attaining low climate stabilization objectives. However, climate analysis has indicated a possible weakening of the ocean carbon sinks -the largest in the world- in relation to CDR deployment. Here, we provide an economic appraisal to assess the sensitivity of CDR and conventional abatement to CO2 outgassing from the oceans. We develop a theoretical framework to study the impact of the ocean-to-atmosphere transfer on the optimal mitigation strategies under different regimes that control the relationship between CO2 outgassing and the amount of CDR. We show that the optimal levels of emissions and CDR are correlated to the effectiveness of CDR expressed as a linear function of atmospheric concentrations. We incorporate this effect into an integrated assessment model of climate and economy (DICE model) and confirm the theoretical findings with numerical simulations. Further, we perform a sensitivity analysis to find the range of optimal abatement and CDR actions under different values of the CDR effectiveness coefficient.
    Keywords: Climate Change, Outgassing, Carbon Dioxide Removal, Integrated Assessment Model (DICE)
    JEL: Q53 Q54
    Date: 2017–12
  47. By: Olivier Massol; Stéphane Tchung-Ming; Albert Banal-Estanol
    Abstract: This paper examines the conditions for the deployment of large scale pipeline and storage infrastructure needed for the capture of CO2 in Spain by 2040. It details a modeling framework that allows us to determine the optimal infrastructure needed to connect a geographically disaggregated set of emitting and storage clusters, along with the threshold CO2 values necessary to ensure that the considered emitters will make the necessary investment decisions. This framework is used to assess the relevance of various policy scenarios, including (i) the perimeter of the targeted emitters for a CCS uptake, and (ii) the relevance of constructing several regional networks instead of a single grid to account for the spatial characteristics of the Spanish peninsula. We find that three networks naturally emerge in the north, center and south of Spain. Moreover, the necessary CO2 break-even price critically depends on the presence of power stations in the capture perimeter. Policy implications of these findings concern the elaboration of relevant, pragmatic recommendations to envisage CCS deployment locally, focusing on emitters with lower substitution options toward low-carbon alternatives.
    Keywords: Carbon capture and storage, CO2 pipeline network, Break-even price for deployment
    Date: 2018
  48. By: Adriano Vinca (Fondazione Eni Enrico Mattei (FEEM)); Marianna Rottoli (Fondazione Eni Enrico Mattei (FEEM)); Giacomo Marangoni (Fondazione Eni Enrico Mattei (FEEM)); Massimo Tavoni (Fondazione Eni Enrico Mattei (FEEM) and Politecnico di Milano)
    Abstract: The climate targets defined under the Paris agreement of limiting global temperature increase below 1.5 or 2°C require massive deployment of low-carbon options in the energy mix, which is currently dominated by fossil fuels. Scenarios suggest that Carbon Capture and Storage (CCS) might play a central role in this transformation, but CCS deployment is stagnating and doubts remain about its techno-economic feasibility. In this article, we carry out a throughout assessment of the role of CCS electricity for a variety of temperature targets, from 1.5 to above 4°C, with particular attention to the lower end of this range. We collect the latest data on CCS economic and technological future prospects to accurately represent several types of CCS plants in the WITCH energy-economy model, We capture uncertainties by means of extensive sensitivity analysis in parameters regarding plants technical aspects, as well as costs and technological progress. Our research suggests that stringent temperature scenarios constrain fossil fuel CCS based deployment, which is maximum for medium policy targets. On the other hand, Biomass CCS, along with renewables, increases with the temperature stringency. Moreover, the relative importance of cost and performance parameters change with the climate target. Cost uncertainty matters in less stringent policy cases, whereas performance matters for lower temperature targets.
    Keywords: Carbon Capture and Storage, Integrated Assessment Model, Climate Mitigation Policies, Electricity Sector, Low-carbon Technology
    JEL: O33 Q42 Q43 Q54
    Date: 2017–12

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