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on Energy Economics |
| By: | Aurélien Saussay (Observatoire français des conjonctures économiques) |
| Abstract: | Over the past decade, the rapid increase in shale gas and shale oil production in the United States has profoundly changed energy markets in North America, and has led to a significant decrease in American natural gas prices. The possible existence of large shale deposits in continental Europe, mainly in France, Denmark, the Netherlands and Germany, has fostered speculation on whether the U.S. shale revolution could be duplicated in Europe. However, a number of uncertainties, notably geological, technological, regulatory, and relating to public acceptance make this possibility unclear. We present a techno-economic model of shale gas production amenable to direct estimation on historical production data to analyze the main determinants of the profitability of shale wells and plays. We contribute an in-depth analysis of an extensive production dataset covering 40,000 wells and accounting for nearly 90% of shale gas production in the six main plays of the continental United States from 2004 to 2014. We combine this analysis with a discussion of the main differences between the American and European contexts to calibrate our model and conduct Monte-Carlo simulations. This enables us to estimate the distribution of breakeven prices for shale gas extraction in continental Europe. We find a median gross breakeven price before taxes and royalties of $10.1 per MMBtu. This would make extraction unprofitable in Europe in the current natural gas price environment, with |
| Keywords: | Shale gas; Extraction costs; United States ; Europe |
| JEL: | Q31 Q32 Q33 Q41 Q54 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/3vsrea3gla9r5oaa2cle5jrqfh&r=ene |
| By: | Niko Jaakkola; Rick van der Ploeg |
| Abstract: | Global warming can be curbed by pricing carbon emissions and thus substituting fossil fuel with renewable energy consumption. Breakthrough technologies (e.g., fusion energy) can reduce the cost of such policies. However, the chance of such a technology coming to market depends on investment. We model breakthroughs as an irreversible tipping point in a multi-country world, with different degrees of international cooperation. We show that international spill-over effects of R&D in carbon-free technologies lead to double free-riding, strategic over-pollution and underinvestment in green R&D, thus making climate change mitigation more difficult. We also show how the demand structure determines whether carbon pricing and R&D policies are substitutes or complements. |
| Keywords: | climate policy with breakthrough technology |
| JEL: | D62 D90 H23 Q38 Q54 Q58 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6977&r=ene |
| By: | Lionel Nesta (Observatoire français des conjonctures économiques); Elena Verdolini; Francesco Vona (Observatoire français des conjonctures économiques) |
| Abstract: | This paper analyzes the effect of environmental policies on the direction of energy innovation across countries over the period 1990-2012. Our novelty is to use threshold regression models to allow for discontinuities in policy effectiveness depending on a country's relative competencies in renewable and fossil fuel technologies. We show that the dynamic incentives of environmental policies become effective just above the median level of relative competencies. In this critical second regime, market-based policies are moderately effective in promoting renewable innovation, while commandand-control policies depress fossil based innovation. Finally, market-based policies are more effective to consolidate a green comparative advantage in the last regime. We illustrate how our approach can be used for policy design in laggard countries. |
| Keywords: | Directed technical change; Threshold models; Environmental policies; Policy mix |
| JEL: | Q58 Q55 Q42 Q48 O34 |
| Date: | 2018–01 |
| URL: | http://d.repec.org/n?u=RePEc:spo:wpmain:info:hdl:2441/2qaasbmk6u8cj8maoa30ls1roi&r=ene |
| By: | Polemis, Michael |
| Abstract: | This paper introduces the concept of market design and make the distinction between the three different levels of market design such as industry structure, wholesale and marketplace design. We present a mixed-integer linear programming (MILP) model for the optimal long-term electricity planning of the Greek wholesale generation system. In order to capture more accurately the technical characteristics of the problem, we have divided the Greek territory into a number of individual interacted networks (geographical zones). In the next stage we solve the system of equations and provide simulation results for the daily/hourly energy prices based on the different scenarios adopted. The empirical findings reveal an inverted-M shaped curve for electricity demand in Greece, while the SMP curve is also non-linear. Lastly, given the simulations results, we provide the necessary policy implications for government officials, regulators and the rest of the marketers. |
| Keywords: | Electricity market; Linear programming; Constraints; Day-ahead scheduling; Mathematical programming. |
| JEL: | C60 L94 Q40 |
| Date: | 2018–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86282&r=ene |
| By: | Andreas Löschel; Jiansuo Pei; Bodo Sturm; Ran Wang; Wolfgang Buchholz; Zhongxiu Zhao |
| Abstract: | In this study, the real demand for global and local environmental protection in Beijing, China, is elicited and investigated. Participants from Beijing were offered the opportunity to contribute to voluntary climate change mitigation by purchasing permits from two Chinese CO2 emissions trading schemes (ETS). Purchased permits were withdrawn from the ETS. Since CO2 emissions mitigation is inevitably linked to other local benefits like the reduction in emissions of air pollutants, the aim of our study is to establish the demand for local and global environmental protection. To this end, Beijing and Shenzhen ETS permits were offered. The result is that at low prices the demand for Beijing ETS permits is significantly higher than for Shenzhen ETS permits indicating that a substantial part of the revealed demand for voluntary climate change mitigation in Beijing is driven by concerns for local co-benefits of CO2 emissions reduction. Our research identifies the important role of private benefits in the voluntary provision of the global public good climate change mitigation and provides first experimental evidence for China. |
| Keywords: | demand for environmental protection, experimental economics, willingness to pay, voluntary climate change mitigation, cobenefits |
| JEL: | C93 Q51 Q54 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6973&r=ene |
| By: | Loeschel, Andreas; Pei, Jiansuo; Sturm, Bodo; Wang, Ran; Buchholz, Wolfgang; Zhao, Zhongxiu |
| Abstract: | In this study, the real demand for global and local environmental protection in Beijing, China, is elicited and investigated. Participants from Beijing were offered the opportunity to contribute to voluntary climate change mitigation by purchasing permits from two Chinese CO2 emissions trading schemes (ETS). Purchased permits were withdrawn from the ETS. Since CO2 emissions mitigation is inevitably linked to other local benefits like the reduction in emissions of air pollutants, the aim of our study is to establish the demand for local and global environmental protection. To this end, Beijing and Shenzhen ETS permits were offered. The result is that at low prices the demand for Beijing ETS permits is significantly higher than for Shenzhen ETS permits indicating that a substantial part of the revealed demand for voluntary climate change mitigation in Beijing is driven by concerns for local co-benefits of CO2 emissions reduction. Our research identifies the important role of private benefits in the voluntary provision of the global public good climate change mitigation and provides first experimental evidence for China. |
| Keywords: | demand for environmental protection,experimental economics,willingness to pay,China,voluntary climate change mitigation,co-benefits |
| JEL: | Q51 Q54 C93 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:18017&r=ene |
| By: | Chang, C-L.; Mai, T.K.; McAleer, M.J. |
| Abstract: | The purpose of the paper is to establish national carbon emissions prices for the People’s Republic of China, which is one of the world’s largest producers of carbon emissions. Several measures have been undertaken to address climate change in China, including the establishment of a carbon trading system. Since 2013, eight regional carbon emissions markets have been established, namely Beijing, Shanghai, Guangdong, Shenzhen, Tianjin, Chongqing, Hubei and Fujian. The Central Government announced a national carbon emissions market, with power generation as the first industry to be considered. However, as carbon emissions prices in the eight regional markets are very different, for a variety of administrative reasons, it is essential to create a procedure for establishing a national carbon emissions price. The regional markets are pioneers, and their experience will play important roles in establishing a national carbon emissions market, with national prices based on regional prices, turnovers and volumes. The paper considers two sources of regional data for China’s carbon allowances, which are based on primary and secondary data sources, and compares their relative strengths and weaknesses. The paper establishes national carbon emissions prices based on the primary and secondary regional prices, for the first time, and compares both national prices and regional prices against each other. The carbon emission prices in Hubei, Guangdong, Shenzhen and Tianjin are highly correlated with the national prices based on the primary and secondary sources. Establishing national carbon emissions prices should be very helpful for the national carbon emissions market that is under construction in China, as well as for other regions and countries worldwide. |
| Keywords: | Pricing Chinese carbon emissions, National pricing policy, Energy, Volatility, Energy finance, Provincial decisions |
| JEL: | C22 C58 G12 Q48 |
| Date: | 2018–03–01 |
| URL: | http://d.repec.org/n?u=RePEc:ems:eureir:105880&r=ene |
| By: | Schleich, Joachim; Gassmann, Xavier; Meissner, Thomas; Faure, Corinne |
| Abstract: | This paper empirically and jointly analyses the relations between risk aversion, standard time discounting, present bias, and loss aversion and household stated adoption of low to high stake energy efficiency technologies (EETs) (light emitting diodes (LEDs), energy efficient appliances, and retrofit measures). The analysis relies on a large representative sample drawn from eight European Union countries. Preferences over time, risk and losses were elicited and jointly estimated from participant choices in incentivized, context-free multiple price list experiments. The findings from econometrically estimating EET adoption equations suggest that present-biased individuals are less likely to adopt EETs. They also provide (weak) evidence that individuals which are more risk-averse, or more loss-averse, or which exhibit a lower discount factor are less likely to adopt EETs. Finally, omitting one or several of the time and risk or loss-aversion parameters when estimating the EET adoption equations did not appear to cause omitted variable bias. |
| Keywords: | risk aversion,time discounting,present bias,loss aversion,energy efficiency,adoption |
| JEL: | D23 D81 Q41 Q48 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fisisi:s042018&r=ene |
| By: | AZUMA Aiko |
| Abstract: | European Union (EU) countries try to integrate electricity markets to secure supply efficiently. The EU's most important task is to create a power system that can deal flexibly with fluctuations in renewable energy. In this research, we focus on the mechanism of regulating the power markets such that a physical security of supply is guaranteed. EU countries operate a variety of different regulating power market systems. Therefore, we compare the differences in regulating the power market system of each country and evaluate the influence of these differences, especially on maintaining a flexible power market. |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:eti:rdpsjp:18015&r=ene |
| By: | Dagoumas, Athanasios; Perifanis, Theodosios; Polemis, Michael |
| Abstract: | This paper aims at disentangling Saudi Arabia’s crude oil strategy, taking into account critical factors such as oil stock, crude oil price, world demand conditions and macro-economic factors. Our study estimates three Error Correction Models (ECMs), using data spanning the period 1971-2015. The empirical findings provide sufficient evidence on the way Saudi Arabia’s crude oil production strategy affects crude oil market. Specifically, when world crude oil demand increases, Saudi Arabia engages into exploitative practices since it tries to impose higher prices leaving room for the increased demand to the rest of the OPEC countries (market sharing). Moreover, we argue that Saudi Arabia’s strategy is in alliance with the trade-off theory of producing more crude oil to establish its market share. However, the country does not intent to fully cover all the increased demand and does not over-react to short-run demand fluctuations since such a strategy would push crude oil prices down. |
| Keywords: | Crude oil; Error Correction Model; Energy; OPEC; Saudi Arabia |
| JEL: | O13 O53 Q41 |
| Date: | 2017–12–18 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86283&r=ene |
| By: | Malikov, Emir; Sun, Kai; Kumbhakar, Subal C. |
| Abstract: | In growth theory, a greater-than-one elasticity of substitution between clean and dirty energy is among key necessary conditions for long-run green economic growth. Using parametric specifications, Papageorgiou et al. (2017) provide first estimates of this fundamentally important inter-energy substitution elasticity. We extend their work by relaxing restrictive functional-form assumptions about production technologies using flexible nonparametric methods. We find that the technological substitutability between clean and dirty energy inputs may not be that strong, especially in the case of a final-goods sector for which the inter-energy elasticity of substitution statistically exceeds one for at most a third of industries/countries. Hence, the favorability of technological conditions for long-run green growth may not be corroborated by the cross-country empirical evidence as strongly as previously thought. |
| Keywords: | aggregate production function, clean and dirty energy, cross-country analysis, elasticity of substitution, environmental policy, green growth |
| JEL: | O44 O47 Q54 Q58 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86260&r=ene |
| By: | Shashank Sripad; Venkatasubramanian Viswanathan |
| Abstract: | There has been considerable interest in the electrification of freight transport, particularly heavy-duty trucks to downscale the greenhouse-gas (GHG) emissions from the transportation sector. However, the economic competitiveness of electric semi-trucks is uncertain as there are substantial additional initial costs associated with the large battery packs required. In this work, we analyze the trade-off between the initial investment and the operating cost for realistic usage scenarios to compare a fleet of electric semi-trucks with a range of 500 miles with a fleet of diesel trucks. For the baseline case with 30% of fleet requiring battery pack replacements and a price differential of US\$50,000, we find a payback period of about 3 years. Based on sensitivity analysis, we find that the fraction of the fleet that requires battery pack replacements is a major factor. For the case with 100% replacement fraction, the payback period could be as high as 5-6 years. We identify the price of electricity as the second most important variable, where a price of US$0.14/kWh, the payback period could go up to 5 years. Electric semi-trucks are expected to lead to savings due to reduced repairs and magnitude of these savings could play a crucial role in the payback period as well. With increased penetration of autonomous vehicles, the annual mileage of semi-trucks could substantially increase and this heavily sways in favor of electric semi-trucks, bringing down the payback period to around 2 years at an annual mileage of 120,000 miles. There is an undeniable economic case for electric semi-trucks and developing battery packs with longer cycle life and higher specific energy would make this case even stronger. |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1804.05974&r=ene |
| By: | Michael Olaf Hoel |
| Abstract: | If bioenergy has a less negative impact on the climate than fossil energy, it may be optimal to have a significant increase in the use of bioenergy over time. Due to the difference in the way the climate is affected by the two types of energy, the future time path of the use of bioenergy may be non-monotonic: It may be optimal to first have an increase in its use, and later a reduction. Optimal taxes and subsidies are derived both for the first-best case and for the case of a constraint on the size of the fossil tax. |
| Keywords: | bioenergy, renewable energy, climate policy, carbon tax, second best, subsidies |
| JEL: | Q42 Q48 Q54 Q58 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6971&r=ene |
| By: | Nikolas D. Müller; Andreas Pfnür |
| Abstract: | Energy and climate policy for the building sector is a subject of controversial discussion. Against this background, the paper aims to dissolve the complexity and thus generate expertise for politically sustainable decisions.Therefore a. perspectives relevant for policy implementation are elaborated from the literature (i.e. owners, tenants, producers, macroeconomic), b. their specific valuation approaches are exposed and c. regarding the current policy for the building sector discussed.On this basis we can show that ‘efficiency‘ is a term of wide variation in the political debate, depending on which perspective is taken. We can present a conceptual model, which shows the interdependencies and interactions of the different valuation approaches. In addition, we can present minimum requirements for a sustainable policy that could be worked out from the discussion, which we use in the end to discuss the appropriateness of alternative control indicators (i. we. primary energy, GHG-Emissions or the energetic quality of the shell) to create equality of interests as a foundation for a successful policy.The work is highly compatible with the interests of the various stakeholders. As a result, it provides a basis for policy implications to enforce energy efficiency and climate protection in the building sector successfully. |
| Keywords: | Conceptual Model for Policy Implications; Different valuation Approaches; Energy and Climate Policy for Real Estate; Environmental Economics; Real Estate Perspectives |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_243&r=ene |
| By: | Chia-Lin Chang (Department of Applied Economics Department of Finance National Chung Hsing University, Taiwan.); Michael McAleer (Department of Quantitative Finance National Tsing Hua University, Taiwan and Econometric Institute Erasmus School of Economics Erasmus University Rotterdam, The Netherlands and Department of Quantitative Economics Complutense University of Madrid, Spain And Institute of Advanced Sciences Yokohama National University, Japan.); Te-Ke Mai (Department of Economics National Tsing Hua University, Taiwan.) |
| Abstract: | The purpose of the paper is to establish national carbon emissions prices for the People’s Republic of China, which is one of the world’s largest producers of carbon emissions. Several measures have been undertaken to address climate change in China, including the establishment of a carbon trading system. Since 2013, eight regional carbon emissions markets have been established, namely Beijing, Shanghai, Guangdong, Shenzhen, Tianjin, Chongqing, Hubei and Fujian. The Central Government announced a national carbon emissions market, with power generation as the first industry to be considered. However, as carbon emissions prices in the eight regional markets are very different, for a variety of administrative reasons, it is essential to create a procedure for establishing a national carbon emissions price. The regional markets are pioneers, and their experience will play important roles in establishing a national carbon emissions market, with national prices based on regional prices, turnovers and volumes. The paper considers two sources of regional data for China’s carbon allowances, which are based on primary and secondary data sources, and compares their relative strengths and weaknesses. The paper establishes national carbon emissions prices based on the primary and secondary regional prices, for the first time, and compares both national prices and regional prices against each other. The carbon emission prices in Hubei, Guangdong, Shenzhen and Tianjin are highly correlated with the national prices based on the primary and secondary sources. Establishing national carbon emissions prices should be very helpful for the national carbon emissions market that is under construction in China, as well as for other regions and countries worldwide. |
| Keywords: | Pricing Chinese carbon emissions, National pricing policy, Energy, Volatility, Energy finance, Provincial decisions. |
| JEL: | C22 C58 G12 Q48 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:ucm:doicae:1810&r=ene |
| By: | Ian Parry; Victor Mylonas |
| Abstract: | The pan-Canadian approach to carbon pricing, announced in October 2016, ensures that carbon pricing applies throughout Canada in 2018, with increasing stringency over time to reduce emissions. Canadian provinces and territories have the flexibility to either implement an explicit price-based system—with a minimum price of CAN $10 per tonne of carbon dioxide equivalent in 2018, increasing to CAN $50 per tonne by 2022—or an equivalently scaled emissions trading system. This paper discusses the rationale for, and design of, the price floor requirement; its (provincial-level) environmental, fiscal, and economic welfare impacts; monitoring issues; and (national-level) incidence. The general conclusion is that the welfare costs and implementation issues are manageable, and pricing provides significant new revenues. A challenge is that the floor price by itself appears well short of what will be needed by 2030 for Canada’s Paris Agreement pledge. |
| Keywords: | carbon price, price floor, Canada, welfare impacts, incidence, effective carbon price, competitiveness impacts |
| JEL: | Q54 Q58 H23 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_6959&r=ene |
| By: | Ruddell, Keith (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Market power in electricity wholesale markets arises when generators have incentives to mark up their offers above the cost of production. I model a transmission network with a single line. I derive optimality conditions for supply functions for generators who supply energy at both ends of the line, and also for generators who hold financial derivatives on the locational prices. These financial derivatives include contracts for differences as well as financial transmission rights. One way that generators can manipulate prices in their favor is by inducing congestion in the network. I find that dispersed ownership and financial transmission rights are both effective ways to reduce strategic congestion of the line. I also fid that certain portfolios of contracts for differences can lead to multiple supply function equilibria. |
| Keywords: | Supply function equilibrium; Electricity markets; Market power; Financial transmission rights |
| JEL: | C62 D43 L13 L94 |
| Date: | 2018–04–20 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:1209&r=ene |
| By: | Yongyang Cai; William Brock; Anastasios Xepapadeas; Kenneth Judd |
| Abstract: | We build a novel stochastic dynamic regional integrated assessment model (IAM) of the climate and economic system including a number of important climate science elements that are missing in most IAMs. These elements are spatial heat transport from the Equator to the Poles, sea level rise, permafrost thaw and tipping points. We study optimal policies under cooperation and various degrees of competition between regions. Our results suggest that when the elements of climate science which are accounted for in this paper are ignored, important policy variables such as the social cost of carbon and adaptation could be seriously biased. |
| JEL: | C61 C63 Q54 Q58 |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24473&r=ene |
| By: | Masaru Yarime |
| Abstract: | In our efforts to promote an urban sustainability, the transformation to smart cities will play a significant role. As smart cities are based on advanced systems of hardware and software—covering various types of products and services relevant to urban functions— innovation for smart cities requires a significant degree of diversity in knowledge, actors, and institutions. Hence it is important to understand the characteristics of the innovation system in smart cities and to introduce policies that will promote forms of innovation that incorporate local conditions and contexts. In this paper, the innovation system of smart cities in Japan is examined to consider implications for public policies and institutional design. The analysis reveals a concentrated structure dominated by large actors, particularly in the public sector and the electric (power generation and distribution) and electronics (appliance and equipment) industries, with knowledge and technological domains concerning renewable energy, energy storage, community energy management, and applications for home appliances and electric vehicles. Policies and regulations influencing the innovation system of smart cities include economic incentives to promote renewable energy technologies, liberalization of energy markets for new entrants, participatory processes of road-mapping on key technologies, localization of demonstration projects reflecting specificities, standard setting for component technologies, and platform creation for stakeholder partnerships including academia, industry, government, and civil society. A key implication for public policy is to facilitate communication and engagement with end users in jointly creating innovation for smart cities. |
| Keywords: | smart city, innovation system, network analysis, stakeholder collaboration, Japan |
| Date: | 2018–03 |
| URL: | http://d.repec.org/n?u=RePEc:jic:wpaper:170&r=ene |
| By: | Danish A. Alvi |
| Abstract: | The dissertation investigates the application of Probabilistic Graphical Models (PGMs) in forecasting the price of Crude Oil. This research is important because crude oil plays a very pivotal role in the global economy hence is a very critical macroeconomic indicator of the industrial growth. Given the vast amount of macroeconomic factors affecting the price of crude oil such as supply of oil from OPEC countries, demand of oil from OECD countries, geopolitical and geoeconomic changes among many other variables - probabilistic graphical models (PGMs) allow us to understand by learning the graphical structure. This dissertation proposes condensing data numerous Crude Oil factors into a graphical model in the attempt of creating a accurate forecast of the price of crude oil. The research project experiments with using different libraries in Python in order to construct models of the crude oil market. The experiments in this thesis investigate three main challenges commonly presented while trading oil in the financial markets. The first challenge it investigates is the process of learning the structure of the oil markets; thus allowing crude oil traders to understand the different physical market factors and macroeconomic indicators affecting crude oil markets and how they are \textit{causally} related. The second challenge it solves is the exploration and exploitation of the available data and the learnt structure in predicting the behaviour of the oil markets. The third challenge it investigates is how to validate the performance and reliability of the constructed model in order for it to be deployed in the financial markets. A design and implementation of a probabilistic framework for forecasting the price of crude oil is also presented as part of the research. |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1804.10869&r=ene |
| By: | Michael Stanley Smith; Thomas S. Shively |
| Abstract: | Wholesale electricity markets are increasingly integrated via high voltage interconnectors, and inter-regional trade in electricity is growing. To model this, we consider a spatial equilibrium model of price formation, where constraints on inter-regional flows result in three distinct equilibria in prices. We use this to motivate an econometric model for the distribution of observed electricity spot prices that captures many of their unique empirical characteristics. The econometric model features supply and inter-regional trade cost functions, which are estimated using Bayesian monotonic regression smoothing methodology. A copula multivariate time series model is employed to capture additional dependence -- both cross-sectional and serial-- in regional prices. The marginal distributions are nonparametric, with means given by the regression means. The model has the advantage of preserving the heavy right-hand tail in the predictive densities of price. We fit the model to half-hourly spot price data in the five interconnected regions of the Australian national electricity market. The fitted model is then used to measure how both supply and price shocks in one region are transmitted to the distribution of prices in all regions in subsequent periods. Finally, to validate our econometric model, we show that prices forecast using the proposed model compare favorably with those from some benchmark alternatives. |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1804.08218&r=ene |
| By: | W. Walker Hanlon |
| Abstract: | This study provides new evidence on the impact of air pollution in London over the century from 1866-1965. To identify weeks with elevated pollution levels I use new data tracking the timing of London's famous fog events, which trapped emissions in the city. These events are compared to detailed new weekly mortality data. My results show that acute pollution exposure due to fog events accounted for at least one out of every 200 deaths in London during this century. I provide evidence that the presence of infectious diseases of the respiratory system, such as measles and tuberculosis, increased the mortality effects of pollution. As a result, success in reducing the infectious diseases burden in London in the 20th century reduced the impact of pollution exposure and shifted the distribution of pollution effects across age groups. |
| JEL: | I15 N3 Q53 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:24488&r=ene |
| By: | Thomas Eichner; Gilbert Kollenbach; Mark Schopf |
| Keywords: | Demand Side Policy, Supply Side Policy, Climate Change, Deposit, Fossil Fuel |
| JEL: | F55 H23 Q54 Q58 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:sie:siegen:185-18&r=ene |
| By: | Nguyen-Ones, Mai; Steen, Frode |
| Abstract: | Applying detailed consecutive daily micro data at the gasoline station level from Sweden we estimate a structural model to uncover the degree of competition in the gasoline retail market. We find that retailers do exercise market power, but despite the high upstream concentration, the market power is very limited on the downstream level. The degree of market power varies with both the distance to the nearest station and the local density of gasoline stations. A higher level of service tends to raise a seller's market power; self-service stations have close to no market power. Contractual form and brand identity also seem to matter. We find a clear result: local station characteristics significantly affect the degree of market power. Our results indicate that local differences in station characteristics can more than offset the average market power found for the whole market. |
| Keywords: | Gasoline markets; local market competition; market power; markup estimation |
| JEL: | D22 L13 L25 L81 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:12879&r=ene |
| By: | Aleksandar Vasilev (Independent Researcher) |
| Abstract: | We introduce a pro-cyclical endogenous utilization rate of physical capita1 stock into a real-business-cycle model augmented with a detailed government sector. We calibrate the model to Bulgarian data for the period following the introduction of the currency board arrangement (1999-2016). We investigate the quantitative importance of the endogenous depreciation rate, and the capital utilization mechanism working through the use of energy for cyclical uctuations in Bulgaria. In particular, a positive shock to energy prices in the model works like a negative technological shock. Allowing for variations in factor utilization and the presence of energy as a factor of production improves the model performance against data, and in addition this extended setup dominates the standard RBC model framework with constant depreciation and a fixed utilization rate of physical capital, e.g., Vasilev (2009). |
| Keywords: | Business uctuations, capital utilization rate, endogenous depreciation rate, energy use, energy prices, Bulgaria |
| JEL: | E32 E22 E37 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:sko:wpaper:bep-2018-05&r=ene |
| By: | Thomas Eichner; Gilbert Kollenbach; Mark Schopf |
| Keywords: | fossil fuel, deposit, deposit-lease policy, deposit-purchase policy, fuel cap |
| JEL: | F55 H23 Q54 Q58 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:sie:siegen:186-18&r=ene |
| By: | María de Lourdes VÁzquez RascÓn (UQAM - Université du Québec à Montréal); Miguel Ángel Corona JimÉnez; Adrian Ilinca (UQAR - Université du Québec A Rimouski) |
| Abstract: | The DEMIT approach (energy development by modeling and territorial intelligence) was created to respond to citizen requests for transparency and participation in decision-making for the construction of wind farms in the state of Quebec, Canada. To this end, DEMIT articulates four modules where multicriterial analysis and collaborative geographic information systems interact with the knowledge (local or techno-scientific) of the actors involved in a renewable energy project. In an academic and institutional framework, and thanks to bilateral financing, in 2012 a pilot project was carried out to transfer and adapt this approach to the Mexican context. This pilot project is fictitious and exclusively academic. |
| Abstract: | El enfoque DEMIT (desarrollo energético por modelización et inteligencia territorial) fue creado para dar respuesta a las solicitudes ciudadanas de transparencia y de participación en la toma de decisión para la construcción de parques eólicos en el estado de Quebec, Canadá. Para ello, DEMIT articula cuatro módulos en donde el análisis multicriterio y los sistemas de información geográfica colaborativos interaccionan con los conocimientos (locales o tecno-científicos) de los actores implicados en un proyecto de energía renovable. En un marco académico e institucional, y gracias a un financiamiento bilateral, en 2012 se realizó un proyecto piloto para la transferencia y adaptación de este enfoque al contexto mexicano. Dicho proyecto piloto es ficticio y exclusivamente académico. Palabras clave: energía renovable, impactos socio-ambientales, toma de decisión participativa. |
| Keywords: | renewable energy,socio-environmental impacts,participatory decision making. |
| Date: | 2017 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-01740298&r=ene |
| By: | Stephan B. Bruns; Johannes König; David I. Stern |
| Abstract: | We replicate Stern (1993, Energy Economics), who argues and empirically demonstrates that it is necessary (i) to use quality-adjusted energy use and (ii) to include capital and labor as control variables in order to find Granger causality from energy use to GDP. Though we could not access the original dataset, we can verify the main original inferences using data that are as close as possible to the original. We analyze the robustness of the original findings to alternative definitions of variables, model specifications, and estimation approach for both the (almost) original time span (1949- 1990) and an extended time span (1949-2015). p-values tend to be substantially smaller if energy use is quality adjusted rather than measured by total joules and if capital is included. Including labor has mixed results. These findings tend to largely support Stern’s (1993) two main conclusions and emphasize the importance of accounting for changes in the energy mix in time series modeling of the energy-GDP relationship and controlling for other factors of production. We also discuss how the inclusion of the original author in designing the replication study using a pre-analysis plan can help to counterbalance the incentive of replicating authors to disconfirm major findings of the original article to increase the probability of getting published. |
| Keywords: | Replication, robustness analysis, sensitivity analysis, energy, GDP, Divisia index, Granger causality |
| JEL: | Q43 C32 C52 |
| Date: | 2018–04 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2018-18&r=ene |
| By: | Jonas Hahn; Christian Ott |
| Abstract: | The real estate sector has great potential to reduce the carbon footprint due to its large number of employed people and its resource- and energy-intensive production and maintenance process.Countless empirical studies have shown that Green Buildings generate additional value in terms of transaction prices and rents. Most of their conclusions, though, are limited to specific submarkets, regions or specific aspects of sustainability. These limitations reduce significantly the reliability of their conclusions. In this context, the extensive green payoff evidence of some studies will have to be discussed. Hypothetically, not all relevant control factors have been accounted for appropriately which might result in an overestimated value of "being green".A hedonic regression will be applied to analyse the Green Payoff of a portfolio of 160 European office buildings held by a German investment management firm from 2011 to 2014. Our analysis extends findings of existing payoff studies as it includes not only sustainability certificates, but also green leases, actual consumption data, tenant satisfaction and undertaken refurbishments. In a second step, another factor will be included in the regression framework – the influence of super trophy status. After having controlled for large surface areas, unique architecture, excellent quality of amenities, building height, prominence and return characteristics, what can we conclude about the statistical significance and the size of Green Premia? How do these findings compare to the existing evidence of green payoff literature on benefits of sustainable commercial real estate in Europe? |
| Keywords: | Green Building; green payoff; Hedonic regression; Sustainability; trophy properties |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_312&r=ene |
| By: | Kaushal, Kevin R. (School of Economics and Business, Norwegian University of Life Sciences); Navrud, Ståle (School of Economics and Business, Norwegian University of Life Sciences) |
| Abstract: | Climate change will have a major impact on global biodiversity. However, these changes – and their economic value– is inadequately captured in the existing Integrated Assessment Models (IAMs). We provide improved damage cost estimates based on a recent biophysical assessment of impact on species loss from increased global mean temperature, and value transfer from a recent global Delphi Contingent Valuation (CV) study of households´ willingness-to-pay (WTP) to avoid species loss due to deforestation of the Amazon rainforest. This is implemented in the FUND (Climate Framework for Uncertainty, Negotiation and Distribution) IAM. The numerical simulations suggest that the global species loss is lower than the original FUND model predicted. However, the economic valuation of the species loss is larger, resulting in higher aggregate biodiversity damage cost. Moreover, depending on the assumed marginal utility of consumption in the regions and discount rate used, the global Social Cost of Carbon Dioxide (SCCO2) could be more than seven times higher than in the original FUND 3.9 IAM. This indicate that IAMs with incomplete assessment and valuation of species loss could greatly underestimate SC-CO2; and thus lead to underinvestment in greenhouse gas mitigation measures. |
| Keywords: | Integrated Assessment Models; Climate change; Ecosystem services; Species loss; Social Costs of Carbon Dioxide |
| JEL: | Q54 |
| Date: | 2018–04–23 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:nlsseb:2018_004&r=ene |
| By: | Nikolas D. Müller; Andreas Pfnür |
| Abstract: | According to the Energy Performance of Building Directive, by 2021 all new housings have to be 'nearly zero energy buildings'. Currently, the definition and the resulting requirements for buildings are a subject of controversial political discussions in Germany. This paper aims to analyze the financial effects for owners and tenants resulting from the proposed ‘nearly zero energy standard’ by 2021.The objective is achieved by investment calculations using the method of complete financial plans. The analyses of the economic effects rely on building energy efficiency calculations of well-known engineering consultancies for two representative Multi-family-houses that form the political debate.Our analysis shows that the specific valuation approach has a significant impact on the result. The discussed 'nearly zero energy’ standard seems to be efficient according to the federal Energy Saving Ordinance (EnEV), but comes to high costs for owners or tenants. That is, because increasing standards of energy efficiency require higher investments, which are not compensated by the achieved reductions in energy consumption. Due to that, the discussed 'nearly zero energy’ standard leads to higher living expenses for tenants, or to lower returns on investment for owners. In addition to that, the stronger requirements result in GHG avoidance costs that are much higher compared to the ones in other sectors.The study is limited in its results to the analyzed building types. Nevertheless, it is of political relevance by showing that further deviations must rely on various efficiency considerations, if real estate actors shall not be overburden and the environmental law effective. |
| Keywords: | Energy and Climate Policy for Real Estate; Energy Efficiency; Energy Performance of Buildings Directive; Nearly zero-energy buildings; ofitability calculations of future energy efficiency standards |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_238&r=ene |
| By: | De Preux Gallone, LB; Sassi, F |
| Abstract: | Interventions to reduce pollution have the potential to increase social welfare through improvements in health, social and economic outcomes. This potential has been shown in a range of economic analyses focusing on specific interventions. In this chapter we present evidence from studies focusing on the health impacts of environmental interventions that have been evaluated from an economic perspective. Overall, this body of evidence is strongly suggestive of beneficial welfare impacts from most interventions. However, there remains significant scope for expanding and strengthening the current evidence base in order to provide clearer guidance to policy makers in policy design and investment decisions. Salient points made in this chapter include: 1) England has successfully managed to “decouple†trends of economic growth and polluting emissions, achieving reductions in emissions of a large range of pollutants with an expanding economy. However, the detrimental health impacts of current levels of pollution are still large, as are the potential benefits of taking more incisive actions against pollution. 2) Economic analysis approaches typically applied in the appraisal of environmental interventions are at odds with those prevailing in the health care domain. A goldstandard economic evaluation approach in the area of environmental health interventions should take a societal perspective and aim at assessing overall impacts on social welfare. Available evidence neglecting these key components likely underestimates the net benefit of pollution reduction measures. 3) Research priorities should now include the evaluation of the societal benefits of measures to address pollution in order to justify economically beneficial interventions that reduce individuals’ pollution exposure or remove the source of emissions. |
| Date: | 2018–03–02 |
| URL: | http://d.repec.org/n?u=RePEc:imp:wpaper:58735&r=ene |
| By: | Ibrahim, Taofik |
| Abstract: | This paper re-examines the government expenditure-revenue nexus in Nigeria from 1970 to 2015. It utilizes the Lee and Strazicich (2003 and 2004) unit root tests that endogenously determines two/one structural breaks in intercept and slope to ascertain the stationarity of the data. The Toda-Yomamoto modified Wald (MWALD)-based causality test that arbitrage between the results with and without structural breaks was conducted to determine the direction of causality between the government expenditure and revenue. The results for the causality test without break suggest that bi-directional causality exists between government expenditure and revenue suggesting the existence of the fiscal synchronization hypothesis. However, the causality test with break reveals a unidirectional causality running from government expenditure to revenue indicating that the spend-revenue hypothesis holds. This finding is a clear departure from other studies on oil-rich countries; thus indicating that accounting for structural break is vital when determining the relationship between government expenditure and revenue for resource countries. This study, therefore, suggests that government should embark on the diversification of the economy away from oil in order to promote reliable and sustained sources of revenue for the nation. |
| Keywords: | Government expenditure, government revenue, structural break, Causality, Nigeria. |
| JEL: | H2 H5 H62 |
| Date: | 2018–01–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:86220&r=ene |
| By: | Ben Wealer; Simon Bauer; Nicolas Landry; Hannah Seiß; Christian von Hirschhausen |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwddc:dd93&r=ene |
| By: | Jean Pierre Ponssard (Department of Economics, École Polytechnique, Palaiseau Cedex, 91128, France - affiliation inconnue); Guy Meunier (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) |
| Date: | 2018–04–24 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:halshs-01777499&r=ene |
| By: | Paul Erian; Gunther Maier; Hans-Martin Neumann; Julia Schmidmayer; Tim Selke |
| Abstract: | The existing stock of buildings plays a key role in achieving goals of energy efficiency and carbon neutrality. Particularly difficult are social housing projects from the 1960s and 1970, which on the one hand were built according to low standards of energy efficiency, and on the other hand are now occupied by an overaged population of lower economic status. In Austria, such neighborhoods constitute a substantial part of the rental housing stock.In this paper we report a project in the city of Salzburg that attempted to analyze the opportunities for converting such a neighborhood toward carbon neutrality. We investigated the legal, institutional, and political framework conditions, analyzed the current technical status of the buildings as well as the social and economic status of the population. In a second step, a number of technical scenarios for investing into energy efficiency of the settlement were developed and evaluated economically. Based on this, we developed recommendations as well as specific steps for their implementation.The paper also takes a critical view of the political and administrative processes, the stakeholders involved and the regulatory framework. |
| Keywords: | 1970s; carbon neutrality; Energy Efficiency; retrofitting; Social Housing |
| JEL: | R3 |
| Date: | 2017–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:arz:wpaper:eres2017_266&r=ene |