nep-ene New Economics Papers
on Energy Economics
Issue of 2021‒02‒22
thirty-one papers chosen by
Roger Fouquet
London School of Economics

  1. Identifying key elements for adequate simplifications of investment choices - The case of wind energy expansion By Arne Pöstges; Christoph Weber
  2. List of wind power projects in Vietnam, 2021-01 By Minh Ha-Duong; Lan Nguyễn
  3. Options for zonation and grid integration of offshore wind in Vietnam By Phuong Nguyen; Dinh Nguyen Van; Hoang Anh Trinh Nguyen; Thi To Nhien Ngo; an Ha Truong; Minh Ha-Duong
  4. Paying extra for better wind nearshore By Minh Ha-Duong
  5. On the relevance of values, norms, and economic preferences for electricity consumption By Elke D. Groh; Andreas Ziegler
  6. How Effective has the Electricity Social Rate been in Reducing Energy Poverty in Spain? By Lisa Bagnoli; Salvador Bertomeu
  7. Stock Market Returns and Oil Price Shocks: A CoVaR Analysis based on Dynamic Vine Copula Models By Julia Kielmann; Hans Manner; Aleksey Min
  8. OIL PRICE EXPOSURE OF CEE FINANCIAL COMPANIES By Alexandra Horobet; Georgiana Maria Vrinceanu; Lucian Belascu
  9. The Impact of Oil Price Shocks on Turkish Sovereign Yield Curve By Oguzhan Cepni; Selcuk Gul; Muhammed Hasan Yilmaz; Brian Lucey
  11. Oil Extraction in Nigeria’s Ogoniland: the Role of Corporate Social Responsibility in Averting a Resurgence of Violence By Joseph I. Uduji; Elda N. Okolo-Obasi; Simplice A. Asongu
  12. China’s War on Pollution: Evidence from the First Five Years By Michael Greenstone; Guojun He; Shanjun Li; Eric Zou
  13. Import Ban and Clean Air:Estimating the Effect of China's Waste Import Ban on the Ozone Pollution By Jinsong Li
  14. Quantifying the Externalities of Renewable Energy Plants Using Wellbeing Data: The Case of Biogas By Christian Krekel; Julia Rechlitz; Johannes Rode; Alexander Zerrahn
  15. Assessment of a failure prediction model in the energy sector: a multicriteria discrimination approach with Promethee based classification By Silvia Angilella; Maria Rosaria Pappalardo
  16. The Economic Geography of Global Warming By Jose Luis Cruz Alvarez; Esteban Rossi-Hansberg
  17. Utility-Scale Storage: Sleeping Giant or Mirage? By KAPSARC, King Abdullah Petroleum Studies and Research Center
  18. Market-induced carbon leakage in China’s certified emission reduction projects By Huiying Ye; Qi Zhang; Xunzhang Pan; Arash Farnoosh
  20. Pro-environmental attitude and behaviours: an investigation on the role of pro-sociality By Caterina Giannetti; Pietro Guarnieri; Tommaso Luzzati
  21. Policies for low-carbon and affordable home heating: A French outlook By Louis-Gaëtan Giraudet; Cyril Bourgeois; Philippe Quirion
  22. The Social Cost of Carbon, Risk, Distribution, Market Failures: An Alternative Approach By Nicholas Stern; Joseph E. Stiglitz
  23. Causality Relationship between Energy Consumption and Economic Growth in the European Union Countries By Younes Gholizadeh
  24. The Non-operating Solar Projects: Examining the Impact of the Feed-in Tariff Amendment in Japan By Ling Chu
  25. The Green New Deal: Historical Foundations, Economic Fundamentals and Implementation Strategies By Julia M. Puaschunder
  26. Abolishing Environmental Regulation: Strategic E§ects and Welfare Implications By Espinola-Arredondo, Ana; Munoz-Garcia, Felix
  27. Ökonomie der landwirtschaftlichen Kohlenstoffspeicherung in Böden By Dominique Desbois
  28. The geopolitics of the European Green Deal By Mark Leonard; Jeremy Shapiro; Jean Pisani-Ferry; Simone Tagliapietra; Guntram B. Wolff
  29. Les "instruments de marché" dans la lutte contre le changement climatique : quel bilan après 20 ans ? By Philippe Quirion
  30. Quantifying the Impact of Economic Sanctions on International Trade in the Energy and Mining Sectors By Larch, Mario; Shikher, Serge; Syropoulos, Costas; Yotov, Yoto
  31. How giant discoveries of natural resources impact sovereign debt ratings in developing and emerging countries? By Regina Seri

  1. By: Arne Pöstges; Christoph Weber (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen (Campus Essen))
    Abstract: The analysis of future energy systems with increasing shares of renewable energy production poses various challenges to models used in the field of energy system analysis. Aggregation is one solution to reduce the computation time of large optimization problems, especially for optimization models with endogenous capacity expansion. Since the economic viability of renewable investments is not directly driven by physical and technical characteristics but rather by the corresponding revenue and cost streams, we propose a novel aggregation method. The aggregation covers both the spatial and the technological dimension of wind investment choices, i.e. the siting as well as the turbine choice. Four value components are defined, related e.g. to the total yield or the site-specific infeed profile of investment choices. A clustering approach is applied to these value components to identify groups of investment choices that can be aggregated without excessive loss of accuracy. The approach is applied in a case study for the German electricity system and the influence of the different value components on the combined technological and spatial aggregation is analyzed.
    Keywords: aggregation, clustering, value components, wind energy expansion
    JEL: C43 C61 O21
  2. By: Minh Ha-Duong (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Université Paris-Saclay - AgroParisTech - EHESS - École des hautes études en sciences sociales - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique); Lan Nguyễn
    Abstract: This dataset an historical list of wind power projects in Vietnam, updated 2021-01-21. The list contains 473 records, among which 381 refer to active projects. It includes the generation capacity, the project's location at the commune level, its stage classified on the Preliminary / Development / Implementation / Operation / Decommission scale, and wether it is onshore, nearshore or offshore. The sample is comprehensive for Implementation and Operation projects. We cover the total project investment cost for 162 records. We obtained the dataset by reviewing only public sources: national power development plan updates, provincial investment plans decisions ; the press and the professional literature. This dataset can be used for energy system research and modeling, for policy analysis at the provincial and national levels, and to better understand the market conditions. It provides an inspirational example of how fast it is possible to switch to renewable energy on a national scale. Climate change mitigation requires more stories like this one.
    Keywords: Wind power,Vietnam,Investment cost,Energy transition
    Date: 2021–02–01
  3. By: Phuong Nguyen (VIET - Vietnam Initiative for Energy Transition, TU/e University); Dinh Nguyen Van (VIET - Vietnam Initiative for Energy Transition, UCC - University College Cork); Hoang Anh Trinh Nguyen (VIET - Vietnam Initiative for Energy Transition); Thi To Nhien Ngo (VIET - Vietnam Initiative for Energy Transition); an Ha Truong (VIET - Vietnam Initiative for Energy Transition); Minh Ha-Duong (VIET - Vietnam Initiative for Energy Transition, CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique)
    Date: 2021–04–22
  4. By: Minh Ha-Duong (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Université Paris-Saclay - AgroParisTech - EHESS - École des hautes études en sciences sociales - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique)
    Abstract: Analysts often divide wind power projects into two categories: onshore and offshore. A third category recently emerged: nearshore projects, built on the intertidal flats. We observe a quasi cross-sectional sample of Vietnam's wind power projects, exhaustive regarding projects at the operating and building stages, comprising projects in the three categories. The median investment for onshore wind power projects in Vietnam is 1 680 USD/kW. It is 2 174 USD/kW for nearshore projects. We computed the relative extra investment distribution for intertidal projects compared to onshore projects in our sample. On average, a MW of generation capacity requires about 50% more investment nearshore than onshore. But variation is considerable, the interquartile range 20%-70% represents the extra cost better. It does not follow that electricity from nearshore stations costs more. Annual generation depends on the capacity factor. Projects developers are paying extra for better wind nearshore.
    Keywords: Wind power,Vietnam,Investment cost,Energy transition
    Date: 2021–02–01
  5. By: Elke D. Groh (University of Kassel); Andreas Ziegler (University of Kassel)
    Abstract: Based on data of more than 3700 citizens in Germany, this paper empirically examines the relevance of several groups of explanatory factors for electricity consumption. Besides controlling for individual housing and dwelling characteristics as well as socio-demographics, we analyze the effect of environmentally-related values and norms. Since behavioral economics reveals the importance of economic preferences for many individual activities, we additionally consider time and risk preferences, altruism, trust, and reciprocity in our econometric analysis. With respect to the latter factors, only patience has a significantly negative effect on electricity consumption. Our estimation results instead suggest a high relevance of individual housing and dwelling characteristics and socio-demographics. The most interesting result is probably that neither environmentally-related values such as ecological policy identification and environmental awareness nor environmentally-related social norms have a significant effect. In contrast to the USA and to the demand for green electricity in Germany, these estimation results suggest that citizens in Germany with strong environmental identity do not consider low electricity consumption as an important direction for environmental and climate protection.
    Keywords: Electricity consumption, values, norms, economic preferences, econometric analysis
    Date: 2021
  6. By: Lisa Bagnoli; Salvador Bertomeu
    Abstract: This paper analyzes the effectiveness of the electricity social rate, the Bono Social de Electricidad, introduced in 2009 in Spain's electricity market. It is a policy aimed at increasing the a_ordability of electricity by entailing a discount on prices for vulnerable consumers. Using data from the family budget survey from 2006 to 2017, we rely on a dfference-in-differences approach to measure its causal impact on energy poverty and to further analyze how the introduction of this measure affected the consumption behavior of households. We find that, on average, the introduction of the policy has reduced the likelihood of energy poverty of households eligible to the social rate. Nevertheless, the magnitude of the effect is quite modest as it corresponds in practice to only 59,000 households that are no longer in energy poverty as a result of the measure. We further show that, in reaction to lower effective prices, households do not increase their consumption of electricity. In other words, the increased affordability did not induce a change in the consumption behavior in terms of quantities purchased but it entirely resulted in a decrease in electricity expenditure.
    Keywords: Electricity, energy poverty, policy evaluation, social rate
    Date: 2021–02
  7. By: Julia Kielmann (Technical University of Munich, Germany); Hans Manner (University of Graz, Austria); Aleksey Min (Technical University of Munich, Germany)
    Abstract: Crude oil plays a significant role in economic developments in the world. Understanding the relationship between oil price changes and stock market returns helps to improve portfolio strategies and risk positions. Kilian (2009) proposes to decompose the oil price into three types of oil price shocks by using a structural vector autoregression (SVAR) model. This paper investigates the dynamic, non-linear dependence and risk spillover effects between BRICS stock returns and the different types of oil price shocks using an appropriate multivariate and dynamic copula model. Risk is measured using the conditional Value-at-Risk, conditioning on one or more simultaneous oil and stock market shocks. For this purpose, a D-vine based quantile regression model and the GAS copula model are combined. Our results show, inter alia, that the early stages of the Covid-19 crisis leads to increasing risk levels in the BRICS stock markets except for the Chinese one, which has recovered quickly and therefore shows no changes in the risk level.
    Keywords: Oil prices; risk management; time-varying copula; D-vine copula; CoVaR.
    JEL: C12 C32 C52 C53
    Date: 2021–01
  8. By: Alexandra Horobet (The Bucharest University of Economic Studies, Romania); Georgiana Maria Vrinceanu (The Bucharest University of Economic Studies, Romania); Lucian Belascu (“Lucian Blaga†University of Sibiu, Romania)
    Abstract: In recent years an alarming situation concerning the global financial markets is represented by the fact that Brent crude oil price and stock prices created the impression that they are strongly correlated. Besides, crude oil represents an indispensable and critical resource for the world economy and European Union member countries are net oil importers. In this general framework, the main purpose of this paper is to investigate the exposure to oil price risk of financial companies listed on stock exchanges from Central and Eastern European countries using monthly datasets covering the period between January 2011 and December 2018. The empirical analysis includes financial companies from seven economies from Central and Eastern Europe, all EU members and oil importers: Croatia, Czech Republic, Hungary, Poland, Romania, Slovakia and Slovenia. We use Brent crude oil prices, companies’ stock returns, local stock market indices, the Dow Jones Europe Financials Index and foreign exchange rates of the domestic currencies against the US dollar, as well as an index that capture the financial sector – related stress (CLIFS) in order to shed light on the idiosyncrasies of the oil price – returns relationship. The relevance of financial companies’ exposures to oil price changes is identified using the panel data methodology in a traditional OLS structure, as well as in a dynamic ARDL panel estimation that capture the longrun versus the short-run exposure of CEE financial companies to oil price risk. Our results suggest that oil price fluctuations impact the stock prices of financial companies from CEE countries, but the link between stock return and oil price risk has some specificities and is mostly observable on the long run. The oil price changes have a negative impact on companies’ stock returns, thus proving that they should be understood as a risk factor for the financial sector. At the same time, our results indirectly highlight the ubiquitous exposure of CEE economies to market risk factors and the worrying role of economy-wide risk transmitter of the financial sector.
    Keywords: Oil price, Exposure, Central and Eastern Europe, Financial sector
    JEL: F23 G15 G32
    Date: 2019–12
  9. By: Oguzhan Cepni; Selcuk Gul; Muhammed Hasan Yilmaz; Brian Lucey
    Abstract: This paper investigates the impact of oil price shocks on Turkish sovereign yield curve factors. The recent oil shock identification scheme of Ready (2018) is modified by using geopolitical oil price risk index in order to capture the changes in the risk perceptions of oil markets driven by geopolitical tensions such as terrorism, conflicts and sanctions. The modified identification scheme attributes more power to demand shocks in explaining the variation of the oil price. Furthermore, our findings demonstrate that the various oil price shocks influence the yield curve factors quite differently. A supply shock leads to a statistically significant increase in the level factor. This result shows that elevated oil prices due to supply disruptions are interpreted as a signal of surge in inflation expectations since the cost channel prevails. Moreover, unanticipated demand shocks have a positive impact on the slope factor as a result of the central bank policy response for offsetting the elevated inflation expectations. Overall, our results provide new insights to understand the driven forces of yield curve movements that are induced by various oil shocks in order to formulate appropriate policy responses.
    Keywords: Emerging markets, Local projections, Oil price, Supply and demand shocks, Yield curve factors, Geopolitical oil price risks
    JEL: E43 E44 G12 G15 Q43
    Date: 2021
  10. By: Anne Michèle Tenlep (Faculty of Economic and Management, University of Maroua, Cameroon)
    Abstract: The objective of this article is to analyze the impacts of oil rent on labor mobility and the demand for Cameroonian food products. By specifically examining the impact of oil rent on the demand for Cameroonian food products and using panel data for the period 2010-2017, we use a gravity model and use the Fixed Effect Vector Decomposition estimator (FEVD) that identifies the effect of invariant explanatory factors over time and controls the unobserved heterogeneity through fixed effects. Our main results reveal that there is a strong correlation between the mobility of workers, the demand for Cameroonian food products and the oil rent. Income inequalities, linguistic and geographical proximity and the effects of income increase determine the mobility of workers and the high demand for Cameroonian food products. The immediate consequence is that Cameroonian food products are becoming luxury goods. As a result, trade between Cameroon and other CEMAC countries reduces the surplus of the Cameroonian consumer although they are considered as a catalyst for unity and regional integration. In terms of recommendations, we propose the strengthening of the diversification of economies and bilateral exchanges through a strong intracountry trade opening as essential levers on which the States must act to improve the competitiveness and the substantial well-being of the populations.
    Keywords: Demand, economic integration, labor mobility, oil rent
    JEL: O13 P28 Q10
    Date: 2020–06
  11. By: Joseph I. Uduji (University of Nigeria, Nsukka, Nigeria); Elda N. Okolo-Obasi (University of Nigeria, Nsukka, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: This paper contributes to the literature on the role of Corporate Social Responsibility (CSR) in oil extraction communities of developing countries. It specifically examines the impact of Global Memorandum of Understanding (GMoU) interventions of multinational oil companies (MOCs) on preventing a resurgence of violence in the Ogoniland of Nigeria. One thousand, two hundred respondent households were sampled across the six kingdoms of Ogoniland. Results from the use of a combined propensity score matching (PSM) and logit model show that GMoUs of MOCs generate significant reductions on key drivers of insurgence in Ogoniland. This suggests that taking on more Cluster Development Boards (CDBs) should form the basis for CSR practice in Ogoniland with the objective of equipping young people with entrepreneurship skills, creating employment, promoting environmental clean-up, and checking the return of violent conflicts. This in turn provides the enabling environment for businesses to thrive in the Nigeria’s oil producing region.
    Keywords: Oil extraction, Resurgence of violence, Corporate social responsibility, Propensity matching score, Logit model, Nigeria’s Ogoniland
    Date: 2020–01
  12. By: Michael Greenstone; Guojun He; Shanjun Li; Eric Zou
    Abstract: The decade from 2010 to 2019 marked a significant turning point in China’s history of environmental regulation and pollution. This article describes the recent trends in air and water quality, with a focus on the five years since China declared a “war on pollution” in 2014. It summarizes the emerging literature that has taken advantage of accompanying improvements in data availability and accuracy to document sharp improvements in environmental quality, especially local air pollution, and understand their social, economic, and health consequences.
    JEL: Q50 Q53 Q56
    Date: 2021–02
  13. By: Jinsong Li (Graduate School of Economics, Kobe University)
    Abstract: This study investigates the effects of the plastic waste ban on local air quality in China. Using city-level daily ozone concentrations, we examine whether the pollution levels differ between coastal and inland cities in China after the import ban. Obtained results show that the daily ozone concentration lowered by 2.2% in coastal cities after the import ban. Additional analyses suggest that the effect is heterogeneous: the reduction is larger in later period, larger in cities with dirty baseline pollution, and smaller in cities with higher rural population density. These results are suggestive of the impact of import ban as an indirect policy instrument.
    Date: 2021–02
  14. By: Christian Krekel; Julia Rechlitz; Johannes Rode; Alexander Zerrahn
    Abstract: Although there is strong support for renewable energy plants, they are often met with local resistance. We quantify the externalities of renewable energy plants using well-being data. We focus on the example of biogas, one of the most frequently deployed technologies besides wind and solar. To this end, we combine longitudinal household data with novel panel data on more than 13, 000 installations in Germany. Identification rests on a spatial difference-in-differences design exploiting exact geographical coordinates of households, biogas installations and wind direction and intensity. We find limited evidence for negative externalities: impacts are moderate in size and spatially confined to a radius of 2, 000 metres around plants. We discuss implications for research and regional planning, in particular minimum setback distances and potential monetary compensations.
    Keywords: Renewables, Biogas, Externalities, Social Acceptance, Wellbeing, Spatial Analysis
    JEL: C23 Q42 Q51 R20
    Date: 2021
  15. By: Silvia Angilella; Maria Rosaria Pappalardo
    Abstract: This study presents the implementation of a non-parametric multiple criteria decision aiding (MCDA) model, the Multi-group Hierarchy Discrimination (M.H.DIS) model, with the Preference Ranking Organization Method for Enrichment Evaluations (PROMETHEE), on a dataset of 114 European unlisted companies operating in the energy sector. Firstly, the M.H.DIS model has been developed following a five-fold cross validation procedure to analyze whether the model explains and replicates a two-group pre-defined classification of companies in the considered sample, provided by Bureau van Dijk's Amadeus database. Since the M.H.DIS method achieves a quite limited satisfactory accuracy in predicting the considered Amadeus classification in the holdout sample, the PROMETHEE method has been performed then to provide a benchmark sorting procedure useful for comparison purposes.
    Date: 2021–02
  16. By: Jose Luis Cruz Alvarez; Esteban Rossi-Hansberg
    Abstract: Global warming is a worldwide and protracted phenomenon with heterogeneous local economic effects. In order to evaluate the aggregate and local economic consequences of higher temperatures, we propose a dynamic economic assessment model of the world economy with high spatial resolution. Our model features a number of mechanisms through which individuals can adapt to global warming, including costly trade and migration, and local technological innovations and natality rates. We quantify the model at a 1° × 1° resolution and estimate damage functions that determine the impact of temperature changes on a region’s fundamental productivity and amenities depending on local temperatures. Our baseline results show welfare losses as large as 15% in parts of Africa and Latin America but also high heterogeneity across locations, with northern regions in Siberia, Canada, and Alaska experiencing gains. Our results indicate large uncertainty about average welfare effects and point to migration and, to a lesser extent, innovation as important adaptation mechanisms. We use the model to assess the impact of carbon taxes, abatement technologies, and clean energy subsidies. Carbon taxes delay consumption of fossil fuels and help flatten the temperature curve but are much more effective when an abatement technology is forthcoming.
    JEL: F63 F64 Q51 Q54 Q56
    Date: 2021–02
  17. By: KAPSARC, King Abdullah Petroleum Studies and Research Center (King Abdullah Petroleum Studies and Research Center)
    Abstract: The Kingdom of Saudi Arabia, among other countries, has ambitious plans to install a significant amount of renewable capacity by 2040. A high share of renewable generation in the power system can, however, result in grid instabilities. Energy storage technology is one option that could address these challenges, being an enabler of increased renewable generation in the power sector.
    Keywords: Battery Storage, Eneryg Supply Chain, Renewable Energy, Smart Grid
    Date: 2020–11–26
  18. By: Huiying Ye (China University of Petroleum, IFPEN - IFP Energies nouvelles - IFPEN - IFP Energies nouvelles); Qi Zhang (China University of Petroleum); Xunzhang Pan (China University of Petroleum); Arash Farnoosh (IFP School)
    Abstract: The topic of climate change has aroused increasingly widespread concern around the world. Under the agreement at the 21st Conference of the Parties of the United Nations Framework Convention on Climate Change (UNFCCC), covened in Paris, France (Paris Agreement), which requires all Parties to undertake emission reductions, the developing countries who were once exempted from emission reduction obligations are now becoming more and more important. This study focuses on mitigation actions in China, the largest carbon emitter, as well as the largest developing country in the world. Specifically, we examine Chinese Certified Emission Reduction (CCER) projects. The objective is to compare the reduction efficiency of three types of projects: simple abatement and completely renewable energy alternative projects at the supply side and demand side projects. From market-induced carbon leakage point of view, a dual market equilibrium model was built, with results showing that the key factors affecting the leakage rates are price elasticities of both demand and supply sides and market share parameters. In most cases, renewable energy alternative projects show the least leakage rate while demand side projects show the highest. Sensitivity analysis finds that leakage rates for the three types of projects are more sensitive to price elasticity parameters than market share parameters. Moreover, factors Edec (electricity price elasticity of coal demand from coal-fired generation) and Ede (electricity price elasticity of electricity demand) affect not only the leakage rate of each project but also the comparative results between them. Although our study is based on China, the theoretical analysis is applicable in other regional voluntary emission reduction markets around the world. So, a systematic approach to comprehensively analyze the issue is summarized, based on which, we recommend two mitigation strategies to cope with the issue in offset projects in order to give managerial insights for the government. Firstly, the calculated leakage rates for different types of projects provide a new perspective to evaluate various offset projects, thus helping consider project types for priority validation. Secondly, we suggest to establish an accurate and classified discount coefficient system according to the project types to deal with the issue; the sensitivity analysis is helpful to find the most influential factors. A top-down approach to implement the strategy is proposed.
    Keywords: Market-induced carbon leakage,Certified emission reduction projects,Reduction efficiency,Comparison
    Date: 2020–08
  19. By: Wang-Laouna Benguellah (Faculty of Economics and Management, University of Maroua, Cameroon)
    Abstract: The article investigates the direct and indirect effects of foreign direct and indirect investment on sustainable development is an empirical analysis of the relationship between Foreign Direct Investment (FDI) and sustainable development in the WAEMU and ECCAS zones. It examines the impact of FDI on sustainable development in a sample of ten countries1 during the period 2000-2017. The estimation technique is based on the Generalized Method of Moments based on Dynamic Panel data. After a battery of tests (interdependence, stationarity, co-integration, endogeneity and model identification tests), the results reveal through the prism of co-integration that our main variables have three long-term relationships in the ECCAS sub-region and no longterm relationship in the WAEMU sub-region. In addition, in the WAEMU subregion, an increase of one unit of human development index (HDI) leads to a decrease of 2.41E-10% in FDI; 1.36E-05% in non-renewable energy consumption (CENREN). On the other hand, there is an increase of 0.499551% in carbon dioxide emissions (ECO2); 0.003856% in renewable energy consumption (CEREN); 2.75E-05% in Gross Domestic Product per capita (GDP per capita). In the ECCAS subregion, an increase of one HDI unit reveals a decrease of 1.15E-05% in HDPI, and there is an increase of 3.06E-12% in FDI, 0.005318% in non-renewable energy consumption (CENREN), an increase of 0.089169% in carbon dioxide emissions (ECO2); and 8.85E-05% in renewable energy consumption (CEREN). These results show, on the one hand, that the HDI does not contribute to the increase of the HDP in the ECCAS sub-region (which can be explained by the presence of corruption, lack of employment, low labour costs, political instability in the different countries of the sub-region...) and deteriorates FDI and CENREN in the WAEMU sub-region. In terms of recommendations, in order to have an HDI that can have a positive impact on the HDP, the actions to be taken must focus on improving governance at the level of both the States and the ECCAS sub-region. Diversifying energy sources. Finally, avoid the repatriation of profits to the countries of origin
    Keywords: : Sustainable development; foreign direct investment; gross domestic product, renewable energy and non-renewable energy
    JEL: F64 Q01 Q56
    Date: 2020–06
  20. By: Caterina Giannetti; Pietro Guarnieri; Tommaso Luzzati
    Abstract: The multifaceted nature of contemporary environmental degradation requires an all-round policy approach, that cannot disregard the role of people’s behaviour. To study how to promote environmentally friendly actions, this paper investigates whether pro-sociality triggers pro-environmental behaviours (PEBs). To this aim, we consider not only the direct effect that pro-sociality might have on PEBs but also the indirect effect transmitted through environmental concerns. After outlining a theoretical framework based on the literature on PEBs, we use a Eurobarometer survey to conduct a causal mediation analysis. Our results show that pro social attitudes are actually important, having also a strong indirect effect on PEBs. Furthermore, they suggest that policies promoting pro-social attitudes may be more effective than those simply promoting pro environmental attitudes.
    Keywords: IV-mediation analysis, environmental citizenship, PEBs, EU citizens
    JEL: C36 Q57 Q58
    Date: 2021–02–01
  21. By: Louis-Gaëtan Giraudet (CIRED - Centre international de recherche sur l'environnement et le développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - AgroParisTech - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, ENPC - École des Ponts ParisTech); Cyril Bourgeois (CIRED - Centre international de recherche sur l'environnement et le développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - AgroParisTech - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, ENPC - École des Ponts ParisTech, CNRS - Centre National de la Recherche Scientifique); Philippe Quirion (CIRED - Centre international de recherche sur l'environnement et le développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - AgroParisTech - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique, CNRS - Centre National de la Recherche Scientifique)
    Abstract: Energy demand for residential heating is targeted in France by a number of subsidy programmes (tax credits, zero-interest loans, reduced VAT, white certificates and the carbon tax. We assess the cost-effectiveness and distributional impacts of these policies using Res-IRF, an energy-economy model that integrates relevant economic, behavioural and technological processes. We find that, without further specification of revenue recycling, the carbon tax is the most effective, yet most regressive, policy. Subsidy programmes save energy at a cost of €0.05-0.08 per lifetime discounted kilowatt-hour, or €300-800/tCO2-eq; one euro of public money spent on subsidy programmes induces €1.0-1.4 private investment in home energy retrofits. Targeting subsidies towards low-income households, who tend to live in energy inefficient dwellings, increases leverage, thus reconciling economic efficiency and equity. The public cost of subsidies – €3 billion in 2013 – is outweighed by carbon tax proceeds from 2025 onwards, were the tax rate to grow as initially planned by the government. Meeting the long-term energy saving targets set by the government however requires adjusting subsidy programmes to better address rental housing. Lastly, an order-of-magnitude discrepancy between simulated and observed numbers of zero-interest loans points to economic and psychological barriers that require further investigation.
    Keywords: residential buildings,space heating,energy-economy modelling,energy efficiency subsidies,carbon tax,fuel poverty,White certificate obligations,Zero-interest rate loans
    Date: 2021
  22. By: Nicholas Stern; Joseph E. Stiglitz
    Abstract: Designing policy for climate change requires analyses which integrate the interrelationship between the economy and environment, including: the immense risks and impacts on distribution across and within generations; the many failures, limitations or absences of key markets; and the limitations on government, both in offsetting these failures and distributional impacts. Much of the standard economic modelling, including Integrated Assessment Models, does not embody key aspects of these essentials. We identify fundamental flaws in both the descriptive and normative methodologies commonly used to assess climate policy, showing systematic biases, with costs of climate action overestimated and benefits underestimated. We provide an alternative methodology by which the social cost of carbon may be calculated, one which embraces the essential elements we have identified.
    JEL: H0 Q0
    Date: 2021–02
  23. By: Younes Gholizadeh
    Abstract: This study presents the causality relationship between energy consumption and economic growth as a scope of Cobb Douglas production function by using Dynamic Panel Data Analysis for 28 European countries in the 1990-2014 period. The Dynamic Panel Data Analysis method proposed in this study considers the real Gross Domestic Production (GDP) as a dependent variable, while Capital, Labor, and Energy Consumption parameters are considered as independent variables. To indicate the causality relation between GDP and Capital, Labor and Energy Consumption parameters, Arellano-Bond autocorrelation test is applied by taking the first difference of the defined parameters. Furthermore, the Generalized Method of Moments (GMM) is used to validate the obtained results of the Arellano-Bond autocorrelation test. The results of this study show that the GDP has a direct relationship with all independent variables-i.e. Capital, Labor, and Energy Consumption. By a predefined value for the increase in these independent variables, each of the dependent variables demonstrates a unique amount of increase.
    Keywords: Neoclassic Economy, Cobb-Douglas Production Function, Dynamic Panel Data, Arellano-Bond GMM Method
    JEL: C22 Q20 Q43 Q47
    Date: 2020–10–12
  24. By: Ling Chu (Graduate School of Economics, Kobe University)
    Abstract: The non-operating solar power projects refers to a large gap between the operating and approved solar capacity in Japan. The country amended the feed-in tariff (FIT) law in 2017 to address this issue. This empirical study investigates the impact of the amended FIT policy on non-operating solar projects using municipality-level panel data from 2014 to 2019. We find that the amended policy improved the relationship between the approved capacity and operating capacity of solar power projects. The impacts are heterogeneous across different sizes of solar power projects: they are more substantial in largeand mega-scale solar power than in small-scale projects. To explore the determinants of non-operation, we also apply a cross-sectional analysis to identify municipal characteristics related to non-operating capacity. We find that the coefficient for the terrain slope is negative in the operating capacity model and positive in the non-operating capacity model. As a steep land surface leads to higher construction and maintenance costs, the results indicate that non-operating projects are located in municipalities with higher construction costs.
    Date: 2021–02
  25. By: Julia M. Puaschunder (The New School, USA)
    Abstract: The Green New Deal (GND) serves as market solution to implement global environmental governance as “the sum of the many ways individuals and institutions, public and private, manage their common affairs.†This paper discusses the historical foundations, underlying economic mechanisms of the GND and contemporary implementation strategies of the GND. GND spending should target social and green causes fostering concepts such as eco-commerce, environmental enterprise, environmental finance, fiscal environmentalism, green accounting, economy, jobs and trading as well as sustainable energy. The economic policies proposed comprise of fiscal and monetary means, innovation efforts and behavioral changes. Concrete recommendations are given on carbon tax, emissions trading, green bonds, absorbing CO2 and forestation, insurance policies, intergenerational conscientiousness, engaging portfolio managers, ecotax, environmental pricing reform, environmental tariffs, net metering, Pigovian tax and sustainable tourism. All these efforts are to support global environmental governance. The paper closes with a prospective outlook of changes implied to the GND due to the novel Coronavirus (COVID-19) crisis.
    Keywords: The Green New Deal, carbon tax, emissions trading, governance, green bonds, environmental costs, insurance policies, intergenerational conscientiousness
    Date: 2020–08
  26. By: Espinola-Arredondo, Ana (Washington State University); Munoz-Garcia, Felix (Washington State University)
    Abstract: This paper considers an environmental policy that may be rolled back in future periods by anew administration. We examine how this policy uncertainty reduces firms' incentives to invest in green R&D before the policy is scheduled to come into e§ect, increasing as a result polluting emissions. We then evaluate the welfare loss generated by policy uncertainty and compare it against the welfare loss due to abolishing environmental regulation. We identify industries where policy uncertainty can yield larger welfare losses than those from an unregulated externality. We also Önd under which settings Örm proÖts are larger when environmental policy is likely to remain into e§ect than rolled back.
    Keywords: Environmental policy; Rolled back regulation; Green R&D investment; Welfarelosses; Policy uncertainty
    JEL: L13 L51 Q55 Q58
    Date: 2021–01–28
  27. By: Dominique Desbois (ECO-PUB - Economie Publique - AgroParisTech - INRA - Institut National de la Recherche Agronomique)
    Abstract: The States that signed the Paris Accord in 2015 at the 21st Conference of the Parties (COP21) to the United Nations Framework Convention on Climate Change (UNFCCC) set themselves the common objective of achieving a balance in anthropogenic greenhouse gas (GHG) emissions by the second half of the 21st century. According to a net emissions flow approach adopted by several European countries, France adopted a "climate plan" in July 2017, with a "zero net emissions" (ZEN) objective for GHGs by 2050. Carbon sequestration in agricultural soils is one of the means envisaged to achieve this common mitigation objective.
    Abstract: Les États signataires de l'Accord de Paris en 2015 dans le cadre de la 21 e conférence des parties (COP21) à la Convention-cadre des Nations unies sur les changements climatiques (CCNUCC) se sont donnés comme objectif commun de parvenir à un équilibre des émissions anthropiques de gaz à effet de serre (GES) d'ici à la seconde moitié du XXI e siècle. Selon une logique en flux d'émissions nettes adoptée par plusieurs pays européens, la France s'est dotée d'un « plan climat » en juillet 2017, avec un objectif de « zéro émission nette » (ZEN) de GES à l'horizon 2050 1. La séquestration du carbone dans les sols agricoles est l'un des moyens envisagés pour atteindre cet objectif commun d'atténuation.
    Keywords: Carbon Neutrality,Carbon Pricing Economics,Carbon Sequestration,Cimate Change,Soil Management
    Date: 2021–02
  28. By: Mark Leonard; Jeremy Shapiro; Jean Pisani-Ferry; Simone Tagliapietra; Guntram B. Wolff
    Abstract: Policy Contribution co-writted by Mark Leonard and Jeremy Shapiro from ECFR. The European Green Deal is a plan to decarbonise the EU economy by 2050, revolutionise the EU’s energy system, profoundly transform the economy and inspire efforts to combat climate change. But the plan will also have profound geopolitical repercussions. The Green Deal will affect geopolitics through its impact on the EU energy balance and global markets; on oil and...
    Date: 2021–02
  29. By: Philippe Quirion (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique)
    Date: 2020
  30. By: Larch, Mario (University of Bayreuth); Shikher, Serge (United States International Trade Commission); Syropoulos, Costas (School of Economics Drexel University); Yotov, Yoto (School of Economics Drexel University)
    Abstract: Capitalizing on the latest developments in the gravity literature, we utilize two new datasets on sanctions and trade to study the impact of economic sanctions on international trade in the mining sector, which includes oil and natural gas. We demonstrate that the gravity equation is well suited to model bilateral trade in mining and find that sanctions have been effective in impeding mining trade. Our analysis reveals that complete trade sanctions have reduced bilateral mining trade by about 44 percent on average. We also document the presence of significant heterogeneity in the effects of sanctions on mining trade across mining industries and across sanction episodes/cases, depending on the sanctioning and sanctioned countries, the type of sanctions used, and the direction of trade flows. We take a close look at the impact of recent sanctions on Iran and Russia.
    Keywords: Structural Gravity; Sanctions; Mining; Oil; Trade Effects
    JEL: F13 F14 F51
    Date: 2021–01–31
  31. By: Regina Seri (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique)
    Abstract: This paper sheds light on the effects of giant discoveries of natural resources (oil, natural gas, minerals) on sovereign debt ratings in the short and long run. To do so, it employs 28 developing and emerging countries over the period 1990-2014 and applies a random-effects ordered Probit model on different sets of samples. It shows evidence of the differentiated effects (positive and negative) of giant discoveries on ratings. These differentiated effects are linked to the behavior of macroeconomic and political indicators resulting from the actions and policies taken in the aftermath of the discoveries. It also finds evidence of the learning effects of giant discoveries in countries with increasing sovereign debt ratings. What seems to matter is not only the resources but also how governments respond to the news of the discovery of those resources. Therefore, taking the right actions and policies will help countries to prevent a deterioration of their financial conditions.
    Keywords: Giant discoveries,Natural resources,Sovereign debt ratings,Developing countries,Random effect ordered response models
    Date: 2021–02–05

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