nep-ene New Economics Papers
on Energy Economics
Issue of 2021‒09‒27
forty-six papers chosen by
Roger Fouquet
London School of Economics

  1. Assessing the capacity of renewable power production for green energy system: a way forward towards zero carbon electrification By Chien, FengSheng; Ngo, Quang-Thanh; Hsu, Ching-Chi; Chau, Ka Yin; Mohsin, Muhammad
  2. How do environmental regulations affect carbon emission and energy efficiency patterns? A provincial-level analysis of Chinese energy-intensive industries By Ngo, Thanh Quang
  3. The effects of green growth, environmental-related tax, and eco-innovation towards carbon neutrality target in the US economy By Chien, Fengsheng; Ananzeh, Mohammed; Mirza, Farhan; Bakar, Abou; Vu, Hieu Minh; Ngo, Thanh Quang
  4. Renewable rebound: Empirical evidence from household electricity tariff switching By Schleich, Joachim; Schuler, Johannes; Pfaff, Matthias; Frank, Regine
  5. Vertical financial disparity, energy prices and emission reduction: Empirical insights from Pakistan By Li, Weiqing; Chien, Fengsheng; Ngo, Quang-Thanh; Nguyen, Tien-Dung; Iqbal, Sajid; Bilal, Ahmad Raza
  6. Promotion of Energy Efficiency Through an Energy Audit in the Industrial Sector in Japan: An Examination of Information Provision, Disclosure, Target Setting, Inspection, Reward, and Organizational Structures. By Naonari Yajima; Toshi H. Arimura
  7. Comparative Analysis of Market Efficiency and Volatility of Energy Prices Before and During COVID-19 Pandemic Periods By Alaba, Oluwayemisi O.; Ojo, Oluwadare O.; Yaya, OlaOluwa S; Abu, Nurudeen; Ajobo, Saheed A.
  8. Can climate change be tackled without ditching economic growth? By Klaas Lenaerts; Simone Tagliapietra; Guntram B. Wolff
  9. Scenarios for the Development of CO2 Emissions from Households’ Own Transportation By Kaitila, Ville
  10. Prices vs. Quantities in International Pollution Regulation By Jared C. Carbone
  11. A structural analysis of the merit-order effect in the Spanish day-ahead power market By Escribano Sáez, Álvaro; Ortega, Álvaro
  12. Assessing China's Provincial Electricity Spot Market Pilot Operations: Lessons from the Guangdong Province By Liu, Y.; Jiang, Z.; Guo, B.
  13. Evaluating green innovation and performance of financial development: mediating concerns of environmental regulation By Hsu, Ching-Chi; Ngo, Quang-Thanh; Chien, FengSheng; Li, Li; Mohsin, Muhammad
  14. Testing role of green financing on climate change mitigation: Evidences from G7 and E7 countries By Wu, Xueying; Sadiq, Muhammad; Chien, Fengsheng; Ngo, Quang-Thanh; Nguyen, Anh-Tuan; Trinh, The-Truyen
  15. Governance and renewable energy consumption in sub-Saharan Africa By Simplice A. Asongu; Nicholas M. Odhiambo
  16. The Price Responsiveness of Shale Producers: Evidence From Micro Data By Knut Are Aastveit; Hilde C. Bjørnland; Thomas S. Gundersen
  17. Did Germany reach its 2020 climate targets thanks to COVID-19? By Shammugam, Shivenes; Schleich, Joachim; Schlomann, Barbara; Montrone, Lorenzo
  18. Cost-Benefit Analysis of Kaptai Dam in Rangamati District, Chittagong, Bangladesh By Mohammad Nur Nobi
  19. Utility-Scale PV-Battery versus CSP-Thermal Storage in Morocco: Storage and Cost Effect under Penetration Scenarios By Ayat-Allah Bouramdane; Alexis Tantet; Philippe Drobinski
  20. Can the characteristics of new mortgages predict borrowers’ financial stress? Insights from the 2014 oil price decline By Olga Bilyk; Ken Chow; Yang Xu
  21. Medium- and High-Tech Export and Renewable Energy Consumption: Non-Linear Evidence from the ASEAN Countries By Dinh, Cong Khai; Ngo, Quang Thanh; Nguyen, Trung Thanh
  22. Governance in mitigating the effect of oil wealth on wealth inequality: a cross-country analysis of policy thresholds By Henri Njangang; Simplice A. Asongu; Sosson Tadadjeu; Yann Nounamo; Brice Kamguia
  23. Remittances, Natural Resource Rent and Economic Growth in Sub-Saharan Africa By Ofori, Pamela Efua; Grechyna, Daryna
  24. Can Today's and Tomorrow's World Uniformly Gain from Carbon Taxation? By Laurence J. Kotlikoff; Felix Kubler; Andrey Polbin; Simon Scheidegger
  25. Energy and Environmental Markets, Industrial Organization, and Regulation By Ryan Kellogg; Mar Reguant
  26. The Mobile Phone in Governance for Environmental Sustainability in Sub-Saharan Africa By Simplice A. Asongu; Rexon T. Nting
  27. Development of an Innovation Corridor Testbed for Shared Electric Connected and Automated Transportation By Oswald, David; Hao, Peng; Williams, Nigel; Barth, Matthew
  28. Financial Development, Human Capital Development and Climate Change in East and Southern Africa By Olatunji A. Shobande; Simplice A. Asongu
  29. Population Dynamics and Environmental Quality in Africa By Stephen K. Dimnwobi; Chukwunonso Ekesiobi; Chekwube V. Madichie; Simplice A. Asongu
  30. How prices guide investment decisions under net purchasing – An empirical analysis on the impact of network tariffs on residential PV By Arnold, Fabian; Jeddi, Samir; Sitzmann, Amelie
  31. The effects of extractive industries rent on deforestation in developing countries By Harouna Kinda; Noel Thiombiano
  32. A Data-Driven Convergence Bidding Strategy Based on Reverse Engineering of Market Participants' Performance: A Case of California ISO By Ehsan Samani; Mahdi Kohansal; Hamed Mohsenian-Rad
  33. Does What Gets Measured Get Done? An Evaluation of the Impact of the Global Protocol for Community-Scale Greenhouse Gas Emission Inventories on City Climate Action By Anthony D'Agostino; Alejandra Nicte Aponte; Sam Studnitzer; Eva Ward; Anu Rangarajan
  34. State-Level Electricity Generation Efficiency: Do Restructuring and Regulatory Institutions Matter in the US? By Ajayi, V.; Weyman-Jones, T.; ;
  35. Green technologies, complementarities, and policy By Nicolò Barbieri; Alberto Marzucchi; Ugo Rizzo
  36. On Net Energy Metering X: Optimal Prosumer Decisions, Social Welfare, and Cross-subsidies By Ahmed S. Alahmed; Lang Tong
  37. Cargo Routing and Disadvantaged Communities By Jaller, Miguel; Pahwa, Anmol; Zhang, Michael
  38. Coping with a dual shock: The economic effects of COVID-19 and oil price crises on African economies * By Théophile Azomahou; Njuguna Ndung'U; Mahamady Ouedraogo
  39. Using Satellite Imagery and Machine Learning to Estimate the Livelihood Impact of Electricity Access By Nathan Ratledge; Gabriel Cadamuro; Brandon De la Cuesta; Matthieu Stigler; Marshall Burke
  40. Decarbonising India’s Transport System: Charting the Way Forward By ITF
  41. Circular City Index: An Open Data analysis to assess the urban circularity preparedness of cities to address the green transition -- A study on the Italian municipalities By Alessio Muscillo; Simona Re; Sergio Gambacorta; Giuseppe Ferrara; Nicola Tagliafierro; Emiliano Borello; Alessandro Rubino; Angelo Facchini
  42. A Systematic Review of Qualitative Studies on Residential Consumer Experience with Smart Meters and Dynamic Pricing By Penelope Buckley
  44. Methodology for Modelling Distributional Impacts of Emissions Budgets on Employment in New Zealand. By Lynn Riggs; Livvy Mitchell
  45. Review of Unsettled: What Climate Science Tells Us, What It Doesn’t, and Why It Matters (By Stephen E. Koonin) By David K Levine
  46. Climate change and monetary policy in the euro area By Drudi, Francesco; Moench, Emanuel; Holthausen, Cornelia; Weber, Pierre-François; Ferrucci, Gianluigi; Setzer, Ralph; Adao, Bernardino; Dées, Stéphane; Alogoskoufis, Spyros; Téllez, Mar Delgado; Andersson, Malin; Di Nino, Virginia; Aubrechtova, Jana; Diez-Caballero, Arturo; Avgousti, Aris; Duarte, Claudia; Barbiero, Francesca; Estrada, Ángel; Boneva, Lena; Faccia, Donata; Breitenfellner, Andreas; Faiella, Ivan; Bua, Giovanna; Farkas, Mátyás; Bun, Maurice; Ferrari, Alessandro; Caprioli, Francesco; Fornari, Fabio; Ciccarelli, Matteo; Mendoza, Alberto Fuertes; Darracq Pariès, Matthieu; Garcia-Sanchez, Pablo; Giovannini, Alessandro; Papadopoulou, Niki; Grüning, Patrick; Parker, Miles; Guarda, Paolo; Petroulakis, Filippos; Hebbink, Gerbert; Piloiu, Anamaria; Murphy, Sarah Jane Hlásková; Ploj, Gasper; Ioannidis, Michael; Pointner, Wolfgang; Isgro, Lorenzo; Popov, Alexander; Kapp, Daniel; Prammer, Doris; Kashama, Mélissa Kasongo; Queiroz, Ricardo; Lopez-Garcia, Paloma; Rachedi, Omar; Lozej, Matija; Rognone, Lavinia; Lydon, Reamonn; Röhe, Oke; Manninen, Otso; Roos, Madelaine; Manzanares, Andrés; Russo, Simone; McInerney, Niall; Santabárbara, Daniel; Meinerding, Christoph; Schotten, Guido; Mikkonen, Katri; Sotomayor, Beatriz; Mistretta, Alessandro; Stracca, Livio; Mongelli, Francesco Paolo; Tamburrini, Fabio; Montes-Galdón, Carlos; Theofilakou, Anastasia; Müller, Georg; Tsalaporta, Pinelopi; Nerlich, Carolin; van den End, Jan Willem; Osiewicz, Malgorzata; Cruz, Lia Vaz; Osorno-Torres, Boris; Weth, Mark Andreas; Ouvrard, Jean-François; Gomez, Gonzalo Yebes; Page, Adrian

  1. By: Chien, FengSheng; Ngo, Quang-Thanh; Hsu, Ching-Chi; Chau, Ka Yin; Mohsin, Muhammad
    Abstract: Ghana suffers from inadequate power supply due to increasing demand though it is amongst the African nations with the highest access to electricity. This research aims to assess the techno-economic potential of wind and solar energy potential for Ghana’s northern part. We employ the Weibull distribution function, levelized cost of energy, and net present cost metrics for the economic study. The wind and solar energy resource’s structure generated 72,284 kWh yearly. Both systems were identified to be too expensive if implemented under the current financing conditions in the country. The PV systems generated 38,859 kWh/ year, representing 53.76% of the total electricity generated in a year, generating renewable hydrogen in the country. The findings show that sizing and management of renewable plants will fulfill the basic annual cooking demands of the populations, which are 785 kg H2 in Ghana. The countries’ capacity for developing solar hydrogen plants is further suggested by generating new solar hydrogen opportunity charts. Considering the significance of hydrogen energy under the renewable energy output, we recommend using hybrid systems for hydrogen production. The findings reveal which flexibility options are critical in key stages of the energy transition to a 70, 80, 90, and 100% renewable energy system.
    Keywords: Solar energy; Techno-economic analysis; Ghana, HOMER; LCOE; Hybrid power plant
    JEL: E0
    Date: 2021–07–29
  2. By: Ngo, Thanh Quang
    Abstract: This study measures the environmental regulation effect and pattern of carbon emission and energy efficiency through data envelopment analysis and econometric estimation. One of the most important ways to achieve a green transition is promoting technical progress through environmental regulation. Though China has witnessed rapid economic growth over the last two decades, the country can improve it further through adopting sustainable green energy and establishing more energy-efficient industries to strike a good balance between economic and social developments. The oil and carbon dioxide emission performances form the most important metrics. This study uses panel data from 30 Chinese provinces from 2008 to 2017 to assess the effect of environmental regulation on energy production. The nonradial directional distance function (NDDF) is used to measure the total factor energy efficiency index (TFEEI). The panel system GMM model, which can effectively address endogenous problems and regional variability, is utilized to research the nonlinear relationship between environmental regulations and EEI under various environmental regulations to study it. The findings reveal a considerably modest total average EEI amount for energy-intensive industries, averaging between 0.55 and 0.58, which is way below the ideal value (i.e., 1). Furthermore, the results of the dynamic panel data model revealed a significant U-shaped relationship between China’s EEI and environmental regulation. The results show that as the values of market-based environmental regulations (MERs) and command and control environmental regulations (CCERs) exceed the corresponding levels, the impact of environmental regulation on the TFEEI increases gradually. This study will aid policymakers in better understanding the efficacy of different levels of environmental regulations to make more educated decisions.
    Keywords: Total factor energy efficiency; High energy-intensive industries; Environmental regulation; Nonradial directional distance function
    JEL: E0
    Date: 2021–08–02
  3. By: Chien, Fengsheng; Ananzeh, Mohammed; Mirza, Farhan; Bakar, Abou; Vu, Hieu Minh; Ngo, Thanh Quang
    Abstract: This study aims to examine the nexus between green growth and carbon neutrality targets in the context of the USA while observing the role of ecological innovation, environmental taxes, and green energy. For this purpose, data were collected from 1970 to 2015 for all the variables of interest. This research utilized the quantile autoregressive distributed lag (QARDL) method due to its various benefits, such as depicting the causality patterns based on different quantiles for different variables like green growth, ecological innovation, environmental taxes, and renewable energy. The findings through the QARDL method showed that the error correction coefficient was significant and negative with the expected negative sign for the different quantiles. The findings showed a significant and negative impact of green growth, square of green growth, ecological innovation, and environmental taxes in determining the carbon dioxide (CO2) emissions for the USA’s economy under the long-run estimation. Meanwhile, the outcome for the short-term estimation confirmed that the past and lagged values of CO2 emission were significantly and negatively linked with the current and lagged values of CO2 emission. On the other hand, it was found that green growth and square of green growth, ecological innovation, environmental taxes, and renewable energy played their vital role in reducing haze pollution like PM2.5. Besides, this research also covers the limitations and policy implications.
    Keywords: CO2 emission; Ecological innovation; Environmental pollution; Green growth; USA
    JEL: E0
    Date: 2021–08–24
  4. By: Schleich, Joachim; Schuler, Johannes; Pfaff, Matthias; Frank, Regine
    Abstract: Potential environmental benefits of green tariffs may be mitigated if households increase electricity consumption after they subscribe to green tariffs. Using metered data of household electricity consumption from a large provider of green electricity in Germany, our quasi-experimental analysis finds that household switching to a green tariff leads to a non-monetary renewable rebound effect of around 8.5 %. Further, our findings imply that this renewable rebound effect is persistent over at least four years. These findings may be explained by moral licensing effects which induce households to permanently change their habitual behaviours and/or to acquire additional electricity-consuming technologies. Thus, failure to account for a renewable rebound in policy evaluation may lead to systematically underestimate the costs of achieving energy and climate targets.
    Keywords: rebound,renewable rebound,green tariffs,moral licensing
    Date: 2021
  5. By: Li, Weiqing; Chien, Fengsheng; Ngo, Quang-Thanh; Nguyen, Tien-Dung; Iqbal, Sajid; Bilal, Ahmad Raza
    Abstract: The economic and environmental aspects of energy production have become important due to the increasing complexity energy sector and environmental pollution, warranting to test the connection between financial imbalances, energy prices and carbon emission. The study aims to test the impact of vertical fiscal imbalances (VFI) on energy prices and carbon emission trends by considering the dual-perspectives of environmental regulation and industrial structure. The empirical outcomes indicated that vertical fiscal imbalances limited the environmental quality of Pakistan. Furthermore, VFI also caused environmental degradation by affecting industrial structure. VFI inhibits the intensity of environmental regulation, promotes the upgrade of industrial structures, both of which cause additional carbon emissions. The study suggest to energy ministries and energy regulation offices to revisit the mechanism of energy prices determination and revised mechanism should provide a user-friendly assessment to understand the actual costs associated with the rising concern of environmental pollution. By this, environmental protection maximization and optimal energy conservation is expected to increase. Based on empirical findings, the study extends the suggestion that vertical fiscal imbalances should be considered an active indicator by the key policy makers and other stakeholders for energy prices determination and environmental quality upgradation.
    Keywords: Vertical financial disparity; Energy prices; Carbon emissions; Environmental regulation; Industrial structure
    JEL: E0
    Date: 2021–06–18
  6. By: Naonari Yajima (: Faculty of Political Science and Economics, Waseda University, 1-6-1 Nishiwaseda, Shinjuku-ku, Tokyo, 169-8050, Japan., Graduate School of Economics, Waseda University, 1-6-1 Nishiwaseda, Shinjuku-ku, Tokyo, 169-8050, Japan); Toshi H. Arimura (Faculty of Political Science and Economics, Waseda University, 1-6-1 Nishiwaseda, Shinjuku-ku, Tokyo, 169-8050, Japan., : Research Institute for Environmental Economics and Management, Waseda University, 1-6-1 Nishiwaseda, Shinjuku-ku, Tokyo, 169-8050, Japan.)
    Abstract: An energy audit is a famous policy instrument to improve the energy efficiency in facilities. Although energy audits have been adopted by many countries, it is unclear whether energy audits can improve the energy efficiency, since there are several barriers to energy efficiency under energy audits. For example, the facility does not need to evaluate the net benefit of energy efficiency is greater than its cost. Another possible barrier to energy efficiency is that an energy manager may have less information to improve their energy efficiency. Moreover, even if managers can find methods to improve their energy efficiency, organizational structures may be a barrier to adopting these methods. Therefore, additional practices such as information provision, target setting, or reward by governments can make an energy audit more effective. This paper investigates the complementarity of an energy audit and these practices by focusing on the Emission Reduction Program (ERP), which is a unique energy audit in Japan. Using municipality-level data, we show that target setting, inspection, and designating the department/division responsible for tackling climate change can complementarily promote the reduction in greenhouse gas emissions by facilities under the ERP
    Keywords: Energy audit, Greenhouse gas emissions reduction, Emissions Reduction Program, Municipality-level data
    Date: 2021–06
  7. By: Alaba, Oluwayemisi O.; Ojo, Oluwadare O.; Yaya, OlaOluwa S; Abu, Nurudeen; Ajobo, Saheed A.
    Abstract: The Covid-19 pandemic has affected energy demand and pricing globally due to different lockdown measures embarked on by governments in different economies. As a result, prices of oil and petroleum products dropped drastically at the peak of the pandemic period. The present paper, therefore, investigates the effect of the pandemic on energy markets and compared the levels of market efficiency, volatility, and volatility persistence. Two 5-monthly daily data windows are considered, each for the period before and during the pandemic, and an updated nonlinear fractional integration approach in time series analysis is employed. Having considered prices of Crude oil, Gasoline, Diesel, Heating oil, Kerosene, and Propane from US markets, we find that energy markets are less efficient during the Covid-19 pandemic period, even though with higher volatility but with lesser volatility persistence compared to the period before the pandemic. Thus, volatility shocks last for a shorter period during the 5-month pandemic period than in the 5-month period that precedes the pandemic. It is hoped that the findings of this work will be of interest to oil marketers and administrators in the international oil markets.
    Keywords: Energy price; Covid-19 pandemic; Efficient market; Volatility persistence; Fractional integration
    JEL: C22 Q41 Q48
    Date: 2021–09–21
  8. By: Klaas Lenaerts; Simone Tagliapietra; Guntram B. Wolff
    Abstract: Higher levels of economic activity tend to go hand-in-hand with additional energy use and consumption of natural resources. As fossil fuels still account for 80 percent of the global energy mix, energy consumption remains closely related to greenhouse gas emissions and hence to climate forcing. This paper explores whether decarbonisation and economic growth are compatible or whether the world economy needs to grow less to be able to reduce greenhouse...
    Date: 2021–09
  9. By: Kaitila, Ville
    Abstract: Abstract We assess the development of greenhouse gas emissions from households’ own transport, mainly motoring, up until 2050. The share of electric cars in new registrations has recently started to increase markedly, so the outlook in this respect has clearly changed from a couple of years ago. We make three scenarios for the development of the average emissions of newly registered passenger cars, use historical development in setting the future scrapping rate and average age of the car fleet, and take into account the increase in the obligation to mix biofuels in the 2020s. According to the scenarios, the development of greenhouse gas emissions caused by households’ own transport will support the achievement of Finland’s national carbon neutrality target relatively well providing current development continues. In the baseline scenario, emissions will decrease by a total of 45 per cent between 2008 and 2030. The rate of decline is accelerating all the time as the emissions of newly registered cars decrease and the old car fleet with clearly higher emissions is scrapped. However, the development should be supported by ensuring adequate construction of households’ own and public electric-vehicle-charging infrastructure. In addition, household choices could be influenced, for example, by steepening the CO2 progression of car and vehicle taxes, which would increase household incentives to switch to lower-emission cars. At a minimum, at least inflation adjustments must also be made in the taxation of car ownership and use.
    Keywords: CO2 emissions, Passenger cars, Transportation
    JEL: D12 Q54
    Date: 2021–09–15
  10. By: Jared C. Carbone (Colorado School of Mines)
    Abstract: In simple models of pollution regulation, both emission taxes and systems of tradable emission permits are minimum-cost methods of achieving a target level of pollution reduction. In this paper, I identify a source of asymmetry between permits and taxes based on the expectation a nation holds for the effect of its policy on interntational prices and pollution levels. Taxes allow for flexibility in the quantity of pollution produced and permits do not. In the context of international pollution policy, this means that a country may reasonably anticipate no foreign emission response to domestic abatement changes when the world’s abatement programs are denominated in terms of permits because permits cap aggregate pollution levels. The same is not true in tax-based regimes. Thus, tax or permit-based plans with the same regulatory goals will result in different equilibrium emission reductions, a different cost-benefit balance, and a different regional distribution of welfare impacts. The analysis provides an analytical description of the incentives faced by countries in each of these regimes and a numerical characterization of equilibrium outcomes for greenhouse gas emissions in a calibrated, general equilibrium model.
    Keywords: climate change, general equilibrium, tradable permits, carbon tax
    JEL: D58 F18 F42 Q52 Q54
    Date: 2021–09
  11. By: Escribano Sáez, Álvaro; Ortega, Álvaro
    Abstract: Renewable generation has increased exceptionally its weight in power markets, and its relevance is due to increase with the introduction of recent climate policies in Europe. The merit-order effect ranks first on the direct impacts of renewables on electricity markets. However, in order to analyse its impact, it is important to control for the different forces driving electricity prices. As a result, the analysis through a structural model of demand and supply of electricity is interesting to capture price drivers and therefore measure correctly the merit-order effect. The objective of this paper is tointroduce this framework on the Spanish day-ahead market, using weekly data for the period 2013-2019. The empirical analysis is carried out using structural vector autoregressive models (SVAR) and autoregressive distributed lag models (ARDL) to each equation, with the addition of GARCH models to control for the possible autoregressive volatility behaviour of the residuals. In line with previous literature, we obtain that demand of electricity is elastic to economic growth, price-inelastic and shows a significant level of substitution between electricity and natural gas. The supply function is also price-inelastic, after controlling for capacity factors, inputs prices and external balance, that are shown to be significant. The estimated values of the merit-order effect is aligned with previous literature. We obtain that a 10% increase in the average quantity generated by the special regime technologies (wind, solar and CHP) is associated with a 5 % reduction in electricity prices, around 2.35Euros/MWh of the average price for the analysed period.
    Keywords: Demand of Electricity; Supply of Electricity; Merit-Order; Renewable Generation; Capacity Factor; Day-Ahead Power Market
    JEL: L94 L51 L52 L13
    Date: 2021–09–21
  12. By: Liu, Y.; Jiang, Z.; Guo, B.
    Abstract: Targeting on improving the efficiency of power generation, China announced its plan to reform the electricity wholesale market. A focal point of the wholesale market reform is to introduce a stable and reliable electricity spot market. Using Guangdong's spot market pilot operations as a case study, this article becomes the first which uses ex-post market data to assess the efficacy of China's electricity spot market. To investigate the stability of the spot market, we estimate the relationship between prices and demand. We find the electricity supply curve to be non-linear and convex, suggesting the needs to invest more thermal capacity to stabilise the spot market prices (SMPs). To investigate the reliability of the spot market, we first estimate the market distortion caused by a price floor on the SMPs, and then examine whether local market power exists. The price floor on the SMPs resulted in a welfare transfer from consumers to producers, the monetary value of which equals to 1.3% of the tradable value of the day-ahead market. We also find evidence of local market power in the east of Guangdong, suggesting the necessity of investing more power lines connecting the west to the east. Finally, policy implications are provided.
    Keywords: China power market reform, market failures, local market power, electricity spot market
    JEL: Q41 Q48 D61
    Date: 2021–09–17
  13. By: Hsu, Ching-Chi; Ngo, Quang-Thanh; Chien, FengSheng; Li, Li; Mohsin, Muhammad
    Abstract: This research measures the relationship between green innovation and the performance of financial development by using an econometric estimation during the year of 2000 to 2018 in 28 Chinese provinces. It is intended to explore the relative role of green technological innovation in driving green financial development in the west and central China, as well as how it influences economic growth in these regions. Ordinary least square (OLS) framework was utilized in mainland China to perform empirical studies by using an econometric estimation. This study claims that China has adopted research-based education system, while those for economic growth and expenditure in the regions while the innovation parts results shows that the tertiary education were 12.42% and 13.53% versus the 10.50% and 10.6% in the eastern area. The research-based education increases the patents in green innovation and boosts the environmental policy. The financial development led to green technological development and innovation. Green innovation and financial development decrease the emissions, and it is apparent that as environmental regulations stimulate technical development, the superiority of human resources increases. The findings indicate that green financing reduces short-term lending, thus limiting clean energy overinvestment, while the long-term loans have little impact on renewable energy overinvestment, and the intermediary effect is unmaintainable. Meanwhile, the green financial growth will reduce renewable energy overinvestment and increase renewable energy investment productivity to certain amount.
    Keywords: Financial development; Environmental regulation; Green economic performance; GMM; Econometric estimation
    JEL: E0
    Date: 2021–06–05
  14. By: Wu, Xueying; Sadiq, Muhammad; Chien, Fengsheng; Ngo, Quang-Thanh; Nguyen, Anh-Tuan; Trinh, The-Truyen
    Abstract: The study estimates the long-run dynamics of a cleaner environment in promoting the gross domestic product of E7 and G7 countries. The recent study intends to estimate the climate change mitigation factor for a cleaner environment with the GDP of E7 countries and G7 countries from 2010 to 2018. For long-run estimation, second-generation panel data techniques including augmented Dickey-Fuller (ADF), Phillip-Peron technique and fully modified ordinary least square (FMOLS) techniques are applied to draw the long-run inference. The results of the study are robust with VECM technique. The outcomes of the study revealed that climate change mitigation indicators significantly affect the GDP of G7 countries than that of E7 countries. The GDP of both E7 and G7 countries is found depleting due to less clean environment. However, green financing techniques helps to clean the environment and reinforce the confidence of policymakers on the elevation of green economic growth in G7 and E7 countries. Furthermore, study results shown that a 1% rise in green financing index improves the environmental quality by 0.375% in G7 countries, while it purifies 0.3920% environment in E7 countries. There is a need to reduce environmental pollution, shift energy generation sources towards alternative, innovative and green sources. The study also provides different policy implications for the stakeholders guiding to actively promote financial hedging for green financing. So that climate change and environmental pollution reduction could be achieved effectively. The novelty of the study lies in study framework.
    Keywords: Cleaner environment; Green financing; Climate change; E7 countries; G7 countries
    JEL: E0
    Date: 2021–07–08
  15. By: Simplice A. Asongu (Yaounde, Cameroon); Nicholas M. Odhiambo (Pretoria, South Africa)
    Abstract: The purpose of this study is to assess the nexus between governance and renewable energy consumption in sub-Saharan Africa. The focus is on 44 countries in Sub-Saharan Africa with data from 1996 to 2016. The empirical evidence is based on Tobit regressions. It is apparent from the findings that political and institutional governance are negatively related to the consumption of renewable energy in the sampled countries. The unexpected findings are clarified and policy implications are discussed in the light of sustainable development goals. This study extends the extant literature by assessing how political governance (consisting of political stability and “voice & accountability†) and institutional governance (entailing the rule of law and corruption-control) affect the consumption of renewable energy in sub-Saharan Africa.
    Keywords: Renewable energy; Governance; Sub-Saharan Africa; Sustainable development
    JEL: H10 Q20 Q30 O11 O55
    Date: 2021–01
  16. By: Knut Are Aastveit; Hilde C. Bjørnland; Thomas S. Gundersen
    Abstract: Shale oil producers respond positively and significantly to favourable oil price signals. This finding is established using a novel proprietary data set consisting of more than 200,000 shale wells across ten U.S. states spanning almost two decades. We document large heterogeneity in the estimated responses across the various shale wells, suggesting that aggregation bias is an important issue for this kind of analysis. We find responses to be stronger for the largest oil producing firms, among wells that are spaced further apart and in regions where the density of shale wells is higher. The response also depend on the level of production. Our empirical results calls for new models that can account for a growing share of shale oil in the U.S., the inherent flexibility of shale extraction technology in production and the role of shale oil in transmitting oil price shocks to the U.S. economy.
    Keywords: Oil price, Shale oil supply, Well-level panel data
    Date: 2021–09
  17. By: Shammugam, Shivenes; Schleich, Joachim; Schlomann, Barbara; Montrone, Lorenzo
    Abstract: In this paper, we estimate the effects of COVID-19 on greenhouse gas emissions (GHG) in Germany in 2020 at the sectoral and national level. Counterfactual emissions are estimated based on autoregressive econometric models and distinguish between different factors of emissions based on decomposition analysis. Our findings at the national level suggest that COVID-19 lowered GHG emissions in 2020 in Germany by about 45 Mt CO2-eq (6.1%). Accordingly, about two-thirds of the reduction in emissions between 2019 and 2020 in Germany may be attributed to COVID-19. Our findings at the sectoral level imply that all sectors, with the exception of the transport sector, would have met their emissions target in 2020 without COVID-19. Thus, for the buildings sector and the transport sector, our results suggest policy responses that differ from those pursued by the German government to comply with the provisions of the Federal Climate Change Act.
    Keywords: COVID-19,climate targets,climate policy,greenhouse gas emissions
    Date: 2021
  18. By: Mohammad Nur Nobi
    Abstract: This study aims to assess the net benefit of the kaptai dam on the Karnafuli river in Kaptai, Chittagong, Bangladesh. Kaptai Dam, the only hydroelectricity power source in Bangladesh, provides only 5% electricity demand of Bangladesh. The Dam is located on the Karnafuli River at Kaptai in Rangamati District, 65 km upstream from Chittagong. It is an earth-fill or embankment dam with a reservoir with a water storage capacity of 11,000 skm. Though the Dam's primary purpose is to generate electricity, it became a reservoir of water used for fishing and tourism. To find the net benefit value and estimate the environmental costs and benefits, we considered the environmental net benefit from 1962 to 1997. We identify the costs of Kaptai Dam, including its establishment cost, operational costs, the costs of lives that have been lost due to conflicts, and environmental costs, including loss of biodiversity, loss of land uses, and loss of human displacements. Also, we assess the benefits of electricity production, earnings from fisheries production, and gain from tourism to Kaptai Lake. The findings show that the Dam contributes tremendous value to Bangladesh. As a source of hydroelectricity, the Kaptai Dam is a source of clean energy, and its value might have been worthy of this Dam produced a significant portion of the electricity. However, providing less than 5% of the national demand for electricity followed by various external and sensitive costs, the Dam hardly contributes to the Bangladesh economy. This study thus recommends that Bangladesh should look for other sources of clean energy that have no chances of eco-political conflicts.
    Date: 2021–09
  19. By: Ayat-Allah Bouramdane (LMD - Laboratoire de Météorologie Dynamique (UMR 8539) - INSU - CNRS - Institut national des sciences de l'Univers - X - École polytechnique - ENPC - École des Ponts ParisTech - SU - Sorbonne Université - CNRS - Centre National de la Recherche Scientifique - Département des Géosciences - ENS Paris - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres); Alexis Tantet (LMD - Laboratoire de Météorologie Dynamique (UMR 8539) - INSU - CNRS - Institut national des sciences de l'Univers - X - École polytechnique - ENPC - École des Ponts ParisTech - SU - Sorbonne Université - CNRS - Centre National de la Recherche Scientifique - Département des Géosciences - ENS Paris - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres); Philippe Drobinski (LMD - Laboratoire de Météorologie Dynamique (UMR 8539) - INSU - CNRS - Institut national des sciences de l'Univers - X - École polytechnique - ENPC - École des Ponts ParisTech - SU - Sorbonne Université - CNRS - Centre National de la Recherche Scientifique - Département des Géosciences - ENS Paris - ENS Paris - École normale supérieure - Paris - PSL - Université Paris sciences et lettres)
    Abstract: In this study, we examine how Battery Storage (BES) and Thermal Storage (TES) combined with solar Photovoltaic (PV) and Concentrated Solar Power (CSP) technologies with an increased storage duration and rental cost together with diversification would influence the Moroccan mix and to what extent the variability (i.e., adequacy risk) can be reduced; this is done using recent (2013) cost data and under various penetration scenarios. To do this, we use MERRA-2 climate reanalysis to simulate hourly demand and capacity factors (CFs) of wind, solar PV and CSP without and with increasing storage capabilities—as defined by the CSP Solar Multiple (SM) and PV Inverter Loading Ratio (ILR). We adjust these time series to observations for the four Moroccan electrical zones over the year 2018. Our objective is to maximize the renewable (RE) penetration and minimize the imbalances between RE production and consumption considering three optimization strategies. We analyze mixes along Pareto fronts using the Mean-Variance Portfolio approach—implemented in the E4CLIM model—in which we add a maximum-cost constraint to take into account the different rental costs of wind, PV and CSP. We propose a method to calculate the rental cost of storage and production technologies taking into account the constraints on storage associated with the increase of SM and ILR in the added PV-BES and CSP-TES modules, keeping the mean solar CFs fixed. We perform some load bands-reduction diagnostics to assess the reliability benefits provided by each RE technology. We find that, at low penetrations, the maximum-cost budget is not reached because a small capacity is needed. The higher the ILR for PV, the larger the share of PV in the mix compared to wind and CSP without storage is removed completely. Between PV-BES and CSP-TES, the latter is preferred as it has larger storage capacity and thus stronger impact in reducing the adequacy risk. As additional BES are installed, more than TES, PV-BES is favored. At high penetrations, optimal mixes are impacted by cost, the more so as CSP (resp., PV) with high SM (resp., ILR) are installed. Wind is preferably installed due to its high mean CF compared to cost, followed by either PV-BES or CSP/CSP-TES. Scenarios without or with medium storage capacity favor CSP/CSP-TES, while high storage duration scenarios are dominated by low-cost PV-BES. However, scenarios ignoring the storage cost and constraints provide more weight to PV-BES whatever the penetration level. We also show that significant reduction of RE variability can only be achieved through geographical diversification. Technological complementarity may only help to reduce the variance when PV and CSP are both installed without or with a small amount of storage. However, the diversification effect is slightly smaller when the SM and ILR are increased and the covariances are reduced as well since mixes become less diversified.
    Keywords: thermal energy storage,photovoltaic,battery energy storage,rental cost,diversification,Morocco,concentrated solar power
    Date: 2021
  20. By: Olga Bilyk; Ken Chow; Yang Xu
    Abstract: We study the relationship between characteristics of new mortgages and borrowers’ financial stress in Canada’s energy-intensive regions following the 2014 collapse in oil prices. We find that borrowers with limited home equity were more likely to have difficulty repaying debt.
    Keywords: Credit and credit aggregates; Econometric and statistical methods; Financial stability; Housing
    JEL: C25 D14 G51 R21
    Date: 2021–09
  21. By: Dinh, Cong Khai; Ngo, Quang Thanh; Nguyen, Trung Thanh
    Abstract: Sustaining economic growth while reducing dependence on fossil fuels remains a challenge for our world to fight against climate change and therefore finding a way to promote economic growth and increase renewable energy use is needed. This paper uses a 22-year panel dataset (1994– 2015) of 9 countries in the Association of Southeast Asian Nations provided by the World Bank World Development Indicators to examine the impact of medium- and high-tech export on renewable energy use. We employ a fixed-effects regression model with the Driscoll–Kraay nonparametric covariance matrix estimator to account for sectoral and temporal dependence. We also control for inflation, employment, population growth, and gross domestic product per capita in our estimations. Our results demonstrate a U-shaped association between medium- and high-tech export and renewable energy consumption of these economies. The results propose that enhancing medium- and high-tech export could be a feasible solution for promoting renewable energy consumption.
    Keywords: renewable energy; medium- and high-tech export; economic growth; employment; inflation; ASEAN
    JEL: E0
    Date: 2021–07–22
  22. By: Henri Njangang (University of Dschang? Cameroon); Simplice A. Asongu (Yaoundé, Cameroon); Sosson Tadadjeu (University of Dschang , Cameroon); Yann Nounamo (University of Douala, Douala, Cameroon); Brice Kamguia (University of Dschang, Cameroon)
    Abstract: The study assesses the role of governance in modulating the effect of oil wealth on wealth inequality in 45 countries in the world. The empirical evidence is based on Pooled Ordinary Least Squares and the Generalised Method of Moments. The findings show that oil rents unconditionally increase wealth inequality while govenance dyanmics (in terms of rule of law, corruption-control, government effectiveness, regulatory quality) moderate oil rents for an overall net negative effect on wealth inequality. Good governance thresholds at which the unconditional effect of oil rents on the wealth inequality changes from positive to negative are computed and discussed. It follows that while governance is a necessary condition for improving the redistributive effects of oil wealth, it becomes a sufficient condition for net positive improvements in wealth distribution only when some critical levels of good governance have been reached. Other policy implications are discussed.
    Keywords: Governance; Oil wealth; Wealth inequality, Panel data
    JEL: F21 F54 L71
    Date: 2021–01
  23. By: Ofori, Pamela Efua; Grechyna, Daryna
    Abstract: Despite the established link between oil rent fluctuations and remittances received, its plausible joint effect on economic growth in Sub-Saharan Africa (SSA) remains unexplored. To fill this gap, first we determine whether natural resource rent (composed of oil rent, forest rent and natural gas rent) reduces economic growth in SSA. Second, we examine whether positive macroeconomic signals such as remittances mitigate the negative effect of oil rents on economic growth in a sample of 43 SSA countries spanning 1990-2017. We employ the pooled ordinary least squares, fixed-effects and random-effects, and generalized method of moments. The resulting empirical evidence established are; (1) There is a positive impact of forest rent on economic growth whilst oil rent and natural gas rent have a negative impact on economic growth. (2) There is a positive marginal and net effect on economic growth from the interaction between remittances and oil rent. Also, the unconditional effect of remittances on growth is positive. We further perform a threshold analysis to establish a critical ground that could also influence economic growth positively. This threshold is crucial because above these critical mass remittance inflows mitigate the negative incidence of oil rent on economic growth and below the threshold negative oil rent on growth is completely nullified. This is relevant for policy implications because policy makers are provided with actionable levels of remittances which are easily attainable in sampled countries.
    Keywords: Remittances, Natural resource rent, oil rent, Economic growth, Sub-Saharan Africa.
    JEL: F4 F43 O4
    Date: 2021–05–03
  24. By: Laurence J. Kotlikoff; Felix Kubler; Andrey Polbin; Simon Scheidegger
    Abstract: Carbon taxation is a widely proposed and in some countries already adopted means to limit anthropogenic climate change. This paper studies carbon taxation using an 18-region, 80- period overlapping generations model. We focus on carbon policy that delivers present and future mankind the highest uniform percentage welfare gain. The policy combines global carbon taxation and region- and generation-specific net transfers. In our main calibration, uniform welfare-improving carbon tax policy can make those agents already here and those yet to come, no matter their location, 4.35 percent better off. Achieving (such) equal proportionate gains, which may be needed for universal support, requires major interregional as well as intergenerational transfers. Universal support, though, is not essential. For example, even absent participation by China, whose projected carbon emissions are massive, the rest of the world can still materially limit the carbon externality. However, absent China, their optimal carbon tax is roughly half as large, and the uniform welfare-improving gain is less than three-fifths as large.
    JEL: H23 O44
    Date: 2021–09
  25. By: Ryan Kellogg; Mar Reguant
    Abstract: This paper discusses contributions that industrial organization economists have made to our understanding of energy markets and environmental regulation. We emphasize the substantive contributions of recent papers while also highlighting how this literature has adopted and sometimes augmented theoretical and empirical tools from industrial organization. Many of the topics examined by this literature—especially auctions, investment, productivity and innovation, and regulation—also apply to a variety of settings beyond energy and the environment. We also indicate areas where future research is likely to be fruitful, with an emphasis on how industrial organization economists can help inform energy and environmental policies.
    JEL: L0 Q2 Q3 Q4 Q5
    Date: 2021–09
  26. By: Simplice A. Asongu (Yaounde, Cameroon); Rexon T. Nting (London, UK)
    Abstract: In this study, we assess how the mobile phone can be leveraged upon to improve the role of governance in environmental sustainability in 44 Sub-Saharan African countries. The Generalised Method of Moments is used to establish policy thresholds. A threshold is a critical mass or level of mobile phone penetration at which the net effect of governance on Carbon dioxide (CO2) emissions changes from positive to negative. Mobile phone penetration thresholds associated with negative conditional effects are: 36 (per 100 people) for political stability/no violence; 130 (per 100 people) for regulation quality; 146.66 (per 100 people) for government effectiveness; 65 (per 100 people) for corruption-control and 130 (per 100 people) for the rule of law. Practical and theoretical implications are discussed. The study provides thresholds of mobile phone penetration that are critical in complementing governance dynamics to reduce CO2 emissions.
    Keywords: CO2 emissions; ICT; Economic development; Africa
    JEL: C52 O38 O40 O55 P37
    Date: 2021–01
  27. By: Oswald, David; Hao, Peng; Williams, Nigel; Barth, Matthew
    Abstract: As part of the City of Riverside’s Smart-City initiative, UC Riverside researchers have developed an Innovation Corridor testbed for enabling shared electric connected and automated transportation research. This Innovation Corridor testbed is located in Riverside California, and consists of a six-mile section of University Avenue between the UC Riverside campus and downtown Riverside. The testbed supports various transportation modes including passenger vehicles, trucks, transit (e.g., RTA buses), bicycles, and various forms of micro-mobility. This corridor is continuously being instrumented with various infrastructure equipment to support research in shared electric connected and automated transportation. Specifically for this project, the corridor has been equipped with roadside communications equipment and advanced traffic signal controllers at several key intersections, to help improve safety, mobility and environmental sustainability. With this initial instrumentation, we have then conducted connected vehicle experimentation that utilize the signal phase and timing (SPaT) data from these intersections to smooth traffic flow and reduce emissions. For this Innovation Corridor, a high-fidelity simulation environment was also developed to evaluate potential connected vehicle strategies. A variety of Eco-Approach and Departure (EAD) connected vehicle experiments have been conducted and evaluated, both in simulation and in the real-world. As part of the simulation ecosystem, we have compared the energy and emissions modeling results to see which best matches the real-world measurements. View the NCST Project Webpage
    Keywords: Engineering, Connected and automated vehicles, traffic modeling, eco-approach and departure
    Date: 2021–09–01
  28. By: Olatunji A. Shobande (University of Aberdeen, UK); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: Africa is currently experiencing both financial and human development challenges. While several continents have advocated for financial development in order to acquire environmentally friendly machinery that produces less emissions and ensures long-term sustainability, Africa is still lagging behind the rest of the world. Similarly, Africa's human development has remained stagnant, posing a serious threat to climate change if not addressed. Building on the underpinnings of the Environmental Kuznets Curve (EKC) hypothesis on the nexus between economic growth and environmental pollution, this study contributes to empirical research seeking to promote environmental sustainability as follows. First, it investigates the link between financial development, human capital development and climate change in East and Southern Africa. Second, six advanced panel techniquesare used, and they include: (1) cross-sectional dependency (CD) tests; (2) combined panel unit root tests; (3) combined panel cointegration tests; (4) panel VAR/VEC Granger causality tests and (5) combined variance decomposition analysis based on Cholesky and Generalised weights. Our finding shows that financial and human capital developments are important in reducing CO2 emissions and promoting environmental sustainability in East and Southern Africa.
    Keywords: Financial Development; Human Capital; East and Southern Africa; Climate Change
    JEL: G21 I21 I25 O55 Q54
    Date: 2021–01
  29. By: Stephen K. Dimnwobi (Anambra state, Nigeria); Chukwunonso Ekesiobi (Anambra state, Nigeria); Chekwube V. Madichie (Pan-Atlantic University, Lagos, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: The nexus of population dynamics and environmental degradation has been discussed widely in the extant literature. Most related studies have utilized carbon emission as a proxy of environmental quality. However, carbon emission does not capture the multidimensional nature of environmental degradation. To fill this gap, this study utilized the ecological footprint to capture environmental degradation because it is a more dynamic environmental quality measure. The paper examines the population-environmental degradation hypothesis for five populous African countries (DR Congo, Ethiopia, Nigeria, South Africa and Tanzania) using panel information from 1990-2019. The Cross-sectionally Augmented autoregressive distributed lag (CS-ARDL) was employed to assess the relationship among the data – ecological footprint per capita (ECFP), population growth rate (POPG), population density (POPD), urban population growth rate (URBN), age structure of the population (AGES), per capita GDP growth rate (PGDP), energy consumption (ENEC), and trade openness (TRAD). The findings of the study revealed that POPG, POPD, AGES, PGDP, ENEC and TRAD increase environmental degradation. Urbanization (URBN) has no significant influence on environmental degradation in the selected African countries. The study concludes with policy prescriptions geared towards addressing population expansion and improving environmental quality.
    Keywords: Population dynamics, Environmental degradation, Africa
    JEL: C40 J11 O10 Q50
    Date: 2021–01
  30. By: Arnold, Fabian (Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI)); Jeddi, Samir (Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI)); Sitzmann, Amelie (Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI))
    Abstract: Within the regulation of net purchasing, investment incentives for residential PV depend on the remuneration for grid feed-in and the consumption costs that households can save by self-consumption. Network tariffs constitute a substantial part of these consumption costs. We use postcode-level data for Germany between 2009 and 2017 and exploit the regional heterogeneity of network tariffs to investigate whether they encourage to invest in PV installations and evaluate how the nonlinear tariff structure impacts residential PV adoption. Our results show that network tariffs do impact PV adoption. The effect has increased in recent years when self-consumption has become financially more attractive, and the results confirm the expectation that PV investments are driven by the volumetric tariff. Policy reforms that alter the share between the price components are, thus, likely to affect residential PV adoption. Further, with self-consumption becoming a key incentive, price signals can effectively support the coordination of electricity demand and supply in Germany.
    Keywords: Network tariffs; PV investments; self-consumption; price perception; panel data; prosumer; non-linear prices
    JEL: C33 D12 L51 Q42
    Date: 2021–09–20
  31. By: Harouna Kinda (CERDI - Centre d'Études et de Recherches sur le Développement International - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne); Noel Thiombiano
    Abstract: The extractive industries (oil, gas, and mining) play a dominant economic, social, and political role in the lives of approximately 3.5 billion people living in 81 countries across the world. However, the benefits come at a cost that is no longer limited to the problems of the ‘curse of natural resources', but also includes the damage of greenhouse gas emissions, pollution, and biodiversity that extraction wreaks on the environment. This paper revisits the links between man-made and natural capital in developing countries, focusing on the case of forest cover loss . Considering a theoretical model of income maximization, we assess through empirical observation the impact of extractive industries on forest cover loss. Based on a panel of 52 resource-rich developing countries, over the period 2001-2017, we adopt a dynamic specification with the two-step Generalized Method of Moments (GMM) system to address the inherent bias. Our main results show that the total rent from the extractive industries is detrimental to the forest. More specifically, mineral and gas rents accelerate forest cover loss. In contrast, oil rents contribute to reducing forest cover loss. In addition, we find that natural resource tax revenues contribute to reducing forest cover loss. Our results suggest substitutability between oil rents (natural resource tax revenues and forest natural capital), and complementarity between mineral rents (gas rents and forest natural capital). To promote corporate environmental management, stakeholders must overcome regulatory inefficiencies in exploration and exploitation contracts so that environmental compensation is at least equal to the marginal damage caused by the extractive industries.
    Date: 2021–07–04
  32. By: Ehsan Samani; Mahdi Kohansal; Hamed Mohsenian-Rad
    Abstract: Convergence bidding, a.k.a., virtual bidding, has been widely adopted in wholesale electricity markets in recent years. It provides opportunities for market participants to arbitrage on the difference between the day-ahead market locational marginal prices and the real-time market locational marginal prices. Given the fact that convergence bids (CBs) have a significant impact on the operation of electricity markets, it is important to understand how market participants strategically select their CBs in real-world. We address this open problem with focus on the electricity market that is operated by the California ISO. In this regard, we use the publicly available electricity market data to learn, characterize, and evaluate different types of convergence bidding strategies that are currently used by market participants. Our analysis includes developing a data-driven reverse engineering method that we apply to three years of real-world data. Our analysis involves feature selection and density-based data clustering. It results in identifying three main clusters of CB strategies in the California ISO market. Different characteristics and the performance of each cluster of strategies are analyzed. Interestingly, we unmask a common real-world strategy that does not match any of the existing strategic convergence bidding methods in the literature. Next, we build upon the lessons learned from the existing real-world strategies to propose a new CB strategy that can significantly outperform them. Our analysis includes developing a new strategy for convergence bidding. The new strategy has three steps: net profit maximization by capturing price spikes, dynamic node labeling, and strategy selection algorithm. We show through case studies that the annual net profit for the most lucrative market participants can increase by over 40% if the proposed convergence bidding strategy is used.
    Date: 2021–09
  33. By: Anthony D'Agostino; Alejandra Nicte Aponte; Sam Studnitzer; Eva Ward; Anu Rangarajan
    Abstract: The evaluation’s key objectives are to understand the effectiveness of TA delivery in supporting cities’ efforts towards the goal of collecting GHG emissions data, reporting a GHG emissions inventory, and developing mitigation actions.
    Keywords: Climate action, climate change, C40, cities, GHG inventory, technical assistance
  34. By: Ajayi, V.; Weyman-Jones, T.; ;
    Abstract: This paper examines the impact of deregulation and the political support for it on the electric power industry using a consistent state-level electricity generation dataset for the US contiguous states from 1997-2014. Recent analyses of productivity growth suggests that institutional factors are important and we wish to study the role of deregulation as a statelevel institutional change through two measures: (a) restructuring and (b) the political support for it, measured by the majority political affiliation of public utility commissions. We find evidence of positive impacts of deregulation (both restructuring and the political support for it) on technical efficiency across the models estimated. Our preferred model which allows for the control for deregulation variables on the mean and variance of the inefficiency shows an average technical efficiency of 73.1 percent. The results of the marginal effects reveal that the impact of deregulation including its political support on inefficiency is negative and monotonic, with the potential reduction of 8.4 percent in the mean of technical inefficiency, thereby suggesting a compelling evidence for generation efficiency improvement via deregulation.
    Keywords: Electricity generation, technical efficiency, marginal effect, restructuring, regulatory institutions
    JEL: C23 D24 L51 L94
    Date: 2021–09–22
  35. By: Nicolò Barbieri (Department of Economics and Management, University of Ferrara, Ferrara, Italy); Alberto Marzucchi (Gran Sasso Science Institute, Social Sciences, L’Aquila, Italy); Ugo Rizzo (Department of Mathematics and Computer Science, University of Ferrara, Ferrara, Italy)
    Abstract: The present study explores the technological complementarities between green and non-green inventions. First, we look at whether inventive activities in climate-friendly domains depend on patenting in related technological domains that are not green. Based on patent data filed over the 1978–2014 period, we estimate a spatial autoregressive model using co-occurrence matrices to capture technological interdependencies. Our first finding highlights that the development of green technologies strongly relies on advances in other green and in particular non-green technological domains, whose relevance for the green economy is usually neglected. Building on this insight, we detect the non-green complementary technologies that co-occur with green ones and assess whether environmental policies affect this particular instantiation of technologies at the country level. The results of the instrumental variable approach confirm that while environmental policies spur green patenting, they do not displace the development of the non-green technological pillars upon which green inventions develop.
    Keywords: Green technology, patent data, environmental policy, network-dependent innovation
    JEL: H23 O31 Q58 Q55
    Date: 2021–09
  36. By: Ahmed S. Alahmed; Lang Tong
    Abstract: We introduce NEM X, an inclusive retail tariff model that captures features of existing net energy metering (NEM) policies. It is shown that the optimal prosumer decision has three modes: (a) the net-consuming mode where the prosumer consumes more than its behind-the-meter distributed energy resource (DER) production when the DER production is below a predetermined lower threshold, (b) the net-producing mode where the prosumer consumes less than its DER production when the DER production is above a predetermined upper threshold, and (c) the net-zero energy mode where the prosumer's consumption matches to its DER generation when its DER production is between the lower and upper thresholds. Both thresholds are obtained in closed-form. Next, we analyze the regulator's rate-setting process that determines NEM X parameters such as retail/sell rates, fixed charges, and price differentials in TOU tariffs in on and off-peak periods. A stochastic Ramsey pricing program is formulated that maximizes social welfare subject to the revenue break-even constraint for the regulated utility. Performance of NEM X policies is evaluated using real and synthetic data to illuminate impacts of NEM policy designs on social welfare, cross-subsidies of prosumers by consumers, and payback time of DER investments that affect long-run DER adoptions.
    Date: 2021–09
  37. By: Jaller, Miguel; Pahwa, Anmol; Zhang, Michael
    Abstract: Freight is fundamental to economic growth, however, the trucks that haul this freight are pollution intensive, emitting criteria pollutants and greenhouse gases at high rates. The increasing volume and time-sensitivity of freight demand over the past decade has encouraged carriers to take the fastest route, which is often not an eco-friendly route. The increase in urban freight movement has thus brought along negative externalities such as congestion, emissions, and noise into cities. Alternative fuel technologies, such as electric trucks and hydrogen-fuel trucks can significantly reduce freight-related emissions. However, despite their lower operational costs, the high purchase cost and consequent longer payback periods compared to traditional vehicles, have resulted in slow adoption rates. Since the need to reduce global greenhouse gas emissions and local criteria pollutants is immediate, accounting for externalities in carriers’ tactical and operational decision-making in the form of eco-routing can bring about desired reductions in emissions. The objectives of this work are to explore the possibilities and potential of eco-routing from the perspective of the carrier, in terms of cost-benefits and trade-offs, and from the perspective of the regulator, in terms of network-wide effects and policy initiatives that could encourage carriers to eco-route. This study evaluates reduction in global greenhouse emissions and local criteria pollutants, with a particular focus on direct impacts on disadvantaged communities in the Southern California Association of Governments (SCAG) region.
    Keywords: Engineering, Eco-routing, multi-criteria traffic assignment, origin-based traffic assignment, TAPAS, geofencing
    Date: 2021–09–01
  38. By: Théophile Azomahou (AERC - African Economic Research Consortium); Njuguna Ndung'U (AERC - African Economic Research Consortium); Mahamady Ouedraogo (CERDI - Centre d'Études et de Recherches sur le Développement International - CNRS - Centre National de la Recherche Scientifique - UCA - Université Clermont Auvergne)
    Abstract: Oil-dependent countries face a twin-shock: in addition to the COVID-19 outbreak, they are facing an oil price collapse. In this paper, we study the impact of this dual shock on the forecasted GDP growth in Africa using the COVID-19 outbreak as a natural experiment. We use the IMF World Economic Outlook's GDP growth forecasts before and after the outbreak. We find that COVID-19 related deaths result in -2.75 percentage points forecasted GDP growth loss in the all sample while oil-dependence induces -7.6 percentage points loss. We document that the joint shock entails higher forecasted growth loss in oil-dependent economies (-10.75 percentage points). Based on oil price forecasts and our empirical findings, we identify five recovery policies with high potential: social safety net policy, economic diversification, innovation and technological transformation, fiscal discipline, and climate-friendly recovery policy.
    Keywords: Africa,growth forecast,oil-dependence,COVID-19
    Date: 2021
  39. By: Nathan Ratledge; Gabriel Cadamuro; Brandon De la Cuesta; Matthieu Stigler; Marshall Burke
    Abstract: In many regions of the world, sparse data on key economic outcomes inhibits the development, targeting, and evaluation of public policy. We demonstrate how advancements in satellite imagery and machine learning can help ameliorate these data and inference challenges. In the context of an expansion of the electrical grid across Uganda, we show how a combination of satellite imagery and computer vision can be used to develop local-level livelihood measurements appropriate for inferring the causal impact of electricity access on livelihoods. We then show how ML-based inference techniques deliver more reliable estimates of the causal impact of electrification than traditional alternatives when applied to these data. We estimate that grid access improves village-level asset wealth in rural Uganda by 0.17 standard deviations, more than doubling the growth rate over our study period relative to untreated areas. Our results provide country-scale evidence on the impact of a key infrastructure investment, and provide a low-cost, generalizable approach to future policy evaluation in data sparse environments.
    JEL: O11 O18 Q01 Q4
    Date: 2021–09
  40. By: ITF
    Abstract: This report presents an analysis of current transport activity in India and reviews key policy instruments set up by Indian institutions to shape transport developments in the coming years. It also investigates future scenarios of transport in India and outlines key aspects that should be considered in the upcoming work on transport decarbonisation. The final section builds on these insights, charting a way forward for a climate change mitigation strategy for the Indian transport sector. In particular, it underlines the importance of taking an approach that is not limited to direct GHG emission reductions but takes into account a lifecycle perspective.
    Date: 2021–02–22
  41. By: Alessio Muscillo; Simona Re; Sergio Gambacorta; Giuseppe Ferrara; Nicola Tagliafierro; Emiliano Borello; Alessandro Rubino; Angelo Facchini
    Abstract: We present a circularity transition index based on open data principles and circularity of energy, material, and information. The aim of the Circular City Index is to provide data and a succinct measurement of the attributes related to municipalities performances that can support the definition of green policies at national and local level. We have identified a set of key performance indicators, defined at municipality level, measuring factors that, directly and indirectly, could influence circularity and green transition, with a focus on the green new deal vision embraced by the European Union. The CCI is tested on a open dataset that collects data covering 100% of the Italian municipalities (7,904). Our results show that the computation of the CCI on a large sample leads to a normal distribution of the index, suggesting disparities both under the territorial point of view and under the point of view of city size. Results provide useful information to practitioner, policy maker and experts from academia alike, to define effective tools able to underpin a careful planning of investments supported by the national recovery and resilience plan recently issued by the Italian government. This may be particularly useful to enhance enabling factors of the green transition that may differ across territories, helping policymakers to promote a smooth and fair transition by fostering the preparedness of municipalities in addressing the challenge.
    Date: 2021–09
  42. By: Penelope Buckley (GAEL - Laboratoire d'Economie Appliquée de Grenoble - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes)
    Date: 2021–09–01
  43. By: Catherine Locatelli (GAEL - Laboratoire d'Economie Appliquée de Grenoble - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes)
    Abstract: Depuis l'effondrement de l'Union soviétique, la question de la réforme de l'industrie gazière russe et de sa principale compagnie Gazprom est l'objet d'importants débats. Elle s'avère être un enjeu important pour les équilibres des marchés régionaux du gaz naturel en particulier pour l'Europe et de plus en plus pour l'Asie. Aujourd'hui se dessine une voie de réforme en accord avec les caractéristiques institutionnelles et politiques de l'économie russe. Ces principales caractéristiques sont le fruit d'une recombinaison entre des anciennes et des nouvelles formes institutionnelles. Ainsi, les processus de sédimentation/hybridation institutionnelles à l'œuvre dans le secteur gazier russe conduisent à une restructuration majeure du secteur et dessinent une voie de réforme originale.
    Keywords: Russie,Industrie du gaz naturel
    Date: 2021
  44. By: Lynn Riggs (Motu Economic and Public Policy Research); Livvy Mitchell (Motu Economic and Public Policy Research)
    Abstract: Efforts to reduce emissions to counter climate change are expected to have both costs and benefits, and these effects are likely to be unevenly distributed across the population. Hence, we developed the Distributional Impacts Microsimulation for Employment (DIM-E) to examine the potential distributional employment impacts for different mitigation options to reduce greenhouse gas emissions. DIM-E is comprised of two main components: the first component estimates industry-level employment effects, and the second simulates the characteristics of impacted workers and jobs. We based DIM-E on results from a computable general equilibrium (CGE) model, C-PLAN, and applied them to more detailed employment information in order to better understand the extent to which industries, jobs and workers are likely to be impacted by the different pathways. It is possible, however, for DIM-E to be used to analyse any policy scenario and its baseline using employment indices and similar employment information. In this paper, we describe DIM-E in the context of the initial case for which it was developed – to analyse emissions budgets for greenhouse gasses to be set by the New Zealand government for three time periods (2022-2025, 2026-2030, and 2031-2035). We also provide a sampling of results from this initial case in order to put the methodology into context. Hence, we show that DIM-E can be used to examine changes in employment trends due to policy changes as well as the different types of workers that are most likely to be affected by the reallocation of employment across industries. We found that the DIM-E results produced for the initial case were in line with previous research in this area – the overall net industry employment effects were predicted to be relatively small, though some industries will be more affected than others especially in the short- and medium-term. Moreover, very few worker groups would be negatively affected (in terms of the number of jobs) by any of the proposed mitigation options especially over the long term.
    Keywords: Environmental Economics, Climate Change Mitigation, Distributional Impacts of Employment
    JEL: J01 Q52 R11
    Date: 2021–09
  45. By: David K Levine
    Date: 2021–08–27
  46. By: Drudi, Francesco; Moench, Emanuel; Holthausen, Cornelia; Weber, Pierre-François; Ferrucci, Gianluigi; Setzer, Ralph; Adao, Bernardino; Dées, Stéphane; Alogoskoufis, Spyros; Téllez, Mar Delgado; Andersson, Malin; Di Nino, Virginia; Aubrechtova, Jana; Diez-Caballero, Arturo; Avgousti, Aris; Duarte, Claudia; Barbiero, Francesca; Estrada, Ángel; Boneva, Lena; Faccia, Donata; Breitenfellner, Andreas; Faiella, Ivan; Bua, Giovanna; Farkas, Mátyás; Bun, Maurice; Ferrari, Alessandro; Caprioli, Francesco; Fornari, Fabio; Ciccarelli, Matteo; Mendoza, Alberto Fuertes; Darracq Pariès, Matthieu; Garcia-Sanchez, Pablo; Giovannini, Alessandro; Papadopoulou, Niki; Grüning, Patrick; Parker, Miles; Guarda, Paolo; Petroulakis, Filippos; Hebbink, Gerbert; Piloiu, Anamaria; Murphy, Sarah Jane Hlásková; Ploj, Gasper; Ioannidis, Michael; Pointner, Wolfgang; Isgro, Lorenzo; Popov, Alexander; Kapp, Daniel; Prammer, Doris; Kashama, Mélissa Kasongo; Queiroz, Ricardo; Lopez-Garcia, Paloma; Rachedi, Omar; Lozej, Matija; Rognone, Lavinia; Lydon, Reamonn; Röhe, Oke; Manninen, Otso; Roos, Madelaine; Manzanares, Andrés; Russo, Simone; McInerney, Niall; Santabárbara, Daniel; Meinerding, Christoph; Schotten, Guido; Mikkonen, Katri; Sotomayor, Beatriz; Mistretta, Alessandro; Stracca, Livio; Mongelli, Francesco Paolo; Tamburrini, Fabio; Montes-Galdón, Carlos; Theofilakou, Anastasia; Müller, Georg; Tsalaporta, Pinelopi; Nerlich, Carolin; van den End, Jan Willem; Osiewicz, Malgorzata; Cruz, Lia Vaz; Osorno-Torres, Boris; Weth, Mark Andreas; Ouvrard, Jean-François; Gomez, Gonzalo Yebes; Page, Adrian
    Abstract: This paper analyses the implications of climate change for the conduct of monetary policy in the euro area. It first investigates macroeconomic and financial risks stemming from climate change and from policies aimed at climate mitigation and adaptation, as well as the regulatory and fiscal effects of reducing carbon emissions. In this context, it assesses the need to adapt macroeconomic models and the Eurosystem/ECB staff economic projections underlying the monetary policy decisions. It further considers the implications of climate change for the conduct of monetary policy, in particular the implications for the transmission of monetary policy, the natural rate of interest and the correct identification of shocks. Model simulations using the ECB’s New Area-Wide Model (NAWM) illustrate how the interactions of climate change, financial and fiscal fragilities could significantly restrict the ability of monetary policy to respond to standard business cycle fluctuations. The paper concludes with an analysis of a set of potential monetary policy measures to address climate risks, insofar as they are in line with the ECB’s mandate. JEL Classification: E52, E58, Q54
    Keywords: climate change, environmental economics, green finance, monetary policy, sustainable growth economics
    Date: 2021–09

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