nep-ene New Economics Papers
on Energy Economics
Issue of 2018‒07‒09
thirty-six papers chosen by
Roger Fouquet
London School of Economics

  1. The Lights of Iraq: Electricity Usage and the Iraqi War-fare Regime By Cerami, Alfio
  2. Technology, business model, and market design adaptation toward smart electricity distribution: Insights for policy making By Pereira, Guillermo Ivan; Specht, Jan Martin; Pereira da Silva, Patrícia; Madlener, Reinhard
  3. Green Energy Finance in Australia and New Zealand By Diaz-Rainey, Ivan; Sise, Greg
  4. The Effect of Forest Access on the Market for Fuelwood in India By Boskovic, Branko; Chakravorty, Ujjayant; Pelli, Martino; Risch, Anna
  5. An empirical investigation on the distributional impact of network charges in Germany By Schlesewsky, Lisa; Winter, Simon
  6. Policy and Regulation for Energy Storage Systems By Miguel Vazquez; Matteo di Castelnuovo
  7. Empirical Analysis of Factors Influencing Price of Solar Modules By Taghizadeh-Hesary, Farhad; Yoshino, Naoyuki; Inagaki, Yugo
  8. International Environmental Agreements and Trading Blocks - Can issue linkage enhance cooperation? By Effrosyni Diamantousi; Eftichios Sartzetakis; Stefania Strantza
  9. Reserve Provision by CHP Units and its Impact on Equilibria in Spot and Reserve Markets By Christian Furtwängler; Christoph Weber
  10. What Will Make Energy Systems Sustainable? By Angela Köppl; Stefan Schleicher
  11. Stretching the Duck's Neck: The effect of climate change on future electricity demand By Rivers, Nicholas; Shaffer, Blake
  12. The transition in play worldwide employment trends in the electricity sector By Montt, Guillermo E.; Maître, Nicolas.; Amo-Agyei, Silas.
  13. Estimation of costs to the NHS and social care due to the health impacts of air pollution By Pimpin, L; Retat, L; Fecht, D; De Preux Gallone, LB; Sassi, F; Gulliver, J; Belloni, A; Ferguson, B; Corbould, E; Jaccard, A; Webber, L
  14. Intermittent electric generation technologies and smart meters: substitutes or complements By Fadoua Chiba; Sebastien Rouillon
  15. Die europäische CO2-Regulierung für Pkw nach 2021: Plädoyer für eine effizientere Regulierung By Puls, Thomas
  16. Cross-border Electricity Interconnectors in the EU: the Status Quo By Gert Brunekreeft; Roland Meyer
  17. A Quantitative Analysis of Possible Futures of Autonomous Transport By Christopher L. Benson; Pranav D Sumanth; Alina P Colling
  18. Electricity availability: A precondition for faster economic growth? By Rohan Best; Paul J. Burke
  19. How to Measure Financial Market Efficiency? A Multifractality-Based Quantitative Approach with an Application to the European Carbon Market By Cristina Sattarhoff; Marc Gronwald
  20. Informe nacional de monitoreo de la eficiencia energética de Guatemala 2018 By -
  21. Informe nacional de monitoreo de la eficiencia energética de México, 2018 By -
  22. Future green economies and regional development: a research agenda By Gibbs, David; O'Neill, Kirstie
  23. Price strategies of independent and branded dealers in retail gas market. The case of a contract reform in Spain By Pilar Cuadrado; Aitor Lacuesta; María de los Llanos Matea; F. Javier Palencia-González
  24. The Role of Energy Prices in the Great Recession - A Two-Sector Model with Unfiltered Data By Aminu, Nasir; Meenagh, David; Minford, Patrick
  25. Common Values, Unobserved Heterogeneity, and Endogenous Entry in U.S. Offshore Oil Lease Auctions By Giovanni Compiani; Philip A. Haile; Marcelo Sant'Anna
  26. Leverage effects and stochastic volatility in spot oil returns: A Bayesian approach with VaR and CVaR applications By Liyuan Chen; Paola Zerilli; Christopher F Baum
  27. Oil prices and stock markets: A review of the theory and empirical evidence By Stavros Degiannakis; George Filis; Vipin Arora
  28. Oil currencies in the face of oil shocks: what can be learned from time-varying specifications? By Jean-Pierre Allegret; Cécile Couharde; Valérie Mignon; Tovonony Razafindrabe
  29. Information Flows across the Futures Term Structure: Evidence from Crude Oil Prices By Delphine Lautier; Franck Raynaud; Michel Robe
  30. Linkages Between Oil Price Shocks and Stock Returns Revisited By Firmin Doko Tchatoka; Virginie Masson; Sean Parry
  31. Impact of World Oil Prices on an Energy Exporting Economy Including Monetary Policy By Alekhina, Victoriia; Yoshino, Naoyuki
  32. Volatility Linkages between Energy and Food Prices: Case of Selected Asian Countries By Taghizadeh-Hesary, Farhad; Rasoulinezhad, Ehsan; Yoshino, Naoyuki
  33. Food for fuel: The effect of the US biofuel mandate on poverty in India By Chakravorty, Ujjayant; Hubert, Marie-Hélène; Marchand, Beyza Ural
  34. Can an Emission Trading Scheme really reduce CO2 emissions in the short term? Evidence from a maritime fleet composition and deployment model By Gu, Yewen; Wallace, Stein W.; Wang, Xin
  35. Calcul et affichage des émissions de CO2 dans les transports : pour en finir avec le niveau 1 By Maurice Bernadet; Yves Crozet
  36. The impact of climate change and the social cost of carbon By Richard S.J. Tol

  1. By: Cerami, Alfio
    Abstract: This article explores the lights of Iraq, Iraq's variety of capitalism (VoC) and its system of public and fiscal governance. The first section examines Iraq's VoC, which I define oil-led state-captured capitalism with associated oil-led state-captured war-fare regime. In formerly ISIS-occupied territories, war developments turned the system into an Insurgent ISIS-captured capitalism with associated Insurgent ISIS-captured war-fare regime. The second section investigates electricity usage. The nighttime lights analysis is based on near real-time big data. It includes high-resolution remote-sensing and satellite imagery from the NASA Earth Observatory. I use the Visible Infrared Imaging Radiometer Suite (VIIRS) sensor on the Suomi NPP satellite. Data on greenhouse gases are obtained through the AQUA and TERRA satellites derived from the Atmospheric Infrared Sounder (AIRS) and Moderate-resolution Imaging Spectroradiometer (MODIS) sensors. I also use the AURA satellite with the Ozone Monitoring Instrument (OMI) sensor, as well as the TERRA satellite with the Measurements of Pollution in the Troposphere (MOPITT) sensor. The third part discusses the repercussions of electricity usage for good governance, for good regulatory and for good fiscal practices, as well as for development and growth. The concluding part briefly discusses the “taxman approach” and the introduction of a new fiscal contract necessary to resolve negative incentives in oil-led war economies.
    Keywords: Iraq, political economy, ISIS, geo-spatial analysis, night lights, remote-sensing, satellite imagery, public governance, fiscal governance, oil-led state-captured capitalism, oil-led state-captured war-fare regime, state capture, policy capture.
    JEL: C1 O11 O12 P16 P45
    Date: 2018–06–11
  2. By: Pereira, Guillermo Ivan (University of Coimbra); Specht, Jan Martin (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)); Pereira da Silva, Patrícia (University of Coimbra); Madlener, Reinhard (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN))
    Abstract: The ongoing European Union sustainable energy transition has a disruptive potential regarding the role of infrastructure and utilities in the electricity sector. The increased spread of digital technologies, renewable energy sources, and prosumers calls for a swift and well-guided adaptation of the electricity distribution industry towards a smart grids context. We analyze the challenges and opportunities associated with this adaptation through nine multi-stakeholder workshops, held in Germany and Portugal in 2016-2017, engaging distribution system operators (DSOs), researchers, academics, and integrated utility companies to obtain up-to-date insights. Our results indicate uncertainty regarding the value of large-scale rollout of smart meters for DSOs. Also, a corporate culture with resistance to change is observed, challenging the integration of novel technologies and processes. Traditional regulation is seen as a barrier to smart grid investments, is associated with job losses, and knowledge destruction. Policy-makers can benefit from these insights by taking them into account in policy design and market restructuring.
    Keywords: Electricity distribution; smart grid; technology; business model; market design; policy
    JEL: O18 O25 O33 Q41
    Date: 2018–03
  3. By: Diaz-Rainey, Ivan (Asian Development Bank Institute); Sise, Greg (Asian Development Bank Institute)
    Abstract: We explore the history and current status of green energy finance in Australia and New Zealand. Although both countries have enviable renewable energy resources with a 100% renewable mix considered feasible, the two countries present highly contrasting contexts for energy finance. Currently, and largely for historical reasons, renewables make up over 80% of the electricity capacity in New Zealand, whereas in Australia this is 17%. Interestingly, between them and over time, the two countries have employed most of the important policy tools available to incentivize renewables and green energy finance (e.g., carbon taxes, carbon trading, a green investment bank, a green certification market, and feed-in-tariffs). Despite this, we show that between 2004 and 2017 both countries did not meet their potential in terms of renewables and have lower levels of green energy investment relative to gross domestic product per capita than many other developed countries. The Australian and New Zealand context provides many lessons for other jurisdictions—ranging from the need for cross-party and regulatory commitment to energy transition, to the need for policy stability. Indeed, a key issue in Australia and New Zealand is the challenge of designing electricity markets that support energy transition and the investment that it requires. Incumbents in both jurisdictions are fearful of a “death spiral” induced by distributed power, and in Australia political instability and market design issues contributed to a major energy crisis in 2017. However, the crisis, the Paris Agreement, and the associated impetus of new governments in both countries suggest green energy investment is set to increase in the coming years.
    Keywords: energy finance; energy transition; green investment bank; feed-in-tariffs; emissions trading; electricity markets; green certificate market
    JEL: F21 G20 H23 O13 Q40 Q42 Q48 Q54 Q55 Q58
    Date: 2018–05–03
  4. By: Boskovic, Branko; Chakravorty, Ujjayant; Pelli, Martino; Risch, Anna
    Abstract: Fuelwood collection is often cited as the most important cause of deforestation in developing countries. Use of fuelwood in cooking is a leading cause of indoor air pollution. Using household data from India, we show that households located farther away from the forest spend more time collecting. Distant households are likely to sell more fuelwood and buy less. That is, lower access to forests increases fuelwood collection and sale. This counter-intuitive behavior is triggered by two factors: lower access to forests (a) increases the fixed costs of collecting, which in turn leads to more collection; and (b) drives up local fuelwood prices, which makes collection and sale more profitable. We quantify both these effects. Using our estimates we show that a fifth of the fuelwood collected is consumed outside of rural areas, in nearby towns and cities. Our results imply that at the margin, fuelwood scarcity may lead to increased collection and sale, and exacerbate forest degradation.
    Keywords: energy access; cooking fuels; deforestation; forest cover; fuelwood collection
    JEL: D10 O13 Q42
    Date: 2018–05
  5. By: Schlesewsky, Lisa; Winter, Simon
    Abstract: The increase in network costs within the German electricity grid, due to a rising share of renewable energy generation, has led to higher network charges in recent years. We use socioeconomic data in order to investigate distributional effects within the period 2010-2016, and employ three different inequality metrics - the Gini coefficient, the Theil index and the Atkinson index - all of which unambiguously indicate regressive effects of network charges. The three metrics show an increase of economic inequality of at least 0.6 % when accounting for network charges. This finding is due to 1. the relative inferiority of electricity, 2. the regressive impact of a fixed component of network charges, 3. considerable regional disparities, and 4. the higher prevalence of prosumers within high-income households.
    Keywords: network charges,renewable energies,economic inequality
    JEL: D63 Q40 Q42
    Date: 2018
  6. By: Miguel Vazquez; Matteo di Castelnuovo
    Abstract: We analyze the changes in the regulation of electricity systems required to adapt to the presence of energy storage. To that end, we begin by identifying different types of services provided by storage. As services have different economic properties, the economic mechanisms required to organize them will be different as well. There are two relevant “arenas” for storage services: i) buy and sell energy in different periods (including energy related to ancillary services); and ii) avoid the need to transport energy from one point to another, i.e. the need to use transmission and/or distribution networks. Consequently, this involves two kinds of regulatory challenges, because storage compete with different types of services. The first regulatory challenge is related to wholesale market design, because flexibility services can be sold in “competitive” wholesale markets (energy, ancillary services, etc.). The second regulatory challenge has to do with the regulation of energy networks, because storage services may avoid the use of “regulated” networks. Consequently, network rules should allow them to compete in a technologically neutral manner.
    Keywords: Energy Storage Systems; Market Design; Network Regulation
    JEL: D23 D82 L51 L94
    Date: 2018
  7. By: Taghizadeh-Hesary, Farhad (Asian Development Bank Institute); Yoshino, Naoyuki (Asian Development Bank Institute); Inagaki, Yugo (Asian Development Bank Institute)
    Abstract: The decline in solar module prices is one of the key drivers behind the growth of the solar energy market. Thus, the price reduction mechanism in solar modules has become an important topic as the role of solar electricity in the overall energy supply and the market value of solar modules grow globally. Many empirical analyses have been carried out to unveil the mechanism behind this price reduction. However, the research performed on the price reduction mechanism of solar modules over the years have focused purely on the technological aspect of the manufacturing. When analyzing price, the influence of economic factors such as interest rate and exchange rate must also be taken into consideration to achieve a precise analysis. We use an oligopolistic model and econometric method to determine the economic factors that have an influence on solar module prices.
    Keywords: solar modules; renewable energy; price reduction
    JEL: E43 Q21 Q28
    Date: 2018–04–26
  8. By: Effrosyni Diamantousi (Department of Economics, Concordia University); Eftichios Sartzetakis (Department of Economics, University of Macedonia); Stefania Strantza (Department of Economics, Concordia University)
    Abstract: This paper examines the stability of International Environmental Agreements (IEAs) in an economy with trade. We extent the basic model of the IEAs by letting countries choose emission taxes and import tariffs as their policy instruments in order to manage climate change and control trade. We define the equilibrium of a three-stage emission game. In the first stage, each country decides whether or not to join the agreement. In the second stage, countries choose simultaneously - cooperatively or non-cooperatively - tariff and tax levels. In the third stage, taking countries’ decisions as given, firms compete a la Cournot in the product markets. Numerical analysis illustrates that the interaction between trade and environment policies is essential in enhancing cooperation. Contrary to the IEA model, stable agreements are larger and more efficient in reducing aggregate emissions and improving welfare. Moreover, the analysis shows that the size of a stable agreement increases in the number of countries affected by the externalities.
    Keywords: Environmental Agreements.
    JEL: D6 Q5 C7
    Date: 2018–06
  9. By: Christian Furtwängler; Christoph Weber (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen (Campus Essen))
    Abstract: There is a broad consensus that the energy transition planned in Europe, along with an increasing share of renewable energy sources, demands a sufficient number of flexibility providers. The established flexibility procurement mechanisms, notably the reserve markets, are expected to reflect the cost of flexibility provision. As more flexibility is needed – given a higher resulting uncertainty of residual load levels – prices for such provision are expected to rise. In recent years, however, reserve provision prices in Germany have shown a decreasing tendency, with overall reserve demand remaining constant. This contribution proposes to analyse first the equilibrium pricing of reserve power against the electricity spot market in a stylized setting. A fundamental market model is used to analyse the price effects of reserve flexibility from Combined Heat and Power (CHP) entering both markets, using 2016 data as input. Four cases are analysed to assess the effects of different reserve market characteristics. In Case 1, CHP plants may not provide secondary reserve for the reserve market and a stylized heat demand curve is considered as operating restriction of CHP plants in the spot market. Case 2 allows reserve provision by CHP plants, but models these plants without heat restrictions. Case 3 considers the combination of the stylized heat demand curve and reserve from CHP plants. Case 4 extends Case 3 by 100 small CHP power plant pools, analysing their additional effect on reserve prices. From June 2018 on, secondary reserve in Germany will be auctioned in four-hour tenders, instead of the current weekly peak/off-peak auction design. We therefore compare the results to such an alternative auction regime with the same demand, but four-hour reserve provision tenders to reflect upcoming market design changes. Our approach leads to spot prices at a similar mean level compared to historical data, with MAE values in a range from 5.91-6.64 €/MWh for all cases. The positive reserve price levels in this approach also compare to mean historical price levels. The price lowering effect of flexibility provision from CHP is clearly identifiable, underscoring the importance of explicit modelling of heat demand restrictions. A change of the reserve tender regime towards 4-hour tenders further lowers positive reserve prices in all cases. As a result, low reserve price levels may be expected to persist in the medium term despite the expected increase of intermitting generation.
    Keywords: Equilibrium pricing, flexibility provision, reserve markets, combined heat and power, heat restrictions
    JEL: Q41 Q48
  10. By: Angela Köppl (WIFO); Stefan Schleicher (WIFO)
    Abstract: One of the lessons learned from the German effort under the heading of Energiewende is the insight that simply shifting to renewables and recommending improving energy efficiency is not sufficient to lower greenhouse gas emissions. Combined with the expected radical change of technologies this requires a more profound understanding of our energy systems. Therefore, in contrast to most conventional approaches we propose a deepened structural analysis that covers the full energy value chain from the required functionalities for mechanical, thermal and specific electric energy services via application and transformation technologies up to primary energy. This deepened structural approach opens and substantially enhances our understanding of policy designs that are compatible with the Paris Agreement and Sustainable Development Goals. We discover the essential role of four energy grids, namely for electricity, heat, gas, and information as the key for integrating all components of a newly structured energy system. Consequently, we conclude that policy strategies focusing on individual components of an energy system as simply shifting to renewables may from a comprehensive perspective on sustainability in the worst case even turn out as counterproductive.
    Keywords: Sustainable energy systems, Energy value chain, Energy grids
    Date: 2018–06–14
  11. By: Rivers, Nicholas; Shaffer, Blake
    Abstract: This paper examines how climate change will affect both the level and timing of future electricity demand across Canada. Using an original dataset of hourly electricity demand across all Canadian provinces combined with household-level microdata on air conditioner ownership, we estimate temperature responsiveness including both the direct effect of temperature on demand for cooling services, as well as the indirect effect of increasing the stock of temperature-sensitive durables, such as air conditioners. We find only a small increase in total demand by end-century, although the result differs across provinces. The small aggregate result reflects the mitigating effect of rising temperature in a cold country such as Canada, whereby increases in electricity demand for air conditioning as summer temperatures rise is largely offset by reduced winter heating demand. Although we project limited change in overall electricity demand, we do project changes in the timing of demand, both seasonally and diurnally. In particular, we find seasonal peaks shift from winter to summer in most regions, as well as a large increase in intraday ramping requirements—the difference between minimum and maximum demand within a day—suggesting electricity systems of the future will place an even greater value on storage and flexibility.
    Keywords: Climate change, future electricity demand, diurnal shape
    JEL: Q40 Q47 Q54
    Date: 2018
  12. By: Montt, Guillermo E.; Maître, Nicolas.; Amo-Agyei, Silas.
    Abstract: Electricity generation from renewable sources has been touted as a win-win solution for the advancement towards both environmental sustainability and decent work for all. This paper analyses the employment effects of electricity generation by different sources on a worldwide scale as observed since the year 2000. It finds that the additional generation from renewable, non-hydro, energy sources has been related to higher job creation in the electricity sector when compared to other energy sources, notably fossil fuel- based technologies. As predicted, renewables also help reduce GHG emissions. Estimating the economy-wide effects through employment multipliers provide more evidence that developing renewable energy has positive environmental and employment impact throughout the entire economy.
    Date: 2018
  13. By: Pimpin, L; Retat, L; Fecht, D; De Preux Gallone, LB; Sassi, F; Gulliver, J; Belloni, A; Ferguson, B; Corbould, E; Jaccard, A; Webber, L
    Date: 2018–05–22
  14. By: Fadoua Chiba; Sebastien Rouillon
    Abstract: We model a simplified electric market with producers using either conventional or intermittent electric generators and consumers equipped with either smart or traditional meters. We calculate the investment in intermittent technologies and smart meters in a social optimum. We find that the optimal penetration of smart meters is increasing in the volatility of the electric spot price. As a consequence, intermittent capacities and smart-meters are complement, only if the correlation existing between intermittent energy and demand is negative or if the capacity of intermittent generators is large enough. Otherwise, larger intermittent capacities actually help to decrease the volatility of the electric spot price, making smart-meters less useful. We also give a numeral application, calibrated to represent the French electric market in 2016 and policy objective for 2030. We show in particular that a general adoption of smart meters would be optimal only if the cost of installing and operating smart meters was unrealistically low.
    Keywords: Capacity choice, electricity, intermittency, renewable energy
    JEL: D24 D41 Q41 L11
    Date: 2018
  15. By: Puls, Thomas
    Abstract: Die EU hat sich zum Ziel gesetzt, die CO2-Emissionen des Verkehrs im Zeitraum von 2005 bis 2030 um 30 Prozent zu senken. Damit das erreicht werden kann, müssen insbesondere die Emissionen des Pkw-Verkehrs sinken. Ohne weitere Regulierungsschritte wird der Verkehrssektor aber das Klimaziel verfehlen. Aus diesem Grund wird jetzt in Brüssel über die Fortschreibung der Emissionsgrenzwerte für neue Pkw diskutiert. Im Verkehr setzt die EU somit bislang nicht auf Mengen- oder Preissteuerung, sondern auf die Regulierung des Emissionspotenzials von Neuwagen. Der Autofahrer und die am Markt bestehende Nachfrage werden an dieser Stelle nicht adressiert. Eine große Schwäche, da alle Klimaschutzszenarien einen erfolgreichen Markthochlauf von Elektroautos erfordern, was ohne Akzeptanz beim Kunden scheitern muss. Brüssel sollte daher seinen Instrumentenkasten neu gewichten. Die Koppelung von Straßen- und Strom Sektor sollte ins Zentrum der Aufmerksamkeit rücken. Nichtsdestotrotz hat die Kommission einen Vorschlag zur Fortschreibung der Grenzwerte bis 2030 vorgelegt. Dieser ist laut Impact-Assessment zielkonform. Dennoch gibt es in Brüssel Stimmen, die eine deutliche Verschärfung der Vorlage fordern. Das ist aber der falsche Ansatz. Bereits der Kommissionsentwurf erfordert einen Markthochlauf der Elektromobilität. Dies erfordert aber, dass die Nachfrageseite das Zusatzangebot an Elektroautos auch akzeptiert. Das wird aber nur geschehen, wenn die Rahmenbedingungen passen. Insbesondere eine öffentliche Ladeinfrastruktur muss aufgebaut werden, was gerade in Deutschland noch auf Hindernisse stößt, die der Staat eigentlich schnell beseitigen könnte. Hierauf sollte der künftige klimapolitische Fokus gerichtet werden und nicht auf über den Bedarf hinausgehende Grenzwerte. Sonst droht eine Überregulierung des Angebotes und damit negative Auswirkungen auf den Industriestandort, Arbeitsplätze und auch für den Klimaschutz.
    JEL: O25 O30 Q54
    Date: 2018
  16. By: Gert Brunekreeft; Roland Meyer
    Abstract: An important goal of the European Commission is the promotion of the internal energy market (here specifically electricity), which requires sufficient and adequate cross-border interconnector capacity. However, cross-border interconnector capacity is scarce and, more importantly, the progress of interconnector capacity expansion is too slow. As a result, the Commission has proposed several policy measures to accelerate interconnector investment. This paper provides an overview of the policy debate on interconnector expansion and studies two particular points. First, the effects of network regulation on the interconnector investment and the policy proposals to improve the investment incentives, and more specifically, how to deal with risks. Second, we study the policies and effects of capacity remuneration mechanisms (CRMs) on the use of and the need for cross-border interconnector capacity.
    Keywords: electric utilities, regulation, market design, capacity remuneration mechanisms
    JEL: L94 L51
    Date: 2018–02
  17. By: Christopher L. Benson; Pranav D Sumanth; Alina P Colling
    Abstract: Autonomous ships (AS) used for cargo transport have gained a considerable amount of attention in recent years. They promise benefits such as reduced crew costs, increased safety and increased flexibility. This paper explores the effects of a faster increase in technological performance in maritime shipping achieved by leveraging fast-improving technological domains such as computer processors, and advanced energy storage. Based on historical improvement rates of several modes of transport (Cargo Ships, Air, Rail, Trucking) a simplified Markov-chain Monte-Carlo (MCMC) simulation of an intermodal transport model (IMTM) is used to explore the effects of differing technological improvement rates for AS. The results show that the annual improvement rates of traditional shipping (Ocean Cargo Ships = 2.6%, Air Cargo = 5.5%, Trucking = 0.6%, Rail = 1.9%, Inland Water Transport = 0.4%) improve at lower rates than technologies associated with automation such as Computer Processors (35.6%), Fuel Cells (14.7%) and Automotive Autonomous Hardware (27.9%). The IMTM simulations up to the year 2050 show that the introduction of any mode of autonomous transport will increase competition in lower cost shipping options, but is unlikely to significantly alter the overall distribution of transport mode costs. Secondly, if all forms of transport end up converting to autonomous systems, then the uncertainty surrounding the improvement rates yields a complex intermodal transport solution involving several options, all at a much lower cost over time. Ultimately, the research shows a need for more accurate measurement of current autonomous transport costs and how they are changing over time.
    Date: 2018–06
  18. By: Rohan Best; Paul J. Burke
    Abstract: We investigate if greater electricity availability helps countries ascend to faster economic growth trajectories. This is an important question for many developing countries that are currently prioritizing infrastructure investments. Using cross-sectional and panel regressions with national-level decadal data, we find some evidence that electricity availability has a significant effect on subsequent economic growth. However, much of the effect disappears once suitable controls are included. We examine various dimensions of electricity availability, including electricity consumption quantity, generation capacity, residential access rate, and quality of electricity supply. It appears that electricity availability is best viewed as something that can be scaled up as economies grow rather than something that imposes binding constraints on subsequent economic growth.
    Keywords: electricity availability, electricity consumption, economic growth, development economics
    JEL: O47 Q43 Q48
    Date: 2018–06
  19. By: Cristina Sattarhoff; Marc Gronwald
    Abstract: This paper proposes a new measure for the evaluation of financial market efficiency, the so-called intermittency coefficient. This is a multifractality measure that can quantify the deviation from a random walk within the framework of the multifractal random walk model by Bacry et al. (2001b). While the random walk corresponds to the most genuine form of market efficiency, the larger the value of the intermittency coefficient is, the more inefficient a market would be. In contrast to commonly used methods based on Hurst exponents, the intermittency coefficient is a more powerful tool due to its well-established inference apparatus based on the generalised method of moments estimation technique. In an empirical application using data from the largest currently existing market for tradable pollution permits, the European Union Emissions Trading Scheme, we show that this market becomes more efficient over time. In addition, the degree of market efficiency is overall similar to that for the US stock market; for one sub-period, the market efficiency is found to be higher. While the first finding is anticipated, the second finding is noteworthy, as various observers expressed concerns with regard to the information efficiency of this newly established artificial market.
    Keywords: market efficiency, multifractality, multifractal random walk, European Union Emissions Trading Scheme
    JEL: C58 C53 G14 Q02 Q54
    Date: 2018
  20. By: -
    Abstract: El Informe Nacional de Monitoreo de la Eficiencia Energética de Guatemala fue preparado como parte de las actividades llevadas a cabo por el Ministerio de Energía y Minas (MEM) de Guatemala en el marco del Programa Base de Indicadores de Eficiencia Energética (BIEE), coordinado por la CEPAL con la contribución de la Agencia Alemana para la Cooperación Internacional (GIZ) y el apoyo técnico de la Agencia Francesa del Medio Ambiente y la Gestión de la Energía (ADEME). Este informe analiza las tendencias de la eficiencia energética y el consumo de energía para los sectores industrial, transporte, servicios, residencial y agropecuario en Guatemala. Los indicadores propuestos por el BIEE constituyen una herramienta útil para el monitoreo de los programas y el análisis de políticas de eficiencia energética.
    Date: 2018–06–21
  21. By: -
    Abstract: El Informe Nacional de Monitoreo de la Eficiencia Energética de México fue preparado como parte de las actividades llevadas a cabo por la Comisión Nacional para el Uso Eficiente de la Energía (CONUEE) de México en el marco del Programa Base de Indicadores de Eficiencia Energética (BIEE), coordinado por la Comisión Económica para América Latina y el Caribe (CEPAL) con la contribución de la Agencia Alemana para la Cooperación Internacional (GIZ) y el apoyo técnico de la Agencia Francesa del Medio Ambiente y la Gestión de la Energía (ADEME). Este informe presenta una serie de indicadores que muestran la evolución de la eficiencia energética en México. Analiza las tendencias del consumo de energía y de las medidas de eficiencia energética a nivel nacional para los sectores energético, industrial, transporte, comercial-servicios, residencial y agropecuario, además del nexo entre agua y energía. Los indicadores propuestos por el programa BIEE constituyen una herramienta útil para el monitoreo de los programas y el análisis de políticas de eficiencia energética.
    Date: 2018–05–28
  22. By: Gibbs, David; O'Neill, Kirstie
    Abstract: The past thirty years have seen an explosion of interest and concern over the detrimental impacts of economic and industrial development. Despite this, the environmental agenda has not featured substantially in the regional studies literature. This paper explores a range of options for regional futures from a ‘clean tech’ economy and the promise of renewed accumulation, through to more radical degrowth concepts focused on altering existing modes of production and consumption, ecological sustainability and social justice. In so doing, we investigate the potential role of regions as drivers of the new green economy, drawing on research into sustainability transitions.
    Keywords: Green economy; Transitions research; Clean tech; Degrowth; Regional Development
    JEL: Q5 Q58
    Date: 2017–01–02
  23. By: Pilar Cuadrado (Banco de España); Aitor Lacuesta (Banco de España); María de los Llanos Matea (Banco de España); F. Javier Palencia-González (UNED)
    Abstract: This paper analyses how the contract structure between gas stations and the wholesale operator affects price strategies. Using daily data on prices of different gas stations the paper finds that independent dealers charge lower margins than other dealers with different contracts. One potential hypothesis is that this is the case because independent stations react more to the number of competitors. We use the introduction of a discretional regional excise duty (IVMDH) on gas stations to check the reaction of markups to changes in marginal costs of the actual number of competitors. Results are consistent with the idea that regardless the type of contract all dealers react notably to the increases in relative marginal costs by decreasing average markups. We use those results to interpret the inexistent reduction in markups that followed a change in the Spanish regulation that took place in 2013 fostering competition in the retail sector. One potential interpretation is that the big increase in independent stations following the reform was not considered an increase in actual competition for most of the incumbent stations.
    Keywords: competition, oligopoly, pass-through, gasoline, excise duty
    JEL: D40 H22 H23 L13 Q41
  24. By: Aminu, Nasir (Cardiff Business School); Meenagh, David (Cardiff Business School); Minford, Patrick (Cardiff Business School)
    Abstract: We investigate the role of energy shocks during the Great Recession. We study the behaviour of the UK energy and non-energy intensive sectors firms in a real business cycle (RBC) model using unfiltered data. The model is econometrically estimated and tested by indirect inference. Output contraction during the Great Recession was largely caused by energy price and sector-specific productivity shocks, all of which are non-stationary and hence tend to dominate the sample variance decomposition. We also found that the channel by which the energy price shock reduces output in the model is via the terms of trade: these fall permanently when world energy prices increase and as substitutes for energy inputs are strictly limited there are few reactions via production channels. Therefore, there is no other way to balance the deteriorating current account than through lower domestic absorption.
    JEL: E
    Date: 2018–06
  25. By: Giovanni Compiani (niversity of California, Berkeley, Haas School of Business); Philip A. Haile (Cowles Foundation, Yale University); Marcelo Sant'Anna (FGV EPGE)
    Abstract: An oil lease auction is the classic example motivating a common values model. However, formal testing for common values has been hindered by unobserved auction-level heterogeneity, which is likely to affect both participation in an auction and bidders' willingness to pay. We develop and apply an empirical approach for first-price sealed bid auctions with affiliated values, unobserved heterogeneity, and endogenous bidder entry. The approach also accommodates spatial dependence and sample selection. Following Haile, Hong and Shum (2003), we specify a reduced form for bidder entry outcomes and rely on an instrument for entry. However, we relax their control function requirements and demonstrate that our specification is generated by a fully specified game motivated by our application. We show that important features of the model are nonparametrically identified and propose a semiparametric estimation approach designed to scale well to the moderate sample sizes typically encountered in practice. Our empirical results show that common values, affiliated private information, and unobserved heterogeneity - three distinct phenomena with different implications for policy and empirical work - are all present and important in U.S. offshore oil and gas lease auctions. We find that ignoring unobserved heterogeneity in the empirical model obscures the presence of common values. We also examine the interaction between affiliation, the winner's curse, and the number of bidders in determining the aggressiveness of bidding and seller revenue.
    Date: 2018–06
  26. By: Liyuan Chen (University of York); Paola Zerilli (University of York); Christopher F Baum (Boston College; German Institute for Economic Research (DIW Berlin))
    Abstract: The crude oil markets have been quite volatile and risky in the past few decades due to the large fluctuations of oil prices. We contribute to the current debate by testing for the existence of the leverage effect when considering daily spot returns in the WTI and Brent crude oil markets and by studying the direct impact of the leverage effect on measures of risk such as VaR and CVaR. More specifically, we model spot crude oil returns using Stochastic Volatility (SV) models with various distributions of the errors. We find that the introduction of the leverage effect in the traditional SV model with Normally distributed errors is capable of adequately estimating risk for conservative oil suppliers in both the WTI and Brent markets while it tends to overestimate risk for more speculative oil suppliers. Our results also show that the choice of financial regulators, both on the supply and on the demand side, would not be affected by the introduction of leverage. Focusing instead on firm’s internal risk management, our results show that the introduction of leverage would be useful for firms who are on the demand side for oil, who use VaR for risk management and who are particularly worried about the magnitude of the losses exceeding VaR while wanting to minimize the opportunity cost of capital. Using the same logic, firms who are on the supply side would be better off not considering the leverage effect.
    Keywords: Value-at-Risk, Conditional Value-at-Risk, Asymmetric Laplace distribution, Stochastic volatility model, Bayesian Markov Chain Monte Carlo, leverage effect
    JEL: C11 C58 G17 G32
    Date: 2018–01–28
  27. By: Stavros Degiannakis (Department of Economics and Regional Development, Panteion University of Social and Political Sciences and Department of Accounting, Finance and Economics, Bournemouth University); George Filis (Department of Accounting, Finance and Economics, Bournemouth University); Vipin Arora (U.S. Energy Information Administration)
    Abstract: Do oil prices and stock markets move in tandem or in opposite directions? The complex and time varying relationship between oil prices and stock markets has caught the attention of the financial press, investors, policymakers, researchers, and the general public in recent years. In light of such attention, this paper reviews research on the oil price and stock market relationship. The majority of papers we survey study the impacts of oil markets on stock markets, whereas, little research in the reverse direction exists. Our review finds that the causal effects between oil and stock markets depend heavily on whether research is performed using aggregate stock market indices, sectoral indices, or firm-level data and whether stock markets operate in net oil-importing or net oil-exporting countries. Additionally, conclusions vary depending on whether studies use symmetric or asymmetric changes in the price of oil, or whether they focus on unexpected changes in oil prices. Finally, we find that most studies show oil price volatility transmits to stock market volatility, and that including measures of stock market performance improves forecasts of oil prices and oil price volatility. Several important avenues for further research are identified.
    Keywords: Oil prices; stock markets; interconnectedness; forecasting; oil-importers; oil-exporters
    JEL: G15 Q40 Q47
    Date: 2018–06
  28. By: Jean-Pierre Allegret (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Cécile Couharde (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Valérie Mignon (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Tovonony Razafindrabe (EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique)
    Abstract: While the oil currency property is clearly establis hed from a theoretical viewpoint, its existence is less clear-cut in the empirical literature. We investigate the reasons for this apparent puzzle by studying the time-varying nature of the relationship between real effective exchange rates of five oil exporters and the real price of oil in the aftermath of the oil price shocks of the last two decades. Accordingly, we rely on a time-varying parameter VAR specification which allows the responses of real exchange rates to different oil price shocks to evolve over time. We find that the reason of the mixed results obtained in the empirical literature is that oil currencies follow different hybrid models in the sense that oil countries’real exchange rates may be driven by one or several sources of oil price shocks that furthermore can vary over time. In addition to structural changes affecting oil countries, structural changes arising from the oil market itself through the various, time-varying sources of oil price shocks are found to be crucial.
    Keywords: oil currencies,oil shocks,Time-Varying Parameter VAR model,exchange rates
    Date: 2017
  29. By: Delphine Lautier (DRM - Dauphine Recherches en Management - Université Paris-Dauphine - CNRS - Centre National de la Recherche Scientifique); Franck Raynaud (Lausanne university - Lausanne university); Michel Robe (University of Illinois - university of Illinois)
    Abstract: We apply the concepts of mutual information and information flows and we built directed graphs to investigate empirically the propagation of price fluctuations across a futures term structure. We focus on price relationships for North American crude oil futures because this key market experienced several structural shocks between 2000 and 2014: financialization (starting in 2003), infrastructure limitations (in 2008-2011) and regulatory changes (in 2012-2014). Wefind large variations over time in the amount of information shared by contracts with different maturities. The mutual information increased substantially starting in 2004 but fell back sharply in 2012-2014. In the crude oil space, our findings point to a possible re-segmentation of the futures market by maturity in 2012-2014. This raises questions about the causes of market segmentation. In addition, although on average short-dated contracts (up to 6 months) emit more information than backdated ones, a dynamic analysis reveals that, after 2012, similar amounts of information flow backward as flow forward along the futures maturity curve. Moreover, the directions of the transfers between pairs of maturities become drastically different. This has implications for the Samuelson effect.
    Keywords: Mutual information,Market integration,Shocks propagation,Information flows,Directed graphs,Term structure,Futures,Crude oil,WTI
    Date: 2017–05
  30. By: Firmin Doko Tchatoka (School of Economics, University of Adelaide); Virginie Masson (School of Economics, University of Adelaide); Sean Parry (School of Economics, University of Adelaide)
    Abstract: In this paper, we revisit the debate on the relationship between oil price shocks and stock market returns by replicating the quantile-on-quantile (QQ) regression model for the US stock market in Sim and Zhou (2015, Journal of Banking and Finance), and extending it to 15 countries. The classification of these countries as oil importers or oil exporters depends on their net position in crude oil trade. Our results indicate that the finding by Sim and Zhou (2015) that large negative oil price shocks can bolster stock returns when markets are performing well is only partially supported by the three largest oil importers in our sample-China, Japan and India-during the period 1988:1-2007:12. However, when extending the study to more recent data (period 1988:1-2016:12), we find that China and India experience higher returns when markets perform well and there is a large positive oil price shock. Also, large positive oil price shocks often lead to higher stock market returns when markets perform well for both oil exporting countries-Canada, Russia, Norway-and moderately oil dependent countries-such as Malaysia, Philippines and Thailand. These findings highlight that the relationship between the distributions of oil price shocks and stock market returns is not stable over time in most countries studied. Furthermore, the asymmetric effect of oil price shocks observed in the US market by Sim and Zhou (2015) is less evident in most countries for both the baseline and extended periods.
    Keywords: Oil prices; stock returns; Quantile regression
    JEL: C01 C14 C31 G15
    Date: 2018–01
  31. By: Alekhina, Victoriia (Asian Development Bank Institute); Yoshino, Naoyuki (Asian Development Bank Institute)
    Abstract: We investigate the interrelationship between the main macroeconomic indicators of an oil exporting country and world oil prices using a vector autoregressive approach. We focus on an oil exporter that is not a member of the Organization of the Petroleum Exporting Countries, and its oil revenues, which account for a significant proportion of the country’s total export and budget revenues. We explain the oil price transition mechanisms to this economy from the export side and through the fiscal channel, taking into account the monetary policy factor. The results suggest that oil price fluctuations have a significant impact on the oil exporting country’s real gross domestic product, consumer price index inflation rate, interest rate, and exchange rate. Moreover, to estimate monetary policy rule for this energy exporter, we test the Taylor equation and associated Taylor rule, including the oil prices gap, since the latter may have a significant impact on the key policy rate. The evidence suggests that the Taylor rule describes the post-financial crisis monetary policy of this economy relatively well. Finally, we discuss future research and lessons from this economy for monetary policy makers.
    Keywords: oil prices; energy exporters; macro-economy; VAR model
    JEL: Q41 Q43 Q48
    Date: 2018–03–23
  32. By: Taghizadeh-Hesary, Farhad (Asian Development Bank Institute); Rasoulinezhad, Ehsan (Asian Development Bank Institute); Yoshino, Naoyuki (Asian Development Bank Institute)
    Abstract: We examine the linkages between energy price and food prices over the period 2000–2016 by using a Panel-VAR model in the case of 8 Asian economies: Bangladesh, the People’s Republic of China, Indonesia, India, Japan, Sri Lanka, Thailand, and Viet Nam. Our results confirm that energy price (oil price) has a significant impact on food prices. According to the results of impulse response functions, agricultural food prices respond positively to any shock from oil prices. The findings from variance decomposition reveal that shares of oil prices in agricultural food price volatilities are the largest. In the second period 4.81%, and in the 20th period 62.49%, of food price variance is explained by oil price movements. We offer new policy insight. Since We also found that the impact of biofuel prices on food prices is statistically significant but explains less than 2% of the food price variance. However, by increasing the demand for biofuel, especially in advanced countries, there should be more concern about the global increase in agricultural commodities prices and endangering food security, especially in vulnerable economies.
    Keywords: oil price; food price; agricultural commodities prices; Panel-VAR model
    JEL: O13 Q11 Q18 Q41
    Date: 2018–03–26
  33. By: Chakravorty, Ujjayant; Hubert, Marie-Hélène; Marchand, Beyza Ural
    Abstract: More than 40% of US grain is used for energy due to the Renewable Fuels Mandate (RFS). There are no studies of the global distributional consequences of this purely domestic policy. Using micro-level survey data, we trace the effect of the RFS on world food prices and their impact on household level consumption and wage incomes in India. We first develop a partial equilibrium model to estimate the effect of the RFS on the price of selected food commodities - rice, wheat, corn, sugar and meat and dairy, which together provide almost 70% of Indian food calories. Our model predicts that world prices for these commodities rise by 8-16% due to the RFS. We estimate the price pass-through to domestic Indian prices and the effect of the price shock on household welfare through consumption and wage incomes. Poor rural households suffer significant welfare losses due to higher prices of consumption goods, which are regressive. However they benefit from a rise in wage incomes, mainly because most of them are employed in agriculture. Urban households also bear the higher cost of food, but do not see a concomitant rise in wages because only a small fraction of them work in food related industries. Welfare losses are greater among urban households. However, more poor people in India live in villages, so rural poverty impacts are larger in magnitude. We estimate that the mandate leads to about 26 million new poor: 21 million in rural and five million in the urban population.
    Keywords: Biofuels; Distributional effects; Household welfare; Renewable Fuel Standards; Poverty
    JEL: D31 O12 Q24 Q42
    Date: 2018–05
  34. By: Gu, Yewen (Dept. of Business and Management Science, Norwegian School of Economics); Wallace, Stein W. (Dept. of Business and Management Science, Norwegian School of Economics); Wang, Xin (Dept. of Industrial Economics and Technology Management, Norwegian University of Science and Technology)
    Abstract: Global warming has become one of the most popular topics on this planet in the past decades, since it is the challenge that needs the efforts from the whole mankind. Maritime transportation, which carries more than 90% of the global trade, plays a critical role in the contribution of green house gases (GHGs) emission. Unfortunately, the GHGs emitted by the global fleet still falls outside the emission reduction scheme established by the Kyoto Protocol. Alternative solutions are therefore strongly desired. Several market-based measures are proposed and submitted to IMO for discussion and evaluation. In this paper, we choose to focus on one of these measures, namely Maritime Emissions Trading Scheme (METS). An optimization model integrating the classical fleet composition and deployment problem with the application of ETS (global or regional) is proposed. This model is used as a tool to study the actual impact of METS on fleet operation and corresponding CO2 emission. The results of the computational study suggest that in the short term the implementation of METS may not guarantee further emission reduction in certain scenarios. However, in other scenarios with low bunker price, high allowance cost or global METS coverage, a more significant CO2 decrease in the short term can be expected.
    Keywords: Maritime Emissions Trading Scheme; CO2 emissions; maritime fleet composition; deployment model
    JEL: C44 C60 Q50
    Date: 2018–06–27
  35. By: Maurice Bernadet (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); Yves Crozet (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: Le décret 2017-639 et son arrêté d’application, datés du 26 et publiés le 28 avril 2017 au Journal officiel modifient sur trois points la réglementation en vigueur pour l’information sur les émissions de CO2 des services de transport. La première modification est logique. Pour se rapprocher de la norme européenne, seront évalués non seulement le CO2, mais aussi d’autres gaz à effet de serre comme le méthane, et à terme les fuites de liquide frigorigène. Second changement, l’obligation d’information ne concerne que les services ayant leur origine et leur destination en France. Dans cet article, nous nous penchons sur la troisième composante du décret, celle qui repousse à 2019 (au lieu du 1er juillet 2016!) l’obligation pour les entreprises de 50 salariés ou plus d’abandonner la méthode dite de «niveau 1 ». Nous pensons que c’est regrettable. En voici l’explication. On notera que .dans cet article les arguments utilisés et les raisonnements développés se réfèrent aux seuls transports routiers de marchandises. Toutefois, il est clair que certains des arguments présentés ont une portée plus générale et pourraient justifier que ses conclusions soient étendues, moyennant éventuellement des adaptations, à d’autres modes.
    Keywords: émissions de dioxyde de carbone (CO2),obligation d’information,décret 2017-639,valeurs de niveau 1
    Date: 2017
  36. By: Richard S.J. Tol (Department of Economics, University of Sussex, Brighton, UK; Department of Spatial Economics, Vrije Universiteit, Amsterdam; Institute for Environmental Studies, Vrije Universiteit, Amsterdam; Tinbergen Institute, Amsterdam; CESifo, Munich; Payne Institute for Earth Resources, Colorado School of Mines, Golden, Colorado)
    Abstract: The social cost of carbon is the marginal impact of climate change. Estimates of the total impact of climate change show that a century of climate change is about as bad as losing a decade of economic growth. Poorer countries are more vulnerable. The uncertainties are vast and skewed the wrong way. The many published estimates of the social cost of carbon span six orders of magnitude, and some studies find support for a carbon subsidy. There is mixed evidence for publication bias. Matlab code is used to illustrate key sensitivities of the social cost of carbon; readers can readily run their own analyses. The bulk of the published estimates suggests that carbon dioxide should be taxed somewhere between $20/tC and $400/tC, depending on the preferred rates of discount and risk aversion. Revealed preferences on carbon pricing are at the lower end of this range. The social cost of carbon rises at around 2% per year. The central estimate of the social cost of carbon has not moved much over the last two decades, but the range of estimates is tightening slowly.
    Keywords: climate change; Pigou tax; climate policy
    JEL: Q54
    Date: 2018–06

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