|
on Energy Economics |
| By: | AGUIR BARGAOUI, Saoussen |
| Abstract: | The climate change matter is due to Green House Gas Emissions produced essentially by CO2 emissions. To overcome this problem, decision markers developed several policies among them the adoption of energy efficient measures and the development of renewable energies. Using a panel data analysis, this paper tries to investigate the impact of adoption of such solutions on emissions levels for 161 countries during the period 1985-2014. Estimation results demonstrate that the magnitude of emissions reduction is more important for energy efficiency and that the role of renewable energy still insufficient yet. Furthermore, we proved that non-renewable energy, income per capita and population growth are destructive facts of environmental quality. |
| Keywords: | renewable energy, non-renewable energy, panel data, energy efficiency, carbon dioxide emissions |
| JEL: | Q20 Q30 Q42 Q51 Q56 |
| Date: | 2019 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:103853&r=all |
| By: | Jesse F. Buchsbaum; Catherine Hausman; Johanna L. Mathieu; Jing Peng |
| Abstract: | In electricity markets, generators are rewarded both for providing energy and for enabling grid reliability. The two functions are compensated in separate markets: energy markets and ancillary services markets. We provide evidence of changes in the fuel mix in the energy market that is driven by exogenous changes in an ancillary services market. We provide quasi-experimental evidence and a theoretical framework for understanding the mechanism, showing that it results from the multi-product nature of conventional power plants combined with discontinuities in costs. As a result, policy changes relating to grid operations, grid reliability, or climate change could have unintended effects. As an example, our results have particular relevance given the increased deployment of batteries for ancillary services -- we show that such deployment has the potential to increase carbon dioxide emissions in the short term. |
| JEL: | L21 L94 L98 Q42 Q48 Q53 Q58 |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:28027&r=all |
| By: | Sylwia Bialek; Burcin Unel |
| Abstract: | We evaluate the effects of homogeneous subsidies granted for emission-free electricity generation on market outcomes and social welfare. We use an analytical model to assess the conditions under which such subsidies increase efficiency of wholesale energy and capacity markets. While the subsidies, even when combined with energy consumption taxes, cannot achieve first-best outcomes when there are resources with heterogeneous emission intensities, there exists a range of subsidy rates that are welfare-enhancing when greenhouse gas externalities are taken into account. We also derive the conditions under which generation subsidies do not affect the equilibrium price in capacity markets. Finally, we evaluate the capacity market reforms that are being undertaken in the U.S. in response to these kinds of subsidies. |
| Keywords: | capacity markets, renewables, subsidies, welfare |
| JEL: | Q28 Q42 Q58 Q41 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8673&r=all |
| By: | Fait, Larissa; Wetzel, Heike; Groh, Elke D. |
| Abstract: | The success of the energy transition is important in order to limit climate change and its consequences. However, the expansion of renewables faces several challenges. In particular, there is growing resistance to renewable projects at the local level. Therefore, we examine preferences for regionally produced green electricity as a way to increase acceptance. In addition, we investigate whether regional or environmental identity have an influence on these preferences. Therefore, we analyse data from a choice experiment conducted with 672 regional consumers in Germany. The sample is divided into 3 subgroups that face different priming treatments in order to determine the effects of identity salience. Our results show that, in addition to a green electricity mix, consumers have positive preferences for regional aspects of electricity contracts, such as the regional production or the regional ties of electricity suppliers. Moreover, respondents who were primed with their regional or environmental identity show a significantly higher willingness to pay for these attributes. While the priming for environmental identity strengthens the existing preferences, the regional priming seems to influence the underlying decision heuristics. Overall, our findings indicate that there is a clear preference for regional electricity and therefore it would be reasonable for electricity providers to offer regional electricity. Environmental and regional aspects should be emphasised in marketing, as these can have a significant impact on electricity contract choice. |
| JEL: | C25 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224574&r=all |
| By: | Hintermayer, Martin |
| Abstract: | Despite the reform of the European Emissions Trading System (EU ETS), discussions about complementing it with a carbon price floor (CPF) are ongoing. This paper analyzes the effect of a European CPF in the reformed EU ETS using a Hotelling model of the EU ETS, amended by the market stability reserve (MSR), and the cancellation mechanism. Two CPF designs are compared: (1) a buyback program and (2) a top-up tax. The buyback program sets a minimum price for the allowances from the implementation year onwards. After the announcement, firms anticipate the CPF, which immediately increases the carbon price to the discounted CPF level. Therefore, firms emit less and bank more allowances, leading to more intake into the MSR, and more cancellation of allowances. The top-up tax imposes a tax on emissions, which enhances the market price of allowances to the CPF level from the implementation year onwards. Firms increase their short-run emissions in anticipation of the upcoming tax. Only after the implementation year firms start to lower their emissions. Thus, the effect on aggregate cancellation is ambiguous. Despite being equivalent in a static setting, the design choice for the CPF matters in a dynamic context, such as the EU ETS. |
| Keywords: | Intertemporal Emission Trading,Carbon Price Floor,EU ETS |
| JEL: | H23 H32 Q58 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224576&r=all |
| By: | Schopf, Mark |
| Abstract: | The present paper analyzes the impact of a climate coalition's border carbon adjustment on emissions from commodity production, welfare and the coalition size. The coalition implements border carbon adjustment to reduce carbon leakage and to improve its terms of trade, while the fringe abstains from any trade policy. With symmetric countries, the optimal import tax or export subsidy is positive but smaller than the coalition's implicit emission price. With a linear-quadratic specification, the coalition exports the commodity. Total emissions decrease with the coalition size, and total welfare increases [decreases] with the coalition size if the coalition is large [small]. Then, the reduced climate costs outweigh [are outweighed by] the increased trade distortions. The unique stable coalition consists of three or more countries, including the grand coalition, and raises the welfare of each country compared to the business-as-usual equilibrium. If no [each] country implements a trade policy, the stable coalition consists of two [three] or less countries. Compared to the case in which only the coalition implements border carbon adjustment, the welfare of each country is reduced [if the stable coalition then consists of four or more countries]. All results are derived analytically. |
| Keywords: | Carbon Leakage,Climate Change,Environmental Policy,Nash Equilibrium,Terms of Trade |
| JEL: | F13 F18 H23 Q54 Q56 Q58 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224560&r=all |
| By: | Kolev, Galina |
| Abstract: | The paper represents a new reading of the traditional Ricardian theory of comparative advantages to tackle current challenges of environmental and climate policy. In the style of David Ricardo, it demonstrates that international trade is a positive-sum game in a twogoods, two-countries world where CO2 emission targets constrain the production possibilities. Extending the number of goods produced and allowing for transportation costs does indeed question the tradability of a number of goods as in the classical Ricardian world. However, the main findings still apply that international trade extends the consumption possibilities while furhter enabling policy makers to achieve their CO2 emission targets. This simple framework is a useful tool to show that the outcome does not depend on the CO2 pricing method or the price of CO2 certificates in both countries. The mutual benefit of international trade depends, however, on restraining CO2 emissions according to the targets set by the Paris Agreement, since the level of CO2 emissions is the scarce factor of production in the model. |
| Keywords: | Comparative advantage,Environment and trade,Green growth |
| JEL: | F11 F18 Q56 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224646&r=all |
| By: | Emmanuel Hache (IFPEN - IFP Energies nouvelles - IFPEN - IFP Energies nouvelles, IRIS - Institut de Relations Internationales et Stratégiques, EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Marine Simoën (IFPEN - IFP Energies nouvelles - IFPEN - IFP Energies nouvelles); Gondia Sokhna Seck (IFPEN - IFP Energies nouvelles - IFPEN - IFP Energies nouvelles); Clement Bonnet (IFPEN - IFP Energies nouvelles - IFPEN - IFP Energies nouvelles); Aymen Jabberi (ECL - École Centrale de Lyon - Université de Lyon); Samuel Carcanague (IRIS - Institut de Relations Internationales et Stratégiques) |
| Abstract: | Concrete is the most widely used manmade material in the world with an annual production of about 10 billion tons globally. Its use outpaces that of historically important materials such as wood or stone in modern urbanism. Concrete is closely tied to the energy transition. As a structural material, concrete is used in multiple sectors, including energy. Because the concrete content of a power plant varies depending on the technology, the energy transition is expected to impact future demand for concrete. At the same time, concrete production is known to be highly polluting as one of its major components is cement, produced by an industry that is one of the main emitters of carbon dioxide worldwide. This dual aspect explains the aim of this study: understanding concrete (and therefore cement) demand under the energy transition policies described in the IEA's 2017 Energy Transition Policy (ETP) report and quantifying CO2 emissions from cement production for the energy sector. Based on a simple model, the study is looks at global and regional levels to take into account potential local disparities. The results demonstrate that the decarbonization of the power sector will have a limited impact on global cement demand, but that it could be more challenging for some regions where the new power production mix would require large concrete structures. This model could be a useful decision-making tool in assessing the relative impact of any public energy transition scenarios on raw materials such as cement at the highest level of disaggregation, as well as enabling better sub-sectorial screening. |
| Keywords: | construction materials,power sector,cement,concrete,Energy transition |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-02978242&r=all |
| By: | Gavard, Claire; Kirat, Djamel |
| Abstract: | The Paris Agreement established a new mechanism by which a country can offset some of its emissions reductions in other countries. Its design is still under negotiation. While taking advantage of cheaper abatement opportunities enables efficiency gains, the impact on the price volatility in the emission trading schemes is unclear. We conduct an empirical analysis of the short-term impacts of these credits on the standard carbon markets, using the European Union experience with accepting credits for compliance in the second phase of its scheme. With vector-autoregressive models allowing regime changes at a priori unknown dates, we analyze the structural relationship between the prices of allowances and credits. Although one might expect that the allowance and credit markets influence one another, we find that, before November 2011, knowing the credit price variations helps to better predict the allowance price variations while, after November 2011, it is the opposite. We explain this by expectations and restrictions regarding credits. For the transmission of shocks and the impact on volatility, the influence is mainly from allowances to credits. The allowance price volatility explains between 56% and 72% of the credit volatility whereas the latter explains less than 2% of the former. |
| Keywords: | emissions trading,European allowances,international credits,causality analysis |
| JEL: | C32 C58 F18 Q54 Q58 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:20058&r=all |
| By: | Fantazzini, Dean; Kolodin, Nikita |
| Abstract: | This paper investigates the relationship between the bitcoin price and the hashrate by disentangling the effects of the energy efficiency of the bitcoin mining equipment, bitcoin halving, and of structural breaks on the price dynamics. For this purpose, we propose a methodology based on exponential smoothing to model the dynamics of the Bitcoin network energy efficiency. We consider either directly the hashrate or the bitcoin cost-of-production model (CPM) as a proxy for the hashrate, to take any nonlinearity into account. In the first examined sub-sample (01/08/2016-04/12/2017), the hashrate and the CPMs were never significant, while a significant cointegration relationship was found in the second sub-sample (11/12/2017-24/02/2020). The empirical evidence shows that it is better to consider the hashrate directly rather than its proxy represented by the CPM when modeling its relationship with the bitcoin price. Moreover, the causality is always uni-directional going from the bitcoin price to the hashrate (or its proxies), with lags ranging from 1 week up to 6 weeks later. These findings are consistent with a large literature in energy economics, which showed that oil and gas returns affect the purchase of the drilling rigs with a delay of up to 3 months, whereas the impact of changes in the rig count on oil and gas returns is limited or not significant. |
| Keywords: | Bitcoin; energy e�ciency; mining; hashrate; bitcoin price |
| JEL: | C22 C32 C51 C53 E41 E42 E47 E51 G17 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:103812&r=all |
| By: | Kellner, Maximilian |
| Abstract: | This paper analyzes the political economy of government debt when elected politicians decide about the distribution of public funds between a clean and a polluting public good. When provision of the polluting good creates a stock of climate externalities, strategic incentives for the incumbent government arise from both a budget and emission interaction. In this framework, reelection uncertainty leads to inefficiently low public savings (or even debt) which are attenuated by the emission interaction, while first period pollution decreases regardless of the future government's identity. If the incumbent government competes for office against an environmentalists' party, the total welfare loss from emissions also decreases as a direct result of reelection uncertainty. |
| Keywords: | emission externality,public debt,political economy |
| JEL: | H23 H41 H63 Q54 Q58 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224561&r=all |
| By: | Zareena Begum Irfan (Associate Professor, Madras School of Economics); Divya Jain,; Ashwin Ram; Satarup Rakshit |
| Abstract: | Due to rapid economic expansion, India has one of the world's fastest growing energy markets and is expected to be the second-largest contributor to the increase in global energy demand by 2035, accounting for 18% of the rise in global energy consumption. Household sector is one of the largest users of energy in India, counting for about 30 per cent of final energy consumption (excluding energy used for transport) reflecting the importance of that sector in total national energy scenario. The pattern of household energy consumption represents the status of welfare as well as the stage of economic development. Household energy consumption is expected to increase in future along with growth in economy and rise in per capita incomes. This paper analysis the manifold aspects of anthropogenic activities with focus on household characteristics influencing the residential carbon dioxide emissions. Data on expenditure incurred for purchase used for both indoor and outdoor use as well as the socio-economic indicators have been taken into account to estimate their contribution to the level of emissions. The various indicators of household expenditure have been categorized separately under technological innovations, affluence, household demographics, biophysical characteristics and control variables. The theories of Ecological Modernization, Political Economy and Human Ecology have been highlighted to discuss the significance of household energy consumption pattern. Household income in India has increased considerably in line with economic growth over the last decades. In this study, household data has been extracted from India Human Development Survey- II (IHDS – II), 2011- 12 which is a cross sectional survey conducted by ICPSR 36151. The expenditures on energy consumption and emission factors are to a great extent influenced by the factors that are beyond the control of humans such as development trends regarding urban forms and infrastructure. In this study we have used household data which makes it an expanding literature to anthropogenic environmental degradation |
| Keywords: | urbanization, carbon emission, ecological modernization, energy consumption, economic expansion, human ecology, political economy |
| JEL: | C01 O31 Q4 Q55 Q18 R21 |
| URL: | http://d.repec.org/n?u=RePEc:mad:wpaper:2018-169&r=all |
| By: | Lina Silva-Rodriguez (Flemish Institute for Technological Research; EnergyVille, Belgium; Copernicus Institute of Sustainable Development - Utrecht University, Netherlands); Anibal Sanjab (Flemish Institute for Technological Research; EnergyVille, Belgium); Elena Fumagalli (Copernicus Institute of Sustainable Development - Utrecht University, Netherlands); Ana Virag (Flemish Institute for Technological Research; EnergyVille, Belgium); Madeleine Gibescu (Copernicus Institute of Sustainable Development - Utrecht University, Netherlands) |
| Abstract: | The electricity market, which was initially designed for dispatchable power plants and inflexible demand, is being increasingly challenged by new trends, such as the high penetration of intermittent renewables and the transformation of the consumers energy space. To accommodate these new trends and improve the performance of the market, several modifications to current market designs have been proposed in the literature. Given the vast variety of these proposals, this paper provides a comprehensive investigation of the modifications proposed in the literature as well as a detailed assessment of their suitability for improving market performance under the continuously evolving electricity landscape. To this end, first, a set of criteria for an ideal market design is proposed, and the barriers present in current market designs hindering the fulfillment of these criteria are identified. Then, the different market solutions proposed in the literature, which could potentially mitigate these barriers, are extensively explored. Finally, a taxonomy of the proposed solutions is presented, highlighting the barriers addressed by each proposal and the associated implementation challenges. The outcomes of this analysis show that even though each barrier is addressed by at least one proposed solution, no single proposal is able to address all the barriers simultaneously. In this regard, a future-proof market design must combine different elements of proposed solutions to comprehensively mitigate market barriers and overcome the identified implementation challenges. Thus, by thoroughly reviewing this rich body of literature, this paper introduces key contributions enabling the advancement of the state-of-the-art towards increasingly efficient electricity market. |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2011.04587&r=all |
| By: | Ben Cheikh, Nidhaleddine (ESSCA School of Management); Ben Naceur, Sami (International Monetary Fund); Kanaan, Oussama (International Monetary Fund); Rault, Christophe (University of Orléans) |
| Abstract: | This paper investigates the presence of asymmetric relationship between oil price movements and Gulf Cooperation Council (GCC) stock markets. We propose the implementation of nonlinear vector smooth transition regression (VSTR) models which offer a greater flexibility when modelling the possible asymmetric reaction in equities. Contrary to conventional wisdom, our empirical results reveal that GCC stock markets do not have similar sensitivities to oil price changes. We document that oil price changes have asymmetric effects on stock returns in some GCC countries, but not for others. More specifically, we find four out of six GCC stock markets that are more sensitive to large oil deviations than to small ones. Our results highlight the importance of economic stabilization and reform policies that can potentially reduce the sensitivity of stock returns to oil price changes, especially with regard to the existence of asymmetric behavior. |
| Keywords: | GCC stock markets, oil prices, smooth transition regression models |
| JEL: | G12 F3 Q43 |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp13853&r=all |
| By: | Lee, Nathan; Stecula, Dominik (University of Pennsylvania) |
| Abstract: | While the U.S. Congress has repeatedly failed to pass national legislation to address climate change over the years, there has been much more progress among state and local governments. But is this progress on climate change policy at the subnational level merely a reflection of the dominance of the Democratic party in certain regions of the country, or does it reflect successful bipartisan action? In this essay, we present novel evidence from two surveys of subnational policymakers, conducted in 2015 and 2017, to demonstrate that there is widespread bipartisan agreement among Republican and Democrat policymakers at the subnational level about (1) the existence of global warming and (2) what to do about it. Specifically, a majority in both parties believe global warming is happening and support the use of renewable energy mandates—rather than cap-and-trade, carbon tax, or emissions standards—to address the problem. |
| Date: | 2020–11–02 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:znr52&r=all |
| By: | Rodolfo Sejas-Portillo; David Comerford; Mirko Moro; Till Stowasser |
| Abstract: | We study the effects of limited attention on property prices and energy efficiency (EE) investments in the housing market. Using a novel dataset, we analyse over 5 million residential property sale transactions in England and Wales, each containing information about sale price, property and location characteristics, and a mandatory energy performance certificate (EPC). The EPC includes a continuous energy cost rating (SAP rating) which is mapped into seven colour-coded rating bands (ranging from green A to red G). Applying a Regression Discontinuity Design (RDD), we document significant price discontinuities at the rating band thresholds. We estimate that - holding the underlying SAP score equal - being in a higher rating band increases the final sale price of a property between 0.8% and 2.5% ($2,000 and $6,625 based on average sale prices) depending on the threshold crossed. The presence of price discontinuities suggests that individuals are attentive to the simpler colour-coded rating band and partially inattentive to the more precise SAP rating. We present a simple model for estimating the degree of inattention and show that, for a given level of attention, rating bands reduce attention to the SAP rating by 25% on average. Importantly, the detected price discontinuities appear to influence market behaviour: Sellers whose property receives an EPC rating just below a threshold to the next-higher rating band are between 0.4% and 11% more likely to make last-minute EE investments before placing their property on the market. We discuss a number of recommendations of how to best leverage these threshold effects to improve policy design, which can be extended to other settings where the provision of simplified information creates reference thresholds. |
| Keywords: | limited attention, heuristic decision-making, price discontinuities, housing market, anchoring and adjustment, energy policy, energy efficiency, energy performance certificates, EPC |
| JEL: | D12 D83 L15 R21 R31 Q48 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8669&r=all |
| By: | Wieger Hinderks; Ralf Korn; Andreas Wagner |
| Abstract: | In this paper we introduce a new concept for modelling electricity prices through the introduction of an unobservable intrinsic electricity price $p(\tau)$. We use it to connect the classical theory of storage with the concept of a risk premium. We derive prices for all common contracts such as the intraday spot price, the day-ahead spot price, and futures prices. Finally, we propose an explicit model from the class of structural models and conduct an empirical analysis, where we find an overall negative risk premium. |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2011.03987&r=all |
| By: | Bühl, Vitus; Schmidt, Robert C. |
| Abstract: | In the presence of a tipping point for dangerous climate damages, the cooperation problem of climate protection can be transformed into a coordination problem that is much easier to deal with (Barrett, 2013). This holds in particular if the amount of greenhouse gas emissions that triggers the catastrophe is precisely known, while the well-known free-rider problem re-appears if the location of the threshold is sufficiently uncertain. In this paper, we focus on the question how the non-signatories (outsiders of a climate agreement) coordinate to avoid the catastrophe, if the tipping point is known. In particular, in light of a multiplicity of equilibria in this coordination problem, the assumption that outsiders will always successfully coordinate to avoid the threshold, even if this is in their collective interest, seems overly optimistic. We analyze how the probability that the outsiders coordinate on an equilibrium in which the threshold is avoided, affects the incentives of countries to join the climate coalition. In some cases, there are multiple equilibria at the participation stage: an equilibrium with full participation, and an equilibrium in which a much smaller coalition forms - just large enough to achieve an outcome in which the catastrophe is avoided with positive probability. |
| Keywords: | tipping point,climate catastrophe,coordination game,international environmental agreement,climate cooperation |
| JEL: | D62 F53 Q54 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224649&r=all |
| By: | Birg, Laura; Voßwinkel, Jan |
| Abstract: | This paper studies the interaction of environmental policy and green preferences under potential firm relocation. A green firm and a brown firm choose the environ- mental quality of their products. Both an emission tax and consumers'willingness to pay for green products encourage investment in environmental quality. Firms may relocate to avoid taxation or abstain from investment in environmental quality to produce at lower cost. If the green firm does not relocate, both the green firm and the brown firm provide higher quality levels. Compared to first-best taxation, the equilibrium emission tax is lower (higher) if only the brown (green) firm relocates. |
| Keywords: | environmental policy,emission tax,green consumers,relocation |
| JEL: | H23 F18 L13 Q58 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224639&r=all |
| By: | Groh, Elke D.; Ziegler, Andreas |
| Abstract: | As long as electricity is generated from fossil fuels, the reduction of its consumption is an important direction for climate protection and related policy measures. Based on data of more than 3700 respondents in Germany, we thus empirically examine the relevance of a large set of well-known determinants of electricity consumption such as household and dwelling char-acteristics, but also of individual values and norms. Since behavioral economics highlights the importance of economic preferences in such public good contexts, we additionally consider risk and time preferences, trust, altruism, and reciprocity in our econometric analysis. With respect to the latter group of factors, however, only time preferences have a strong significant effect on electricity consumption. Furthermore, norms also play only a minor role. In contrast, our estimation results suggest a high relevance of dwelling characteristics and socio-demographics. Interestingly, it seems that a low electricity consumption is no important cli-mate protection activity of German inhabitants with strong environmental values, which is in contrast to the demand of such citizens for green electricity. |
| Keywords: | electricity consumption,economic preferences,individual values,social norms,econometric analysis |
| JEL: | Q41 Q54 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224587&r=all |
| By: | Gunner, S.M.; Moll, J.W. |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cantrf:305857&r=all |
| By: | Baschieri, Davide; Magni, Carlo Alberto; Marchioni, Andrea |
| Abstract: | The adoption of a photovoltaic system has positive environmental effects, but the main driver of the choice in the industrial and commercial sector is economic profitability. Switching from acquisition of energy to production of energy is an investment with costs (e.g. leasing annual payment, O&M costs, capital expenditure) and benefits (e.g. savings in the electric bill, sale of the energy exceeding consumptions). In this work, we use an accounting-and-finance model to calculate the Equity Net Present Value in different scenarios and a sensitivity-analysis method (Finite Change Sensitivity Index) to explain the reasons for differences in results. This technique enables identifying the contribution of any input factor in the output value variation. In this way, the investor can draw attention on the most significant critical variables in the initial estimations to ensure success in forecasting. |
| Keywords: | photovoltaic, economic analysis, financial modelling, financing, estimation, decision |
| JEL: | C60 C63 C67 G00 G30 G31 G32 G35 M41 O13 |
| Date: | 2020–09–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:103886&r=all |
| By: | Karine Constant (ERUDITE - Equipe de Recherche sur l’Utilisation des Données Individuelles en lien avec la Théorie Economique - UPEC UP12 - Université Paris-Est Créteil Val-de-Marne - Paris 12 - UNIV GUSTAVE EIFFEL - Université Gustave Eiffel); Marion Davin (CEE-M - Centre d'Economie de l'Environnement - Montpellier - FRE2010 - UM - Université de Montpellier - CNRS - Centre National de la Recherche Scientifique - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Institut Agro - Institut national d'enseignement supérieur pour l'agriculture, l'alimentation et l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement) |
| Abstract: | This article examines how pollution and its health effects during childhood can affect the dynamics of inequalities among households. In a model in which children's health is endogenously determined by pollution and the health investments of parents, we show that the economy may exhibit inequality in the long run and be stuck in an inequality trap with steadily increasing disparities, because of pollution. We investigate if an environmental policy, consisting in taxing the polluting production to fund pollution abatement, can address this issue. We find that it can decrease inequality in the long run and enable to escape from the trap if the emission intensity is not too high and if initial disparities are not too wide. Otherwise, we reveal that a policy mix with an additional subsidy to health expenditure may be a better option, at least if parental investment on children's health is sufficiently efficient. |
| Keywords: | Pollution,Health,Human capital,Childhood,Overlapping generations,Inequality. |
| Date: | 2020–11–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-02990775&r=all |
| By: | Kanaroglou, Pavlos S.; Anderson, William P.; South, Robert |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cantrf:306079&r=all |
| By: | Taruttis, Lisa; Weber, Christoph |
| Abstract: | The German government aims at a climate-neutral building stock by 2050 to reach the goals defined in the Climate Action Plan 2050. Increasing the energy efficiency of existing buildings is therefore a high priority. For this purpose, investments of private homeowners will play a major role since about 46.5% of the German dwellings are owner-occupied. To identify potential monetary benefits of investing in energetic retrofits, we investigate whether energy efficiency is reflected in property values of single-family houses in Germany. Thereby we examine possible heterogeneous effects among regions. With 455,413 individual observations on a 1km²-grid level for 2014 to 2018, this study adds to the literature 1) by examining the effect of energy efficiency on housing values for Germany on a more small-scale level and specifically investigating regional disparities in this context and 2) by estimating an energy efficiency value-to-cost ratio. Applying a hedonic analysis, we find a positive relationship between energy efficiency and asking prices. We also find evidence for regional disparities. Effects are significantly weaker in large cities compared to other urban areas, whereas the impact in rural areas is much stronger. Since property values are expected to decline in rural regions, homeowners could alleviate this development by increasing the energy efficiency of their dwellings. |
| Keywords: | Energy efficiency,residential buildings,regional disparities,German housing market,hedonic analysis,housing value |
| JEL: | C31 Q40 R21 R31 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224582&r=all |
| By: | Versailles, C. Alfred; Tait, L.C. |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ctrf17:305875&r=all |
| By: | Edith Ginglinger (DRM - Dauphine Recherches en Management - Université Paris Dauphine-PSL - PSL - Université Paris sciences et lettres - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Climate risks, whether physical risks or transition risks, represent an increasingly important issue for companies, bankers and institutional investors. This article provides a review of the recent literature on the relationship between climate risks and finance. It examines institutional investors' perceptions of climate risks and reports findings on the impact of climate risks on the value of real estate, debt and equity. |
| Keywords: | climate finance,climate risk,climate change,natural disasters,environmental policy,ESG,institutional investors 2 |
| Date: | 2020–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-02975207&r=all |
| By: | Whelan, Mary S. |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ctrf17:305850&r=all |
| By: | Jana Rudolf Mesaric (Ministry of Finance, State aid monitoring department, Slovenia, Ljubljana); Isabelle Seigneur (European Commission - JRC); Fernando Merida-Martin (European Commission - JRC) |
| Abstract: | The EU Member States and regions are currently investing in sustainable and innovative energy projects using European Structural and Investment Funds in order to meet their energy security and environmental targets. This support granted by Member States may distort competition and affect trade between Member States which may trigger the application of State aid rules. However, despite the general prohibition of State aid, environmental protection and clean energy measures are objectives of common interest that may justify the granting of State aid. Compliance with EU State aid rules has been often mentioned as an important challenge for cohesion policy experts, being one of the main sources of irregularities and corrections in the implementation of the regional cohesion policy and can, therefore, constitute a bottleneck for S3 and energy programmes' implementation in many regions. This report is part of the policy support provided by the Smart Specialisation Platform on Energy (S3PEnergy) to EU regions and Member States that have selected energy as a priority within their Smart Specialisation Strategies and wish to implement support schemes in this area. In order to guide their work, the S3PEnergy, in collaboration with the Andalusian Innovation and Development Agency and the Andalusian Energy Agency, and within the scope of the REGIO Communities of Practitioners, organised a TAIEX-REGIO Multicountry Workshop on State Aid Map in Energy Sector held on the 19th and 20th of March 2019, in Seville, Spain. The aim of the workshop was multifold: - To create a forum for a fruitful discussion on the application of State aid rules in the energy sector (e.g. energy infrastructures, renewables, smart grids, energy efficiency, sustainable buildings, etc.); - To address practical issues faced by national or regional responsible authorities about State aid compliance of their public interventions in energy - To co-construct State aid maps in energy to facilitate the application of the State aid rules by practitioners. The report is organised in three main sections. The first offers a general insight on State aid and the applicability of the State aid rules in the energy sector, and points to the existence of differences between the Cohesion Policy and Competition Policy. The second section elaborates on the work done in the workshop, such as the exchange of experiences among the practitioners in the form of presentations of specific energy projects and discussions. Special attention is given to the creation of the State aid maps as the final output of the workshop. Finally, the report concludes with a summary of the most common challenges in the State aid assessment of energy projects that were identified by the participants Possibilities for future cooperation among practitioners and provides suggestions for additional actions to be taken by the State aid practitioners, the REGIO Community of Practitioners (CoP) and the European Commission. |
| Keywords: | Smart Specialisation, Thematic Smart Specialisation Platform on Energy, Cohesion Policy, European Structural and Investment Funds, Competition Policy, EU State aid rules, State aid map, Communities of practitioners, Energy projects |
| Date: | 2020–10 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc122164&r=all |
| By: | Irwin, N.; Stewart, S.; Hayto, S. |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cantrf:305849&r=all |
| By: | Fischer, Andreas; Kube, Roland |
| Abstract: | Stets als teuer gebrandmarkt, doch 20 Jahre EEG haben einen rapiden Markthochlauf der Erneuerbaren Energien in Deutschland gefördert: Inzwischen wird die Hälfte des Stroms emissionsarm produziert. Für eine erfolgreiche Dekarbonisierung mitsamt Sektorenkopplung muss allerdings die Belastung der Strompreise insbesondere durch die EEG-Umlage deutlicher und dauerhaft reduziert werden. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwkkur:992020&r=all |
| By: | Firth, Don |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ctrf17:305848&r=all |
| By: | Rode, Johannes; Müller, Sven |
| Abstract: | We study variation of peer effects in rooftop photovoltaic adoption by households. Our investigation employs geocoded data on all potential adopters and on all grid-connected photovoltaic systems set up in Germany through 2010. We construct an individual measure of peer effects for each potential adopter. For identification, we exploit exogenous variation in two dimensions of photovoltaic system roof appropriateness of neighbors: their inclination and their orientation. Using discrete choice models with panel data, we find evidence for causal peer effects. However, the impact of one previously installed PV system on current adoption decreases over time. We also show that visible PV systems cause an increase in the odds of installing which is up to three times higher in comparison to all PV systems. At rural locations visibility may be less important, which indicates that word-of-mouth communication plays a stronger role. |
| Keywords: | Causal peer effects,installed base,discrete choice,technology adoption and diffusion,solar photovoltaic panels,visibility |
| JEL: | O33 C35 Q55 R10 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:vfsc20:224644&r=all |
| By: | Matteo Gardini; Piergiacomo Sabino; Emanuela Sasso |
| Abstract: | Using the concept of self-decomposable subordinators introduced in Gardini et al. [11], we build a new bivariate Normal Inverse Gaussian process that can capture stochastic delays. In addition, we also develop a novel path simulation scheme that relies on the mathematical connection between self-decomposable Inverse Gaussian laws and L\'evy-driven Ornstein-Uhlenbeck processes with Inverse Gaussian stationary distribution. We show that our approach provides an improvement to the existing simulation scheme detailed in Zhang and Zhang [23] because it does not rely on an acceptance-rejection method. Eventually, these results are applied to the modelling of energy markets and to the pricing of spread options using the proposed Monte Carlo scheme and Fourier techniques |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2011.04256&r=all |
| By: | Samantha Attridge; Jiajun Xu; Kevin P. Gallagher |
| Abstract: | In this paper, the authors examine the role of development finance institutions (DFIs) in piloting clean energy transitions by conducting in-depth case studies with representative multilateral development banks (MDBs) and national development banks. Their key findings include: (a) technical risk is the most compelling challenge for piloting new clean energies with huge uncertainties, and development-oriented DFIs endowed with industrial expertise can make forwardlooking pilot investments (sometimes throughout the supply chain) to demonstrate the viability of new technologies to attract private capital to follow suit; (b) policy and regulatory risks are a key hindrance in scaling up clean energies, and as public entities development banks have comparative advantages of coordinating and even shaping policy discussions with government agencies to mitigate such policy and regulatory risks; and (c) foreign exchange risk is an undeniable challenge for NDBs to attract foreign investment or for MDBs to invest renewable energy projects in developing countries especially given the fact that shadow financial markets make hedging costly, which encourages MDBs to explore local (green) bond issuances.This Research Paper is published in the framework of the International Research Initiative on Public Development Banks working groups and released for the occasion of the 14th AFD International Research Conference on Development. It is part of the pilot research program “Realizing the Potential of Public Development Banks for Achieving Sustainable Development Goals”. This program was launched, along with the International Research Initiative on Public Development Banks (PDBs), by the Institute of New Structural Economics (INSE) at Peking University, and sponsored by the Agence française de développement (AFD), Ford Foundation and International Development Finance Club (IDFC).Have a look on the key findings for a quick overview of the research resultsSee the video pitch |
| JEL: | Q |
| Date: | 2020–11–02 |
| URL: | http://d.repec.org/n?u=RePEc:avg:wpaper:en11711&r=all |
| By: | English, G.W.; Young, J.D.; Boumeester, H. |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:cantrf:305851&r=all |
| By: | Frédéric CHERBONNIER; Ulrich HEGE |
| Abstract: | We analyze optimal climate financial regulation to address the question when capital requirements should be differentiated in order to encourage climate related investments. We distinguish between two key dimensions of climate policies: carbon emissions (mitigation) and investment in climate resilience (adaptation), and consider two scenarios according to the efficient and inefficient carbon policies. We show that for financial regulators, the prospect of extreme climate shocks creates a rationale for differential capital requirements even when carbon prices are efficient. When extreme climate-related events occur, monetary and fiscal policies and financial regulators will optimally react with accommodating policies. The anticipation of such regulatory accommodation leads to distortions in private investment incentives. The optimal ex ante policy of regulators will attempt to correct for such biases. We also show that regulators should differentiate capital requirements when private agents insufficiently internalize the effects of investments in resilience. Finally, regulators should differentiate capital requirements that encourage both abatement and resilience investments when carbon policies are inefficient.This Research Paper is published in the framework of the International Research Initiative on Public Development Banks working groups and released for the occasion of the 14th AFD International Research Conference on Development. It is part of the pilot research program “Realizing the Potential of Public Development Banks for Achieving Sustainable Development Goals”. This program was launched, along with the International Research Initiative on Public Development Banks (PDBs), by the Institute of New Structural Economics (INSE) at Peking University, and sponsored by the Agence française de développement (AFD), Ford Foundation and International Development Finance Club (IDFC).Have a look on the key findings for a quick overview of the research resultsSee the video pitch |
| JEL: | Q |
| Date: | 2020–11–02 |
| URL: | http://d.repec.org/n?u=RePEc:avg:wpaper:en11709&r=all |
| By: | Greig, John A.; Di Sanza, Emile |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ctrf20:305918&r=all |
| By: | Niko Hauzenberger; Michael Pfarrhofer; Luca Rossini |
| Abstract: | In this paper we propose a time-varying parameter (TVP) vector error correction model (VECM) with heteroscedastic disturbances. We combine a set of econometric techniques for dynamic model specification in an automatic fashion. We employ continuous global-local shrinkage priors for pushing the parameter space towards sparsity. In a second step, we post-process the cointegration relationships, the autoregressive coefficients and the covariance matrix via minimizing Lasso-type loss functions to obtain truly sparse estimates. This two-step approach alleviates overfitting concerns and reduces parameter estimation uncertainty, while providing estimates for the number of cointegrating relationships that varies over time. Our proposed econometric framework is applied to modeling European electricity prices and shows gains in forecast performance against a set of established benchmark models. |
| Date: | 2020–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2011.04577&r=all |
| By: | Waters II, W.G. |
| Keywords: | Public Economics |
| Date: | 2020–10–22 |
| URL: | http://d.repec.org/n?u=RePEc:ags:ctrf17:305846&r=all |