|
on Energy Economics |
| By: | Chyong, C.; Pollitt, M.; Cruise, R. |
| Abstract: | Using a Pan-European electricity dispatch model we find that with higher variable renewable energy (VRE) production wholesale power prices may no longer serve as a long-run signal for generation investment in 2025. If wind and solar are to be self-financing by 2025 under the current European market design, they would need to be operating in circumstances which combine lower capital cost with higher fossil fuel and/or carbon prices. In the absence of these conditions, long term subsidy mechanisms would need to continue in order to meet European renewable electricity targets. More VRE production will exacerbate the ‘missing money’ problem for conventional generation. Thus, closures of unprofitable fossil fuel generation would sharpen and increase energy-only prices but would put more pressure on ancillary services markets to support system stability. Thus, the question of the need for a market redesign to let the market guide investments in both renewables and conventional generation would seem to remain. |
| Keywords: | electricity market design, electricity regulation, wind energy, solar energy, electricity generation investment, ancillary services, capacity renumeration mechanisms, energy-only prices |
| JEL: | L94 L98 L51 Q48 Q41 C61 |
| Date: | 2019–06–20 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:1955&r=all |
| By: | Robert Stavins |
| Abstract: | There is widespread agreement among economists – and a diverse set of other policy analysts – that at least in the long run, an economy-wide carbon pricing system will be an essential element of any national policy that can achieve meaningful reductions of CO2 emissions cost-effectively in the United States. There is less agreement, however, among economists and others in the policy community regarding the choice of specific carbon-pricing policy instrument, with some supporting carbon taxes and others favoring cap and trade mechanisms. This prompts two important questions. How do the two major approaches to carbon pricing compare on relevant dimensions, including but not limited to efficiency, cost-effectiveness, and distributional equity? And which of the two approaches is more likely to be adopted in the future in the United States? This paper addresses these questions by drawing on both normative and positive theories of policy instrument choice as they apply to U.S. climate change policy, and draws extensively on relevant empirical evidence. The paper concludes with a look at the path ahead, including an assessment of how the two carbon-pricing instruments can be made more politically acceptable. |
| JEL: | Q40 Q48 Q54 Q58 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25912&r=all |
| By: | Julien Hanoteau (KEDGE Business School [Marseille], AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - Ecole Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique); David Talbot (ENAP - École nationale d'administration publique - École nationale d'administration publique) |
| Abstract: | In 2013, Québec implemented a greenhouse gas (GHG) emissions trading system (QC ETS), despite opposition from industry, which feared loss of competitiveness and warned about job destruction. This article assesses the impact of that carbon regulation on industrial facilities in Québec. Conditional difference-in-differences ordinary least squares regressions show that regulated plants reduced their GHG emissions by about 9.8%, employment by about 6.8% and carbon intensity by about 3.7% more compared to non-regulated plants in the rest of Canada during the period 2013–2015. This suggests that facilities adapted to the new program by improving their technology, but first and foremost by scaling down their activity, which raises questions about the ability of the QC ETS to induce enough environmental investment and innovation in industrial facilities. The results, in terms of employment effects, contrast with the findings of similar studies on the early stages of the European ETS and the British Columbia carbon tax scheme, and this information challenges the initial allocation scheme for permits, in particular, with a view to a green fiscal reform. |
| Keywords: | Environmental regulation,carbon market,employment,climate policy |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02151028&r=all |
| By: | Étienne Latulippe; Kun Mo |
| Abstract: | The market for electric vehicles (EVs) is growing rapidly. Subsidies and technological improvements are expected to increase the market share of EVs over the coming decade. In its base-case scenario, the International Energy Agency (IEA) expects EV use to rise from 4 million vehicles in 2018 to 120 million by 2030, or from 0.3 per cent to over 7 per cent of the global car fleet. However, depending on environmental policy decisions, the number of EVs on the road by 2030 could reasonably range between 57 million and 300 million (4 to 19 per cent of the global fleet). The switch to EVs will have important implications for the global oil market. Our analysis shows that for every additional 100 million EVs on the road in 2030, gasoline consumption would fall by about one million barrels of oil per day and oil prices would be 4 per cent lower. Applying this rule-of-thumb to IEA’s base-case oil price projection of US$90 for 2030, we find that different assumptions on the size of the EV fleet can reasonably push oil prices within a range of US$85 to US$93. |
| Keywords: | International topics |
| JEL: | Q47 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocsan:19-19&r=all |
| By: | Sasu-Boakye, Yaw; Valin, Hugo; Wirsenius, Stefan; Havlik, Petr; Hedenus, Fredrik; Frank, Stefan; Herrero, Mario |
| Abstract: | The European Parliament recently adopted a plan for a European strategy for the promotion of protein crops for food and feed. While the motivation is to reduce further deepening of the dependence on third-party imports, it is also anticipated that increased sourcing of protein feed from the EU will contribute to reduce deforestation and lower GHG emission footprint from EU livestock production. However, a significant part of the protein meals currently sourced from the EU is the result of a different policy, the Renewable Energy Directive, that promotes the use of vegetable oil for fossil fuel substitution in the EU transportation sector. This paper compares two different strategies to decrease reliance of the EU feed protein market to imports - direct support to oilseed production, and incorporation targets for biodiesel in transport. We assess GHG emission impacts of these scenarios using GLOBIOM, a partial equilibrium model of agriculture and land use, enriched with detailed representation of the oilseed supply chains. The results show that direct substitution of soybean feed with protein meal from rapeseed and sunflower decreases deforestation related GHG emissions even though increased demand for agricultural land contributes to higher GHG emissions from agricultural production. Direct substitution of soybean feed leads to net savings if the protein crops are sourced from Europe. However, when a demand for vegetable oil-based biofuel is introduced as the primary driver of feed substitution, the land-use emissions go in opposite direction, with net increase in overall GHG emissions, partly due to additional imports of palm oil from Southeast Asia. Therefore, a supply-oriented policy targeting domestic protein and oil crops appear environmentally preferable to sponsoring demand of vegetable oil for energy use, which shows the importance of connecting better the discussions on the Renewable Energy Directive and the European strategy for the promotion of protein crops for food and feed. |
| Keywords: | Agricultural and Food Policy |
| Date: | 2019–05–29 |
| URL: | http://d.repec.org/n?u=RePEc:ags:eaa172:289709&r=all |
| By: | Walter, Jason; Raff, Zach |
| Abstract: | The U.S. EPA designates areas as in non-attainment with National Ambient Air Quality Standards (NAAQS) if ambient air concentrations of certain pollutants exceed standard levels. Stationary sources located in these areas are required to significantly reduce emissions through technological and other requirements; these sources are also subjected to greater regulatory oversight. However, non-attainment is not a permanent designation and regulatory oversight subsides once an area moves out of non-attainment. In this paper we examine whether the additional regulatory oversight of non-attainment designation is successful (and necessary) at reducing emissions from stationary sources. We estimate the effects of an area moving out of non-attainment on emissions at coal-fired power plants located in these areas. We first model the actions of utility managers subjected to emission reduction requirements. The model suggests that firms under additional scrutiny via non-attainment designation intentionally lower emissions. However, when areas exit non-attainment, i.e., direct regulatory oversight subsides, firms under-utilize clean strategies-including technology-which results in emission increases. Empirical analysis results show that boilers with abatement technology installed as a result of non-attainment increase NO x emissions and emission rate by 16% and 9%, respectively, when exiting non-attainment. Extended model results present evidence that regulated firms are less likely to use fully emission control methods in the absence of direct regulatory oversight. Specifically, the emission increases of exiting non-attainment are driven by the under-utilization of abatement technology inputs and the switch to lower quality fuel. |
| Keywords: | Coal-fired power plants; environmental regulation; National Ambient Air Quality Standards; nitrous oxide; sulfur dioxide |
| JEL: | D21 Q53 Q58 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94158&r=all |
| By: | Sinha, Avik; Gupta, Monika; Shahbaz, Muhammad; Sengupta, Tuhin |
| Abstract: | This study investigates the impact of corruption in public sector on carbon emissions in presence of energy use segregation, following the Environmental Kuznets Curve (EKC) framework. The study has been carried out for Brazil-Russia-India-China-South Africa (BRICS) and Next 11 countries over the period of 1990-2017. Along with the finding of inverted N-shaped EKC for both the cases, we find that incidents of corruption enhance environmental degradation by reducing the positive impact of renewable energy consumption on environmental quality, and increasing the negative impact of fossil fuel consumption. This study has also divulged that the corruptive practices are more prone in case of the countries, where the development is mature and institutionalization is more stringent. Based on these findings, we suggest that environmental policies should take account of the corruption, and thereby, making the policies more robust and effective. |
| Keywords: | Environmental Kuznets Curve; CO2 Emissions; Corruption; Next 11; BRICS |
| JEL: | Q5 |
| Date: | 2019–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94357&r=all |
| By: | Ritter, Hendrik; Zimmermann, Karl |
| Abstract: | We assess a 2-period, non-cooperative equilibrium of an n country policy game where countries chose either (i) carbon taxes, (ii) cap-and-trade policy with local permit markets or (iii) cap-and-trade policy with internationally linked permit markets and potential central redistribution of permit revenues. Policy makers maximizes welfare, which depends on household consumption over time and environmental damage from period-1 resource use. We assume costless and complete extraction of this non-renewable resource, so damage only depends on speed of extraction. Tax policy is the least efficient option due to carbon leakage, which introduces a second externality adding to the environmental externality. Cap-and-trade policy does not show any leakage since all symmetric countries will employ caps. Its equilibrium thus only suffers from the environmental externality and welfare is higher than under carbon taxation. The policy scenario with linked permit markets and central redistribution yields an efficient outcome. The redistribution of revenues creates a negative externality which offsets the positive environmental externality. |
| Keywords: | Climate Policy,Carbon Tax,Cap-and-Trade Policy,Linked Permit Markets |
| JEL: | H23 Q38 Q54 Q58 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:197796&r=all |
| By: | Hu, Bin; Li, Zhengtao; Zhang, Lin |
| Abstract: | This paper estimates the linkages among total Sulphur dioxide (SO2) emissions, total GDP and energy efficiency using China’s provincial panel data from 2002 to 2015. We investigate total emissions rather than per capita emissions or ambient concentrations, since it is total emissions that the environment cares about. Energy efficiency is estimated using stochastic frontier analysis and decomposed into both persistent and transient efficiency. We then investigate the long-run dynamics among SO2 emissions, economic growth and energy efficiency by employing the panel-based error correction model and taking the effects of cyclical variations into account. Our analysis shows that GDP has a positive impact on total SO2 emissions in the short run and gains in energy efficiency have a significant negative effect on emissions in the long run. By controlling the effects of business cycle, the effects of GDP on emissions remain positive in both short and long run. Cross-sectional analysis provides similar insights. We argue that economic growth itself is an emission generator. Therefore, the government needs to establish a long-run strategy to curb the emissions by improving energy efficiency. |
| Keywords: | Sulphur dioxide emissions; energy efficiency; stochastic frontier analysis; error-correction model |
| JEL: | Q0 Q01 Q43 Q56 |
| Date: | 2019–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94588&r=all |
| By: | Reto Bertoni (Universidad de la República (Uruguay). Facultad de Ciencias Sociales. Programa de Historia Económica y Social); Henry Willebald (Universidad de la República (Uruguay). Facultad de Ciencias Económicas y de Administración. Instituto de Economía) |
| Abstract: | The configuration of a “modern” production structure requires there to be sufficient energy supply at competitive costs to justify exploiting the corresponding natural resources. New Zealand’s better economic performance, since the last third of the 19th century in coal production and better natural conditions to generate electric energy at low cost –thus offering energy at low prices– explain, at least partially, the differences with respect to Uruguay. New Zealand's advantage in energy endowments facilitated the development of a dairy sector, certain energy-intensive manufactures and a more efficient use of railways that reinforced the differences between the two economies. However, endowments are not the complete story and the institutional arrangements are another relevant factor of differentiation. Our argument is based on the concept of endogeneity of natural resources and we use it to prove the hugely different roles of states in the creation and management of the electricity systems. These differences were not related to the extent of state intervention but to the achievements of such action. This action aimed at improving the welfare conditions in the case of Uruguay without paying enough attention to those aspects related to the production conditions; instead, in New Zealand, the productive development was the focus of the public intervention. The result was the creation of differential production conditions that explain the long-run divergent economic performance in terms of sector diversification and international competitiveness in favour of New Zealand. |
| Keywords: | settler economies, endogeneity of natural resources, role of state, electric system |
| JEL: | N50 N70 Q41 |
| Date: | 2019–02 |
| URL: | http://d.repec.org/n?u=RePEc:ulr:wpaper:dt-04-19&r=all |
| By: | Cai, Zhengyu (Southwestern University of Finance and Economics); Maguire, Karen (Oklahoma State University); Winters, John V. (Iowa State University) |
| Abstract: | This paper examines local labor market outcomes from an oil and gas boom in Texas. We examine two main outcomes across gender, race, and ethnicity: the probability of employment in the oil and gas industry and the log wages of workers employed outside the oil and gas industry. We find that men and women both gain employment in the oil and gas industry during booms, but such gains are much larger for men and are largest for black and Hispanic men. We also find positive income spillovers for workers in other industries that are similar in magnitude across demographic groups. |
| Keywords: | oil, natural gas, employment, gender, race, energy |
| JEL: | J20 Q33 Q40 R10 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12349&r=all |
| By: | Reinhard Ellwanger |
| Abstract: | This note presents a structural vector autoregressive (SVAR) model of the global oil market. The model identifies four types of shocks with different economic interpretations: oil supply shocks, oil-market-specific demand shocks, storage demand shocks and shocks to global economic growth. The historical decomposition of oil price fluctuations suggests that oil supply shocks were the dominant force during the 2014–15 oil price decline. Several examples illustrate the model’s usefulness for conditional forecasts of oil market variables under different scenarios for global GDP growth and oil consumption. |
| Keywords: | Economic models |
| JEL: | Q41 Q43 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:bca:bocsan:19-17&r=all |
| By: | Khazaei, Ehsan; Jamaledini, Ashkan |
| Abstract: | Islanded microgrid (MG) is one of the most important challenges in the power system operation as the network can be safe and disconnected from the conjected area. Also, in the case that the market price is high, the islanded MG can have a lower operational cost by islanding from the main grid. However, optimal operation of the islanded MG is very challenging as the MG is a nonlinear problem. Hence, this paper proposed a new heuristic method known as the JAYA optimization algorithm to solve the problem. Finally, the proposed model is examined on a modified IEEE 30 bus test network to show the merit of the model. |
| Keywords: | Power system operation, energy management, electricity market, power trading |
| JEL: | A1 G0 G1 G10 O1 O10 |
| Date: | 2019–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94279&r=all |
| By: | Snorre Kverndokk; Erik Figenbaum; Jon Hovi |
| Abstract: | Aiming to reduce the number of brown (polluting) cars on the road, several countries currently promote the purchase and use of green (emission-free) cars through financial and non-financial incentives. We study how such incentives affect consumers who continue to drive brown cars. Using a simple model, we analyze the effects of policy instruments such as subsidizing green cars, taxing brown cars, and allowing green cars to drive in bus lanes. Car owners are influenced by price incentives as well as by external effects from traffic (such as congestion) both in regular lanes and in bus lanes. An extension of the model also considers how changes in local driving habits affect brown-car driving. We find that subsidizing green cars and allowing green cars to drive in bus lanes might increase brown-car driving. We also report the results of a recent survey containing questions specifically designed to tap the significance of the model’s core mechanisms. The results are largely consistent with propositions derived from the model. While most brown-car respondents report their driving was unchanged after the implementation of the policies to promote green cars, some – particularly in major cities – report that these policies caused them to reduce or increase their driving. We conclude that some mechanisms in our model are more important than others and that certain mechanisms appear to influence different brown-car drivers in different ways. Overall, it seems that Norwegian policies to promote the purchase and use of green cars have indeed reduced brown-car driving. |
| Keywords: | electric vehicles, environmental policies, external effects, habit formation, social norms |
| JEL: | D62 H23 Q54 R42 R48 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7679&r=all |
| By: | Nooman Rebei (International Monetary Fund, Washington, DC 20431, USA); Rashid Sbia (Aix-Marseille Univ., CNRS, EHESS, Centrale Marseille, AMSE, Marseille, France & Ministry of Finance of United Arab Emirates) |
| Abstract: | This paper documents the determinants of real oil price in the global market based on SVAR model embedding transitory and permanent shocks on oil demand and supply as well as speculative disturbances. We find evidence of significant differences in the propagation mechanisms of transitory versus permanent shocks, pointing to the importance of disentangling their distinct effects. Permanent supply disruptions turn out to be a bigger factor in historical oil price movements during the most recent decades, while speculative shocks became less influential. |
| Keywords: | oil market, vector autoregressions, narrative analysis, Bayesian estimation, Kalman filtering |
| JEL: | Q41 Q43 C32 E32 G28 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:1918&r=all |
| By: | Gimenez-Nadal, J. Ignacio (University of Zaragoza); Molina, José Alberto (University of Zaragoza) |
| Abstract: | This paper analyzes how gasoline tax rates are related to the time workers in the United States spend commuting by private car, public transport, or with other physical modes of transport. Our identification strategy relies on both between-state differences and time variations in gasoline taxes. Using the American Time Use Surveys for the years 2003 to 2015, we find that higher gasoline tax rates are related with less time spent in commuting. Furthermore, higher gasoline taxes are related to a lower proportion of commuting by private car, and higher proportions of commuting by public transport and/or a physical mode of transport (e.g., walking, cycling). Our results highlight the importance of gasoline taxes (and prices) on the consumption of energy for personal transport, as higher gasoline taxes are related to a greater use of "green" modes of transport, showing that fuel taxes are important for good management of the environment. |
| Keywords: | commuting time, public transport, walking/cycling, gasoline taxes |
| JEL: | D1 Q4 R4 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp12377&r=all |
| By: | Kenneth Gillingham; Fedor Iskhakov; Anders Munk-Nielsen; John Rust; Bertel Schjerning |
| Abstract: | We introduce a computationally tractable dynamic equilibrium model of the automobile market where new and used cars of multiple types (e.g. makes/models) are traded by heterogeneous consumers. Prices and quantities are determined endogenously to equate supply and demand for all car types and vintages, along with the ages at which cars are scrapped. The model allows for transactions costs, taxes, flexible specifications of car characteristics, consumer preferences, and heterogeneity. We apply the model to two examples: a revenue-neutral replacement of the new vehicle registration tax with a higher fuel tax and a hypothetical “merger to monopoly” in an oligopolistic new car market. We show substantial gains in consumer welfare from the tax policy change, as well as important effects on government revenues, automobile prices, driving, fuel consumption and CO2 emissions, while the merger leads to substantial welfare losses. |
| Keywords: | secondary markets, trade, consumer heterogeneity, transactions costs, dynamic programming, extreme value distribution, dynamic discrete choice, multinomial logit model, stationary equilibrium, Markov chains, invariant distributions |
| JEL: | D43 D61 H21 H23 L90 Q40 Q58 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_7650&r=all |
| By: | Opeyemi Akinyemi (Covenant University, Ota, Ogun State, Nigeria); Uchenna Efobi (Covenant University, Ota, Ogun State, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon); Evans Osabuohein (Covenant University, Ota, Nigeria) |
| Abstract: | The paper investigates the dynamic relationship between renewable energy usage and trade performance in sub-Saharan Africa (SSA), while considering the conditioning role of corruption control, regulatory quality, and the private sector access to finance. Focusing on 42 SSA countries for the period 2004-2016, and engaging the System generalized method of moments (GMM) technique for its estimation, this study found a negative relationship between renewable energy usage and the indicators of trade performance. However, with corruption control, improved regulatory framework, and better finance for the private sector, there are potentials for a positive net impact of renewable energy usage on manufacturing export. For renewable energy and total trade nexus, we find that improved regulatory framework and better finance for the private sector are important conditioning structures. These findings are significant because they highlight the different important structures of SSA countries that improve the effect of renewable energy use on trade outcomes. For instance, the consideration of the financial, institutional and regulatory frameworks in SSA countries in conditioning the renewable energy-trade nexus stipulates a clear policy pathway for countries in this region as the debate for transition to the use of renewable energy progresses. |
| Keywords: | Environment; Green growth; Trade performance; Pollution |
| JEL: | C5 F1 Q4 Q5 |
| Date: | 2019–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:19/032&r=all |
| By: | Rossella Bardazzi; Maria Grazia Pazienza |
| Abstract: | Generational values inspire behaviour in numerous areas such as politics, labour markets, social cohesion, consumption and energy use. Stephenson et al. (2015) highlight the role of so-called energy culture in shaping the behaviour of different population cohorts regarding energy consumption and environmental protection, and empirical studies have confirmed the relevance of cohort effects in residential and transport-related energy use (Bardazzi and Pazienza, 2017; Chancel, 2014). This paper aims to assess how ageing and evolving generational energy cultures in Italy affect the future path of energy consumption, considering the expected changes in the Italian population size, composition and location. We use a pseudo-panel of Italian households to estimate cohort and age effects by macro-area and then we combine these effects with official demographic projections to forecast the potential consequences for energy consumption up to 2050. Our findings show that age and generation are key determinants of household behaviour regarding residential energy consumption and these effects interplay with future population dynamics, which are also area-specific due to internal migration. |
| Keywords: | Household energy demand, Pseudo-panel, Population age structure, Cohort effects |
| JEL: | D12 Q4 J11 Q56 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:frz:wpaper:wp2019_20.rdf&r=all |
| By: | Hammami, Algia; Ghenimi, Ameni; Bouri, Abdelfatteh |
| Abstract: | This paper investigates the long-run and the short-run relationship between oil prices (international oil price), US exchange rates and the Amman Stock Exchange as measured by MSCI stock market index in Jordan. The data used in this paper are monthly time series data from M1 2005 to M12 2015. To meet this ambitious objective, we use VECM method. Our results show that the Jordan stock market prices have a relationship with two macroeconomic variables. Nevertheless, oil prices have significantly long and short-run negative effect on stock prices contrary to the US exchange rate that has a significant negative effect on stock prices only in the short term. |
| Keywords: | VECM, Crude Oil Price, US Exchange Rate, Jordan Stock Market |
| JEL: | G0 |
| Date: | 2019–06–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94570&r=all |
| By: | Ackrill, Rob; Abdo, Hafez |
| Abstract: | In recent years, the multifunctionality of farming activities and diversification of on-farm income sources have increasingly included the generation of renewable energy. The uptake of on-farm anaerobic digestion, however, continues to lag behind other renewable energy sources, notably wind and solar. The purpose of this paper is to provide an in-depth analysis of the policy barriers that might explain this relative absence of anaerobic digestion from UK farming. This is doubly important, given that anaerobic digestion is not only a potential source of renewable energy, but also a means of waste management within certain farming systems. The analysis draws on a mixed-methods research project, with data from 153 responses to a questionnaire sent to farmers in Nottinghamshire and Derbyshire in March 2016; 18 in-depth interviews with stakeholders in the anaerobic digestion sector; and a workshop that brought together stakeholders in a round-table discussion. The qualitative data are coded and then analysed utilising a model of policy analysis that distinguishes between three levels of policy means and policy ends. The findings of this analysis provide important insights into the challenges of devising a policy that can effectively promote on-farm anaerobic digestion. |
| Keywords: | Environmental Economics and Policy, Resource /Energy Economics and Policy |
| Date: | 2019–04–15 |
| URL: | http://d.repec.org/n?u=RePEc:ags:aesc19:289681&r=all |
| By: | Nicholas Z. Muller |
| Abstract: | This paper estimates an augmented measure of national output inclusive of environmental pollution damage in the United States economy over a 60-year period. The paper reports two primary findings. First, air pollution intensity declined precipitously from the 1950s to the modern era. Air pollution damage comprised roughly 30 percent of output in the post WWII economy, declining to under 10 percent in 2016. Second, accounting for pollution damage significantly affects growth rates. Prior to the passage of the Clean Air Act in 1970, GDP outpaced Environmentally-Adjusted Value Added (EVA), defined as GDP less air pollution damage. Following passage of the Act, EVA grew more rapidly than GDP. Macroeconomic and environmental policies, as well as the business cycle, appreciably affect damages and EVA growth. |
| JEL: | O44 Q51 Q53 Q56 Q58 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:25910&r=all |
| By: | Bensch, Gunther; Peters, Jörg |
| Abstract: | Free technology distribution can be an effective development policy instrument if market-driven adoption is socially inefficient and hampered by affordability constraints. Yet, policy makers often oppose free distribution, arguing that reference dependence lowers the willingness to pay (WTP) and thus market potentials in the long run. For improved cookstoves, this paper studies the WTP six years after a randomized one-time free distribution in 2009. We demonstrate that the cookstoves were intensely used by the treatment group households in the years after randomization until they reached their designated lifetime. Using a real-purchase offer, we find that both treatment and control households reveal a remarkably high WTP in 2015. The estimated confidence interval suggests that we can exclude a substantial negative effect on the treatment group. The policy implication is that one-time free distribution does not necessarily undermine future market establishment and thus can be an effective policy instrument if rapid dissemination is the objective. |
| Keywords: | energy access, real-purchase offer, reference dependence, supply chains, technology adoption, willingness to pay |
| JEL: | D03 D12 O12 O13 Q41 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94211&r=all |
| By: | Dolatiary, Soheil; Rahmani, Javad; Khalilzad, Zahra |
| Abstract: | The optimal sizing and placement of Distributed Generation units (DG) are becoming very attractive to researchers these days. In this paper a two stage approach has been used for allocation and sizing of DGs in distribution system with time varying load model. The strategic placement of DGs can help in reducing energy losses and improving voltage profile. The proposed work discusses time varying loads that can be useful for selecting the location and optimizing DG operation. The method has the potential to be used for integrating the available DGs by identifying the best locations in a power system. The proposed method has been demonstrated on 9-bus test system. |
| Keywords: | Distribution Generation (DG), Optimal placement, Time-varying load, Load profile, Energy losses |
| JEL: | L6 L9 L94 L96 |
| Date: | 2018 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94194&r=all |
| By: | Wachsmuth, Jakob; Denishchenkova, Alexandra; Fekete, Hanna; Parra, Paola; Schaeffer, Michiel; Ancygier, Andrzej; Sferra, Fabio |
| Abstract: | The current nationally determined contributions of the Parties to the Paris Agree-ment are far from being sufficient to achieve the long-term goal to limit global warming. Therefore, the question of how to distribute the global mitigation burden among the Parties in a fair and cost-effective way remains topical. In this paper, approaches based on different fairness criteria and the criterion of cost-effective-ness are applied to a global emission budget compatible with the Paris targets and evaluated for the globally largest emitters including the EU as well as Ger-many. The results show that domestic mitigation efforts need to be increased in the majority of those countries even more than for the below-2êC limit of the Can-cun Agreements. Moreover, even if the cost-effective level is assumed to be reached, there remains a strong need for support by the historical large emitters to others from a fairness perspective. |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fisisi:s042019&r=all |
| By: | Khazaei, Ehsan; Jamaledini, Ashkan |
| Abstract: | This paper investigates the optimal operation of the islanded microgrid. In order to find the optimal solution and also provide a fast response, a new heuristic method, which is known as the chaotic crow search optimization algorithm is developed. To show the merit of the model, it is tested on the IEEE 30 bus test network. |
| Keywords: | Power system operation, Distribution Grid, Power system Economics, Energy market |
| JEL: | A1 C0 C00 H0 M0 M00 |
| Date: | 2019–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94278&r=all |
| By: | Tayeb, Hamza; Masih, Mansur |
| Abstract: | The purpose of this study is to explore the Granger-causal relationship between oil prices, exchange rates and inflation rates using Thailand as a case study. Discerning this relationship will help us understand the mechanics of the Thai economy and the factors contributing to its development. Standard time-series and ARDL methods were used to investigate this relation. The reason for choosing to apply both methods is that ARDL is a more robust technique than the standard time series technique. Also, ARDL helped us overcome a problem regarding the variables used in the study as we had a mix of I(0) and I(1) variables which is unacceptable under the standard time-series technique when cointegration of the variables is examined. Our empirical findings tend to indicate that there is a long run relationship existing between these variables and that the exchange rate appears to be the variable leading oil prices and inflation at least in the context of Thailand during the period under review. The results are reasonable and have strong policy implications. |
| Keywords: | Oil Price, Exchange Rate, Inflation, Thailand, cointegration, exogeneity, endogeneity |
| JEL: | C58 G15 |
| Date: | 2018–06–30 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94197&r=all |
| By: | Simon Schn\"urch; Andreas Wagner |
| Abstract: | This paper employs machine learning algorithms to forecast German electricity spot market prices. The forecasts utilize in particular bid and ask order book data from the spot market but also fundamental market data like renewable infeed and expected demand. Appropriate feature extraction for the order book data is developed. Using cross-validation to optimise hyperparameters, neural networks and random forests are proposed and compared to statistical reference models. The machine learning models outperform traditional approaches. |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:1906.06248&r=all |
| By: | Teodora Diana Corsatea; Soeren Lindner; Inaki Arto (Basque Centre for Climate Change (BC3)); Maria Victoria Roman (European Commission – JRC); Jose Manuel Rueda-Cantuche (European Commission – JRC); Agustin Velezquez Afonso (European Commission – JRC); Antonio F. Amores (European Commission – JRC); Frederik Neuwahl (European Commission – JRC) |
| Abstract: | This report describes the approach adopted for the update of the World Input-Output Database (WIOD) environmental accounts for the period 2000-2016. In constructing the WIOD-based energy and emission accounts we follow closely the methodology developed by Genty et al. (2012), with some adjustments due to changes in system boundaries, which are further detailed. This report illustrates the data adjustment steps required to reconcile energy and economic data which stem, for example, from different accounting principles. Special care has been taken to address problems related to time series breaks in order to achieve a smooth transition between the years 2009 and 2010 at the intersection between the original and new WIOD releases. Results for EU countries are compared with other data sources such as the previous WIOD time series, the Physical Energy Flows Accounts (PEFA) and the National Accounts Matrices with Environmental Extensions (NAMEA) showing a satisfactory goodness of fit, with some exceptions. A final comparison of the inter-temporal structure across periods is proposed in order to identify possible reasons of changes in the patterns of gross energy use. |
| Keywords: | Energy accounts, Emission accounts, World Input-Output Database |
| JEL: | C67 E01 |
| Date: | 2019–05 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc116234&r=all |
| By: | Gbologah, Franklin E.; Rodgers, Michael O.; Li, Hanyan "Ann" |
| Abstract: | The U.S. Environmental Protection Agency identified the use of low rolling resistance (LRR) tires as an effective method of reducing vehicle fuel consumption, especially from heavyduty vehicles (HDV). LRR tires are important to HDV operations because fuel accounts for about 25% of operating costs, and improving fuel economy also reduces emissions of both greenhouse gases and oxides of nitrogen, a precursor to the formation of ozone, which is harmful to humans, plants, and animals. However, their adoption rate has been slow primarily due to performance uncertainties under real-world operating conditions. Previous mathematical models developed to help fleet operators estimate the impact of LRR tires on their operations have suffered from poor accuracy because they do not account for variable speed profiles in realworld HDV operations. Georgia Tech researchers have developed a new tool for fleet managers that better predicts the benefits of LRR tires under real-world conditions. View the NCST Project Webpage |
| Keywords: | Engineering, Data analysis, Fleet management, Fuel consumption, Heavy duty vehicles, Rolling resistance, Simulation, Tires, Tractor trailer combinations, Traffic speed, Vehicle fleets |
| Date: | 2019–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsdav:qt6cg510sf&r=all |
| By: | Corinne Langinier; Amrita Ray Chaudhuri |
| Abstract: | We develop a theoretical framework to investigate the impact of patent policies and emission taxes on green innovation that reduces the emission output ratio, and on the emission level. In the absence of green consumers, the introduction of patents results in a paradox whereby increasing emission tax beyond a certain threshold leads to a discrete increase in the emission level, which may be avoided by reducing the patenting cost. In the presence of green consumers, this paradox is restricted to an intermediate range of tax rates, and at suffciently high tax rates, reducing the patenting cost may increase the emission level. Also, higher emission taxes increase green investment only if the fraction of green consumers is sufficiently small, and the magnitude of this effect decreases as this fraction increases. Moreover, a stricter patentability requirement is only effective at reducing emissions if the fraction of green consumers is sufficiently small. |
| JEL: | O34 L13 Q50 |
| URL: | http://d.repec.org/n?u=RePEc:win:winwop:2019-02&r=all |
| By: | Youcef Mechouar (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes - CNRS - Centre National de la Recherche Scientifique); Vincent Hovelaque (CREM - Centre de recherche en économie et management - UNICAEN - Université de Caen Normandie - NU - Normandie Université - UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes - CNRS - Centre National de la Recherche Scientifique); Carl Gaigné (SMART - Structures et Marché Agricoles, Ressources et Territoires - INRA - Institut National de la Recherche Agronomique - AGROCAMPUS OUEST); Christian Vigouroux (IGR-IAE Rennes - Institut de Gestion de Rennes - Institut d'Administration des Entreprises - Rennes - UR1 - Université de Rennes 1 - UNIV-RENNES - Université de Rennes) |
| Abstract: | Current environmental issues and challenges have a direct impact on firms' strategic and operational decisions in terms of location, transport and production. In this work, we propose to investigate a firm that reconsiders its location and production decisions under a carbon tax policy on transport-related carbon emissions. Traditionally sustainable facility location models under carbon pricing scheme assume that firm supply is given (complementary essential inputs). In our framework, input mix and location decision are allowed to vary simultaneously. The relationship between the production level and the input quantities is captured through a production function that enables different degrees of substitutability among the raw material quantities. The results show that variation in the elasticity of substitution across the different types of inputs affects the firm location and supply choices. Moreover, it plays a crucial role in controlling the level of the pollution stemming from commodity shipping through adjustments in the input supply quantities. Our analysis also reveals the sensitivity of the facility location decision to a higher carbon tax when firm has a high flexibility on its ability to substitute among the input quantities. |
| Keywords: | facility location,raw material substitution,Environmental issues,carbon tax,sustainability |
| Date: | 2019–06–25 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-02129628&r=all |
| By: | Afees A. Salisu (Department for Management of Science and Technology Development, Ton Duc Thang University, Ho Chi Minh City, Vietnam and Faculty of Business Administration, Ton Duc Thang University, Ho Chi Minh City, Vietnam); Rangan Gupta (Department of Economics, University of Pretoria, Pretoria, South Africa) |
| Abstract: | In this study, we utilize the recent oil shock data of Baumeister and Hamilton (2019) to analyze how housing returns in China, India and Russia respond to different oil shocks. Given the available data for the relevant variables, the MIDAS approach which helps circumvent aggregation problem in the estimation process is employed. We also extend the MIDAS framework to account for nonlinearities in the model. Expectedly, the housing returns of the countries considered respond differently to the variants of oil shocks. More specifically, we find that the housing returns of India and China which are net oil-importing countries do not seem to possess oil risk hedging characteristics albeit with the converse for Russia which is a major net oil-exporter. We also find that modeling with the MIDAS framework offers better predictability than other variants with uniform frequency. |
| Keywords: | Housing return, Oil shock, MIDAS regression, Nonlinearities, Forecasting |
| JEL: | C12 C22 Q41 Q47 R12 R31 |
| Date: | 2019–06 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:201946&r=all |
| By: | Jamaledini, Ashkan; Khazaei, Ehsan; Bitaraf, Mohammd |
| Abstract: | This paper aims to investigate the optimal operation of grid-connected microgrids (MG). In the grid-connected mode, the MG can connect to the main utility and also can exchange energy with the main grid. This potential can lead to higher reliability and less operation cost. In order to show the effectiveness of the proposed model, it is tested on a modified IEEE 33 bus test system. |
| Keywords: | Microgrid, Jaya algorithm, Optimization, Grid-connected operation |
| JEL: | A1 A11 C0 H0 H00 |
| Date: | 2019–06–02 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94277&r=all |
| By: | Marco Ceccarelli (University of Zurich - Department of Banking and Finance; Swiss Finance Institute); Stefano Ramelli (University of Zurich - Department of Banking and Finance); Alexander F. Wagner (University of Zurich - Department of Banking and Finance; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swiss Finance Institute) |
| Abstract: | In April 2018, the investment platform and financial advisor Morningstar introduced a new eco-label for mutual funds, the Low Carbon Designation (LCD). The unexpected release of this label induced responses by (1) investors and (2) mutual funds. First, investors flocked to funds labeled as Low Carbon. Through the end of 2018, such funds enjoyed a 3.1% increase in assets compared to otherwise similar funds. This effect was distinct from that of more generic sustainability ratings ("Globes"), and it reversed for funds that lost the label in August or November 2018. Second, managers of just-missing funds adjusted their holdings towards lower carbon risk and lower fossil fuel involvement, the two criteria used to assign the LCD. Both the rewards-for-LCD and the moving-towards LCD effects are stronger for European funds, retail funds, funds with weak financial performance, and low-sustainability funds. Overall, the findings suggest that financial intermediaries actively compete for flows driven by the increasing demand for climate-conscious investment products. |
| Keywords: | behavioral finance, climate change, eco-labels, investor preferences, mutual funds, sustainable finance |
| JEL: | D03 G02 G12 G23 |
| Date: | 2019–03 |
| URL: | http://d.repec.org/n?u=RePEc:chf:rpseri:rp1913&r=all |
| By: | Khatri, Krishna |
| Abstract: | This paper studies the performance of a passive linear tuned mass damper on controlling motion of a floating wind turbine. Controlled and uncontrolled analytical models of the spar FWT is established using Newton’s second law and conservation of angular momentum theory. The aerodynamic, hydrodynamic, mooring and buoyancy forces are determined and coupled with the system. For the controlled model, the TMDs are located in different locations and are tuned to different frequency ratios to reduce the motion of the FWT in different directions. The economic optimal design values are considered for the passive controller. The control performance is evaluated by the reduction of root mean square response in each degree of freedom. The results reveals that the linear TMD tuned to the frequency of pitch degree of freedom reduces the translational motion and rotational motion by 5% and 12% respectively. However, tuning the linear tuned mass damper to the frequency of surge degree of freedom provides 8% and 6% motion reduction in translational and rotational degrees of freedom. Also, it has been shown that installing the linear TMD inside the spar is more effective than installing the TMD inside the nacelle. |
| Keywords: | Spar floating wind turbine; conservation of angular momentum; linear tuned mass damper; passive control; economic optimization |
| JEL: | A1 C0 C02 C5 C6 C61 |
| Date: | 2019–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:94447&r=all |
| By: | Soumendra N. Banerjee; Jayjit Roy; Mahmut Yasar |
| Abstract: | The relevance of analyzing whether exporting rms engage in greater pollution abatement cannot be overemphasized. For instance, the question relates to the possibility of export promotion policies being environmentally benecial. In fact, the issue is especially relevant for developing countries typically characterized by ine/ective environmental regulation. However, despite the signicance of the topic, the extant literature examining the environmental consequences of rm-level trade is skewed toward developed countries. Moreover, the existing contributions rarely attend to concerns over non-random selection into exporting. Accordingly, we employ cross-sectional data across Indonesian rms as well as a number of novel identication strategies to assess the causal e/ect of exporting on abatement behavior. Two of the approaches are proposed by Millimet and Tchernis (2013), and entail either minimizing or correcting for endogeneity bias. The remaining methods, attributable to Lewbel (2012) and Klein and Vella (2009), rely on higher moments of the data to obtain exclusion restrictions. While we largely nd exporting to encourage pollution abatement, the estimated impacts are more pronounced after accounting for selection into exporting. Key Words: Exporting, Environment, Pollution Abatement, Instrumental Variables, Treatment Efects |
| JEL: | C26 F18 F23 Q4 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:apl:wpaper:19-10&r=all |
| By: | Cheikh A. Gueye; Asithandile Mbelu; Amadou N Sy |
| Abstract: | This paper studies the impact of declining oil prices on banks in sub-Saharan African oil-exporting countries. Results indicate that banks respond differently to an oil shock depending on their ownership: (i) domestic banks are the most adversely impacted and experience a deterioration in asset quality and liquidity; (ii) foreign-owned banks are the most resilient as they are able to improve asset quality and attract deposits but at the same time, they decelerate credit growth; in contrast, (iii) Pan-African Banks help stabilize overall credit but large banks in that segment experience reduced asset quality. These differentiated results suggest a tradeoff between maintaining credit growth and safeguarding financial stability in an oil slump which could be addressed by both micro- and macroprudential policies. |
| Date: | 2019–06–17 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:19/129&r=all |
| By: | Eric Jondeau (University of Lausanne - Faculty of Business and Economics (HEC Lausanne); Swiss Finance Institute); Qunzi Zhang (Shandong University); Xiaoneng Zhu (Shanghai University of Finance and Economics) |
| Abstract: | Oil price changes fail to predict asset returns because they are too noisy. We construct an oil trend factor that fi lters out noise and provide evidence that it predicts bond risk premiums well. This result holds in developed and emerging markets, both in sample and out of sample. Notably, the oil trend factor improves predictions based on current term structure predictors, such as the first three principal components of yields and the Cochrane and Piazzesi (2005) factor. A puzzle emerging from our results is that oil price increases, which are generally thought to precede economic recessions, are in fact associated with subsequent lower bond returns. To solve this puzzle, we demonstrate that not all oil price shocks are alike: Although oil demand and supply shocks have opposite implications for economic activity and bond risk premiums, the oil trend factor is mainly related to demand shocks. Therefore, increases in the oil trend tend to signal a strong economy and lower bond returns. |
| Keywords: | bond risk premium, demand shocks, oil prices, return predictability |
| JEL: | G11 G12 G15 P36 |
| Date: | 2019–04 |
| URL: | http://d.repec.org/n?u=RePEc:chf:rpseri:rp1924&r=all |
| By: | Gaspar Núñez Rodríguez |
| Keywords: | Applied General Equilibrium Model; Social Accounting Matrix; Mexico; taxes; hydrocarbons; extraction; Modelo de Equilibrio General Aplicado; Matriz de Contabilidad Social; México; impuestos; extracción; hidrocarburos. |
| JEL: | C68 D58 D69 H22 |
| Date: | 2018–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:col:000418:017299&r=all |
| By: | Fabien Candau (CATT - Centre d'Analyse Théorique et de Traitement des données économiques - UPPA - Université de Pau et des Pays de l'Adour) |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02140435&r=all |