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on Energy Economics |
| By: | Nobuhiro Hosoe (National Graduate Institute for Policy Studies, Tokyo, Japan) |
| Abstract: | We use a computable general equilibrium model of world trade to quantify the possible impact of economic sanctions imposed by the Western and other countries in response to Russia’s invasion of Ukraine. If senders chose 100% import tariffs and export taxes on trade with Russia, Russia’s GDP would decline by 3–7% due to a significant reduction in exports. By contrast, the GDP loss for those countries would be the largest for Europe but only about 0.2%, and 0.05% for Japan. The effect of China’s participation in the sanctions is more significant than that of India. There are concerns about food and energy crises due to economic sanctions against Russia, but food supplies would not be a serious problem for either senders or third parties. The impact on energy supplies would affect all senders to some extent, for example with a reduction of energy consumption by 3% in and a rise in electricity and town gas prices by 3–4% in Japan. |
| Keywords: | Russian invasion; Ukraine; economic sanctions; energy security; food security; simulation |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:ngi:dpaper:22-06&r= |
| By: | Hutter, Christian (Institute for Employment Research (IAB), Nuremberg, Germany); Weber, Enzo (Institute for Employment Research (IAB), Nuremberg, Germany ; Univ. Regensburg) |
| Abstract: | "With the Russian war against Ukraine, global economic conditions changed abruptly. We provide first causal evidence of effects of the energy crisis on Germany as Europe’s most important economy. Combining cost structure data, national accounts and administrative labour market data, we identify effects in a sectoral panel setting. The results show that via the channel of energy intensity, production decreased by about 1 percent with the onset of the war, but turnover increased, mirroring sales from stock. Firms safeguard employment via short-time work with 10 percent additional applications. Vacancy posting was reduced already in anticipation by 8 percent." (Author's abstract, IAB-Doku) ((en)) |
| Keywords: | IAB-Open-Access-Publikation |
| JEL: | E23 H56 J63 Q43 |
| Date: | 2022–05–16 |
| URL: | http://d.repec.org/n?u=RePEc:iab:iabdpa:202210&r= |
| By: | Bruno Castanho Silva (Cologne Center for Comparative Politics); Jens Wäckerle; Christopher Wratil |
| Abstract: | Western powers have discussed and implemented several policies in response to the full scale Russian invasion of Ukraine in February 2022. One such possible answer was an immediate embargo on all Russian energy exports to the EU. While seen as a strong measure against Russia's war effort, some EU governments were unenthusiastic, due to potential negative economic impacts on the short run, by pressuring prices for consumers and fueling inflation. Public opinion also seemed divided on the matter. We use a framing survey experiment in Germany (n = 3,251) to test what factors influence support for an immediate embargo against Russian energy. Results indicate that out of seven possible frames tested, the only one that has an effect on embargo support is whether the rest of the German public is in favor or not. Results are in line with contemporary models of public opinion formation and legitimacy, and shed light on the conditions that may help framing other potentially costly issues to garner public support, such as measures to tackle climate change. |
| Keywords: | public opinion; survey experiment; Russian energy embargo; foreign policy; Ukraine war |
| JEL: | D91 |
| Date: | 2022–06 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkdps:170&r= |
| By: | Bähr, Cornelius; Fremerey, Melinda; Fritsch, Manuel; Obst, Thomas |
| Abstract: | Russland ist nicht nur ein wesentlicher Gas-Exporteur für Deutschland, sondern liefert auch wichtige Rohstoffe für die deutsche Industrie. Deutschland und der Weltmarkt sind vor allem bei Nickel, Palladium und Chrom abhängig von russischen Exporten. Dies sind Rohstoffe, die zum Teil schwierig zu substituieren sind. Daher sind neue Handelsbeziehungen zu alternativen Exportnationen für diese Rohstoffe essenziell. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwkkur:312022&r= |
| By: | Huntington, Hillard G.; Liddle, Brantley |
| Abstract: | New fears about escalating fuel prices and accumulating inflation are raising concerns about the possible dimming of near-term prospects for world economic growth. The role of energy prices in shaping economic growth relates not only to geopolitical risks or environmental taxes but also to a range of strategies that place moratoria on primary energy sources like nuclear, coal, petroleum, and natural gas. Applying a new data set for country-level energy prices since 1960, this study evaluates the effects of energy prices on economic growth in 18 OECD countries by controlling for other important macroeconomic conditions that shape economic activity. Mean-group estimates that control for cross-country correlations are used to emphasize average responses across nations. Averaged across all nations, results suggest that a 10 percent increase in energy prices dampened economic growth by about 0.15 percent. Moreover, some evidence exists that this response may be larger for more energy-intensive economies. |
| Keywords: | OECD economic growth; energy prices; cross-country panel analysis |
| JEL: | C23 O47 Q43 Q54 |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113040&r= |
| By: | Ralph De Haas; Ralf Martin; Mirabelle Muuls; Helena Schweiger |
| Abstract: | We use data on 10,852 firms across 22 emerging markets to analyse how credit constraints and deficient firm management inhibit corporate investment in green technologies. For identification, we exploit quasi-exogenous variation in local credit conditions. Our results indicate that both credit constraints and green managerial constraints slow down firm investment in more energy efficient and less polluting technologies. Complementary analysis of data from the European Pollutant Release and Transfer Register (E-PRTR) reveals the pollution impact of these constraints. We show that in areas where more firms are credit constrained and weakly managed, industrial facilities systematically emit more CO2 and other gases. This is corroborated by the finding that in areas where banks needed to deleverage more after the Global Financial Crisis, industrial facilities subsequently reduced their carbon emissions considerably less. On aggregate this kept CO2 emissions 5.6% above the level they would have been in the absence of credit constraints. |
| Keywords: | credit constraints, green management, CO2 emissions, energy efficiency |
| Date: | 2022–12 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1837&r= |
| By: | Stern, Nicholas |
| Abstract: | The case for action on climate change with urgency and at scale rests on the immense magnitude of climate risk, the very rapid emissions reductions which are necessary, and that there is a real opportunity to create a new and attractive form of growth and development. The analysis must be based on a dynamic approach to the economics of public policy, set in a complex, imperfect and uncertain world. The economics of climate change, and further, economics more broadly, must change to respond to the challenge of how to foster rapid transformation. It is time for economics and economists to step up. |
| Keywords: | climate change; economic analysis; public policy; investment; innovation; ES/R009708/1; OUP deal |
| JEL: | N0 |
| Date: | 2022–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:113456&r= |
| By: | Comello, Stephen (Stanford U); Reichelstein, Julia (Piva Capital, San Francisco); Reichelstein, Stefan (U of Mannheim and Stanford U) |
| Abstract: | We propose and describe a corporate carbon reporting framework intended to strengthen the credibility and transparency of the existing net-zero pledges. We refer to this framework as the Time-Consistent Corporate Carbon Reporting (TCCR) standard. Firms adhering to the TCCR framework would commit to disclose: (i) firm annual carbon emissions determined according to a core metric which we define as the Direct Net Emissions (DNE), (ii) an initial forecast of the firm’s future emissions trajectory up to the year 2050, and (iii) periodic revisions of the forecast emission trajectories for the remaining years up to 2050. In addition to DNE disclosures at the corporate entity level, we advocate for firms to adopt a system of accumulating and reporting carbon balances at the product level. When added up across all products and services sold to the firm’s customers, these carbon balances would effectively absorb the firm’s annual DNE, and the carbon balances accumulated in the production inputs from the firm’s upstream suppliers. Borrowing a concept from the construction industry, this sequential process would ensure that products delivered to a firm’s customers reflect the embodied carbon accumulated through the entire upstream supply chain. |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:ecl:stabus:4016&r= |
| By: | Chepeliev, Maksym |
| Abstract: | Since GTAP 5 Data Base, a special satellite account that estimates CO2 emissions from fossil fuel combustion has been developed (Lee, 2002). A corresponding approach to the estimation of emissions has remained unchanged since then and relies on the Tier 1 method of the 1996 IPCC Guidelines (IPCC/OECD/IEA, 1997). However, a number of concerns regarding discrepancies between GTAP CO2 emissions data and other international data sources, such as EDGAR and IEA, have been raised. In this paper, we compare GTAP CO2 emissions data with other international data sources and quantify the revealed discrepancies. To address the identified differences, we develop and implement a revised emissions accounting framework based on the Tier 1 method of the 2006 IPCC Guidelines. Our revised approach includes estimation of emission factors at a more granular commodity level than implemented in the standard GTAP 10A Data Base. Two additional refinements include an updated accounting of emissions from blast furnaces and other recovered gases, as well as a more transparent treatment of CO2 emissions from flaring. We implement an updated emissions accounting framework for the case of GTAP 11 energy database and show that it helps to substantially reduce discrepancies between GTAP and other international data sources both at the global and country levels. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:gta:resmem:6695&r= |
| By: | De Juan Fernández, Aránzazu; Poncela, Pilar; Rodríguez Caballero, Carlos Vladimir; Ruiz Ortega, Esther |
| Abstract: | In this paper,we surve yrecent econometric contributions t omeasure the relationship between economic activity and climate change.Due to the critical relevance of these effectsfor the well-being of future generations,there is an explosion of publications devoted to measuring this relationship and its main channels.The relation between economic activity andclimate change is complex with the possibility of causality running in both directions. Starting from economic activity,the channels that relate economic activity and climate changeare energy consumption and the consequent pollution. Hence, we first describe the main econometric contributions about the interactions between economic activity and energy consumption, moving then to describing the contributions on the interactions between economicactivity and pollution. Finally, we look at the main results on the relationship between climate change and economic activity. An important consequence of climate change is the increasing occurrence of extreme weather phenomena. Therefore,we also survey contributions on the economice effects of catastrophic climate phenomena. |
| Keywords: | Catastrophic Weather; Energy Consumption; Environmental Kuznets Curve; Global Warming; Greenhouse Gases; Temperature Trends |
| Date: | 2022–06–08 |
| URL: | http://d.repec.org/n?u=RePEc:cte:wsrepe:35044&r= |
| By: | Olivier Chanel; Alberto Prati; Morgan Raux |
| Abstract: | We provide an estimate of the environmental impact of the recruitment system in the economics profession, known as the "international job market for economists". Each year, most graduating PhDs seeking jobs in academia, government, or companies participate in this job market. The market follows a standardized process, where candidates are pre-screened in a short interview which takes place at an annual meeting in Europe or in the United States. Most interviews are arranged via a non-profit online platform, econjobmarket.org, which kindly agreed to share its anonymized data with us. Using this dataset, we estimate the individual environmental impact of 1,057 candidates and one hundred recruitment committees who attended the EEA and AEA meetings in December 2019 and January 2020. We calculate that this pre-screening system generated the equivalent of about 4,000 tons of avoidable CO2-eq and a comprehensive economic cost over e3.5 million. We contrast this overall assessment against three counterfactual scenarios: a more efficient in-person system, a hybrid system (where videoconference is used for some candidates) and a fully online system (as it happened in 2020-21 due to the COVID-19 pandemic). Overall, the study can offer useful information to shape future recruitment standards in a more sustainable way. |
| Keywords: | job market for economists, international job market, carbon footprint, environmental impact, comprehensive economic cost |
| Date: | 2021–12–15 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1819&r= |
| By: | Fremerey, Melinda; Iglesias, Simon Gerards |
| Abstract: | Ein Gasembargo gegen Russland wird derzeit heftig diskutiert. Ein potenzieller Ausfall von Gas in der deutschen Industrie würde vor allem die Branchen der Grundstoffchemie, Papierindustrie sowie die Metallerzeugung und Glas- und Keramikherstellung hart treffen. Diese Industrien weisen einen hohen Gasverbrauch und ein geringes Substitutions- und Einsparpotential von Gas auf. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iwkkur:402022&r= |
| By: | José-Luis Cruz; Esteban Rossi-Hansberg |
| Abstract: | We study local carbon policy to address the consequences of climate change. Standard analysis suggests that the social cost of carbon determines optimal carbon policy. We start by using the spatial integrated assessment model in Cruz and Rossi-Hansberg (2021) to measure the local social monetary cost of CO² emissions: the Local Social Cost of Carbon (LSCC). Although the largest welfare costs from global warming are concentrated in the warmest parts of the developing world, adjusting for the local marginal utility of income implies that the LSCC peaks in warm and high-income regions like the southern parts of the U.S. and Europe, as well as Australia. We then proceed to study the effect of the actual carbon reduction pledges in the Paris Agreement and the progress they can make in implementing the expressed goal of keeping global temperature increases below 2°C. We find that although the distribution of pledges is roughly in line with the LSCC, their magnitude is largely insufficient to achieve its goals. The required carbon taxes necessary to keep temperatures below 2°C over the current century are an order of magnitude higher and involve large implicit inter-temporal transfers. Increasing the elasticity of substitution across energy sources is important to reduce the carbon taxes necessary to achieve warming goals. |
| JEL: | F1 O18 Q5 R1 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30027&r= |
| By: | Tiziano De Angelis; Peter Tankov; Olivier David Zerbib |
| Abstract: | This paper shows how green investing spurs companies to mitigate their carbon emissions by raising the cost of capital of the most carbon-intensive companies. Companies’ emissions decrease when the wealth share of green investors and their sensitivity to climate externalities increase. We show that the impact of green investors primarily governs companies’ long-run emissions. Companies are further incentivized to reduce their emissions when green investors anticipate tighter climate regulations and climate-related technological innovations. However, heightened uncertainty regarding future climate risks alleviates green investors’ pressure on the cost of capital of companies and pushes them to increase their emissions. Calibrated on United States data, our model suggests that, albeit effective, the impact of green investors remains limited given their current wealth share and practices. |
| Keywords: | Climate finance, socially responsible investing, ESG, impact investing |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:cca:wpaper:676&r= |
| By: | Sareh Vosooghi; Maria Arvaniti; Frederick Van Der Ploeg |
| Abstract: | This paper studies the formation of international climate coalitions by heterogeneous countries. Countries rationally predict the consequences of their membership decisions in climate negotiations. We offer an approach to characterise the equilibrium number of coalitions and their number of signatories independent of their heterogeneity, and we suggest a tractable algorithm to fully characterise the equilibrium. In a dynamic game analysis of a general equilibrium model of the economy integrated with climate dynamics, a grand climate coalition or multiple climate coalitions may form in equilibrium, but if the policymakers are patient, the number of signatories in all climate treaties is a Tribonacci number. Our results are robust to the possibility of renegotiation and investment in green technologies besides fossil fuels. |
| Date: | 2022–05–23 |
| URL: | http://d.repec.org/n?u=RePEc:oxf:wpaper:971&r= |
| By: | Sirini Jeudy-Hugo (OECD); Leon Charles |
| Abstract: | This paper explores modalities, enablers, and political moments that could help to translate the outputs of the global stocktake (GST) into an outcome that informs and enhances national and international actions as intended in the Paris Agreement. How to move from the collective outputs of the GST to desired outcomes is critical but not straightforward. Drawing on lessons learnt from previous international assessment and review processes under the UNFCCC and beyond, this paper sets out insights on modalities, outputs and enabling factors that could help ensure the GST leads to action on the ground. The paper concludes that achieving the outcomes of the GST requires a well-designed process that effectively engages Parties and non-Party stakeholders in separate but sequenced technical and political discussion tracks. The paper also finds that specific, actionable outputs that target different actors can facilitate subsequent follow-up. The paper identifies different enabling factors that could support the translation of GST outputs formulated at the collective level into national processes to update and enhance actions and support. It also highlights the importance of leveraging different political moments and building linkages with parallel processes, both within and outside the UNFCCC context, to maintain momentum on the GST and ensure operational action follows over time so that collective efforts are in line with the long-term goals of the Paris Agreement. |
| Keywords: | Climate change, Global stocktake, LT-LEDS, NDCs, Outcomes, Outputs, Paris Agreement, UNFCCC |
| JEL: | Q54 Q56 Q58 F53 |
| Date: | 2022–05–31 |
| URL: | http://d.repec.org/n?u=RePEc:oec:envaab:2022/01-en&r= |
| By: | Pierre Pech (LADYSS - Laboratoire Dynamiques Sociales et Recomposition des Espaces - UP1 - Université Paris 1 Panthéon-Sorbonne - UP8 - Université Paris 8 Vincennes-Saint-Denis - UPN - Université Paris Nanterre - UPD7 - Université Paris Diderot - Paris 7 - CNRS - Centre National de la Recherche Scientifique); Cécile Gauthier; Justine Muller; Delphine Giney; Hélène Sirota-Chelzen |
| Abstract: | This article explores the relationship between people living in a territory and their territory in the specific case of development projects. We focus here on two cases of wind infrastructure development projects in sparsely populated areas in France. Environmental Impact Assessment (EIA) has become a regulatory process in most countries. This procedure includes surveys of the inhabitants of the areas affected by infrastructure projects. The survey carried out in two rural areas, in the French departments of Allier and Vaucluse, concerns the relations between the representations of the inhabitants relating to wind energy and their representation of their territory. The statements of the interviewed persons allow opposing the representations that the inhabitants have over their territory. In the Allier, the landscape is felt to be poor, downgraded because most of the inhabitants and part of the built heritage preserve the memory of an industrial activity considered to have made the territory dynamic. The landscape's visual object, "wind turbine," is not considered unfavourable because it represents a positive image of the territory. On the other hand, in Haute Provence, the inhabitants, for the most part, neo-retired or secondary residents on the outskirts of large cities, see wind turbines negatively. |
| Abstract: | VertigO-la revue électronique en sciences de l'environnement Volume 21 numéro 2 | Octobre 2021 Sociétés, territoires et environnement, comment repenser les interconnexions entre les milieux humains et naturels ? L'habitant et son territoire dans les procédures d'aménagement : l'exemple de projets éoliens dans l'Allier et dans le Vaucluse, France The inhabitant and his territory in planning procedures: the example of wind power projects in Allier and Vaucluse, France et article propose une exploration de la question des relations entre les individus qui habitent sur un territoire et leur territoire dans le cas précis des projets d'aménagement. Nous nous attachons ici à deux cas de projets d'aménagement d'infrastructures éoliennes dans des secteurs peu denses en France. L'évaluation d'impact environnemental (EIE) s'est imposée comme démarche réglementaire dans la plupart des pays. Cette procédure intègre des enquêtes auprès des habitants des territoires concernés par des projets d'infrastructure. L'enquête menée dans deux secteurs ruraux, dans les départements français de l'Allier et du Vaucluse, concerne les relations entre les représentations des acteurs habitants concernant l'éolien avec leur représentation de leur territoire. Les dires des personnes interrogées permettent d'opposer selon les représentations qu'ont les habitants sur leur territoire. Dans l'Allier, le paysage est ressenti comme pauvre, déclassé, parce que la majorité des habitants et une partie du patrimoine bâti conservent la mémoire d'une activité industrielle considérée comme ayant fait le dynamisme du territoire. L'objet visuel « éolienne » dans le paysage n'est pas considéré comme négatif parce qu'il représente une image positive du territoire. À l'inverse, en Haute Provence, les habitants, pour la plupart des néo-retraités ou des résidents secondaires périphériques de grandes villes voient les éoliennes négativement. |
| Keywords: | étude d’impact environnemental,éolien,représentation,territoire |
| Date: | 2021–10–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03646661&r= |
| By: | Ruhnau, Oliver; Schiele, Johanna |
| Abstract: | Electrolytic hydrogen complements renewable energy in many net-zero energy scenarios. In these long-term scenarios with full decarbonization, the “greenness” of hydrogen is without question. In current energy systems, however, the ramp-up of hydrogen production may cause additional emissions. To avoid this potential adverse effect, recently proposed EU regulation defines strict requirements for electrolytic hydrogen to qualify as green: electrolyzers must run on additional renewable generation, which is produced in a temporally and geographically congruent manner. Focusing on the temporal dimension, this paper argues in favor of a more flexible definition of green hydrogen, which keeps the additionality criterion on a yearly basis but allows for dispatch optimization on a market basis within that period. We develop a model that optimizes dispatch and investment of a wind-hydrogen system—including wind turbines, hydrogen electrolysis, and hydrogen storage—and apply the model to a German case study based on data from 2017-2021. Contrasting different regulatory conditions, we show that a flexible definition of green hydrogen can reduce costs without additional power sector emissions. By contrast, requiring simultaneity implies that a rational investor would build a much larger wind turbine, hydrogen electrolyzer, and hydrogen storage than needed. This leads to additional costs, underutilized resources, and a potential slow-down of green hydrogen deployment. We discuss that current trends in the energy transition are likely to amplify the economic and environmental benefits of a flexible definition of green hydrogen and recommend this as the way forward for a sustainable hydrogen policy. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:258999&r= |
| By: | Afia Malik (Pakistan Institute of Development Economics) |
| Abstract: | NEPRA has approved the detailed design and implementation plan of Competitive Trading Bilateral Contract Market (CTBCM) of electricity, to be implemented in a year. The model envisages that all future contracts for the sale/purchase of electricity will be bilateral between the parties: sellers (generation companies) and buyers (distribution companies or bulk power consumers). |
| Keywords: | Corporate Governance, State-Owned, Electricity, Distribution, Companies |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:pid:kbrief:2021:40&r= |
| By: | Schmitz, Hendrik (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)); Madlener, Reinhard (E.ON Energy Research Center, Future Energy Consumer Needs and Behavior (FCN)) |
| Abstract: | Energy poverty research has received increased attention in the energy economics literature in recent years. We analyze the preferences of low-income renters in the city of Graz, Austria, for different energy retrofitting options. Using data collected from a Discrete Choice Experiment, we find that households are willing to forego significant future energy cost savings in order to avoid investment costs in the present. This can be caused by several factors, including liquidity constraints, a short investment horizon, and myopia among the participants. Furthermore, participants show a significant Willingness to Pay for the reduction of CO2 emissions. We also present simulations for different forms of subsidies for retrofitting and their effects on market shares and emissions. The results have important policy implications regarding the optimal subsidy policies, in particular for low-income households. Specifically, policy makers should focus on reducing the investment burden for liquidity-constrained renters and inducing a longer investment horizon. |
| Keywords: | Energy Poverty; Discrete Choice Modeling; Residential Energy Consumption; Landlord-Tenant Problem |
| JEL: | C35 D12 Q48 Q51 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:ris:fcnwpa:2021_008&r= |
| By: | Westphal, Kirsten; Pastukhova, Maria; Pepe, Jacopo Maria |
| Abstract: | Although electricity grids shape and define both political and economic spaces, the geopolitical significance of electricity remains underestimated. In political communities and beyond, such grids establish new channels for projecting geopolitical influence and new spheres of influence. In the Europe-Asia continental area, integrated electricity grids meet interconnectors - that is, cross-border transmission lines linking different electric grids. Interconnectors define new, partly competing vectors of integration that extend beyond already integrated electricity grids. In this context, it is attractive for non-EU states to belong to the electricity system of continental Europe. This is because interconnected synchronous systems form 'grid communities' that share a 'common destiny' - not only in terms of electricity supply but also in terms of security and welfare. Germany and the EU must develop an electricity foreign policy in order to optimise, modernise, strengthen and expand the European electricity grid. Above all, however, Germany and the EU should help shape interconnectivity beyond the EU's common integrated electricity grid. China is gaining considerable influence in the electricity sector, setting standards and norms as well as expanding its strategic outreach - to the benefit of its own economy. Its efforts are part of Beijing's larger Belt and Road Initiative (BRI), an attempt to reorient global infrastructure and commercial flows. In the EU's eastern neighbourhood, geopolitical issues have dominated the configuration of electricity grids since the end of the Cold War. There is unmistakable competition over integration between the EU and Russia. The eastern Mediterranean region, the Black Sea and Caspian Sea regions, and Central Asia are, each in their own way, changing from peripheral zones into interconnecting spaces. The EU, China, Russia and - across the Black Sea - Iran and Turkey are competing in these zones to influence the reconfiguration of electricity grids. And in South and Southeast Asia, India's influence is on the rise. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:swprps:62022&r= |
| By: | Singh, Tejendra Pratap |
| Abstract: | Air pollution remains one of the most challenging environmental phenomena. Despite its importance in impacting various facets of everyday life, there is a paucity of well-identified air pollution estimates on short-term outcomes for developing countries. Using novel data, I provide detailed empirical evidence on the direct effect of air pollution on student absenteeism in India by linking local exposure to fine particulate matter (PM2.5) to school attendance. I find a large negative effect of increased air pollution on school attendance. My results are robust to a host of specifications and a battery of robustness checks. Consistent with other works, I find that the effect is more pronounced for younger students and find evidence for differential impacts of air pollution on absenteeism by gender. Exploring the mechanisms behind increased absenteeism, I show that reduced school attendance might be resulting from increased incidence of respiratory ailments in the students exposed to air pollution. |
| Date: | 2022–05–11 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:pcva2&r= |
| By: | Cascavilla, Alessandro |
| Abstract: | Given the increasing relevance of sustainability debates, this paper investigates the relationship between the climate change concern and the willingness to pay an environmental tax, considering the interplay with the general level of individual tax morale. By employing a survey among Italian economics students, we show that the climate change concern affects the attitude towards paying an environmental tax both directly and indirectly, via a change in the preferences between the general and the specific tax morale. We find that also tax immoral subjects are significantly willing to pay an environmental tax as their awareness of climate change increases. Given the goal to increase the public acceptance of an environmental tax, we provide three main policy implications: i) carry on campaigns to increase the general level of tax morale, following the guidelines given by the OECD (2019); ii) raise the climate change awareness among people, for instance through investments in sensibilization campaigns on environmental-related topics; iii) increase awareness about climate change in particular among individuals who show lower attitude towards paying taxes. The evidence about an inconsistent tax preference made us recommend a policy addressed to a specific target group rather than to individuals and based on non-monetary incentives, such as nudging and moral suasion tools. |
| Keywords: | Energy survey; Carbon tax; Climate change; Tax evasion and avoidance; Environmental Taxes and Subsidies |
| JEL: | H23 Q40 Q50 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113039&r= |
| By: | Costanza Torricelli; Fabio Ferrari |
| Abstract: | The scope of this paper is to assess the effect 2021 ECB Climate stress test on the stock prices of the banks included in the exercise. To this end, we set up an event study analysis, whereby at the relevant dates we use market data in order to test for the existence of abnormal returns. Three main results emerge from our research. First, on 18.03.2021 investors’ fear arising from the details published about the methodology of the ECB climate stress test and some preliminary evidence had a negative impact on banks stock prices. Second, on the date of publication of the final results on 22.09.21, we find a positive reaction from market participants, since the market possibly expected the banks’ exposure to climate risks to be greater than the one emerging from final results. Third, on the starting date of COP26, an event related to the worldwide consensus on the need to manage climate change, we find a negative effects on banks’ quote that can be explained by the too tiny progresses reached by the summit, which are considered too mild and not adequate to reach the Paris Agreement goals. Finally, robustness tests including small banks not directly supervised by the ECB and banks with a business model not focused on credit intermediation, indicate that the market consider them less exposed to climate risks than larger banks. Our results may have implications in view of future climate stress tests. |
| Keywords: | banks climate stress test; physical risk; transition risk; abnormal returns; event study. |
| JEL: | G14 G28 F55 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:mod:wcefin:0086&r= |
| By: | Florian Bucher; Lucas Scheu; Benedikt Schröpf |
| Abstract: | This study examines the link between economic complexity and environmental quality by exploiting the similar starting points of the former socialist transition countries after the fall of the iron curtain. We refer to the extended theories of the Environmental Kuznets Curve (EKC), stating that environmental pollution follows an inverted u-shaped course with respect to economic complexity. Using comprehensive data of 27 countries for the period 1995-2017, our results show that the EKC can be found for countries whose complexity rose over time. Additionally, since the results for production-based and consumption-based CO2 emissions are similar, we can discard emissions offshoring as a major explaining factor. Consequently, our findings suggest that more complex products are the drivers of the EKC. However, as the turning point is associated with high levels of pollution, our estimates imply that complexity may even exacerbate environmental issues in the short and middle run in less developed countries. |
| Keywords: | Economic Complexity, Environmental Kuznets Curve, Former Socialist States preference transmission |
| JEL: | O44 P28 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:bav:wpaper:218_bucherscheuschroepf&r= |
| By: | Yoshua Bengio; Prateek Gupta; Dylan Radovic; Maarten Scholl; Andrew Williams; Christian Schroeder de Witt; Tianyu Zhang; Yang Zhang |
| Abstract: | Insufficient Social Cost of Carbon (SCC) estimation methods and short-term decision-making horizons have hindered the ability of carbon emitters to properly correct for the negative externalities of climate change, as well as the capacity of nations to balance economic and climate policy. To overcome these limitations, we introduce Retrospective Social Cost of Carbon Updating (ReSCCU), a novel mechanism that corrects for these limitations as empirically measured evidence is collected. To implement ReSCCU in the context of carbon taxation, we propose Retroactive Carbon Pricing (ReCaP), a market mechanism in which polluters offload the payment of ReSCCU adjustments to insurers. To alleviate systematic risks and minimize government involvement, we introduce the Private ReCaP (PReCaP) prediction market, which could see real-world implementation based on the engagement of a few high net-worth individuals or independent institutions. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2205.00666&r= |
| By: | Jung, Heejung; Johnson, Kent; Lopez, Brenda |
| Abstract: | Studies have shown that long-term exposure to ambient air pollution endangers human health. Regulations targeting internal combustion engines have proven effective in reducing their particulate matter (PM) emissions over the years. However, PM from non-tailpipe sources such as brake and tire wear are not currently regulated and are expected to eventually become the dominant source of traffic-related PM emissions. Although studies have produced a greater understanding of brake wear, laboratory tests are an imperfect substitute for real-world activity. Therefore, it is necessary to investigate brake activity for diverse vehicle classes and sizes under in-use conditions. Researchers at the University of California, Riverside aimed to establish a test method to determine brake activity of a heavy-duty vehicle under both dynamometer tests and on-road tests. The results advance the research methodology, ultimately contributing to a more accurate determination of brake activity and informing efforts to improve non-tailpipe PM emissions inventories. This policy brief summarizes the key findings from that research. View the NCST Project Webpage |
| Keywords: | Engineering, Braking, Heavy duty vehicles, Pollutants |
| Date: | 2022–05–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsdav:qt50r6m4dm&r= |
| By: | Simplice A. Asongu; Nicholas M.Odhiambo |
| 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. |
| URL: | http://d.repec.org/n?u=RePEc:afa:wpaper:aesriwp11&r= |
| By: | Rostek, Leon; Thurid Lotz, Meta; Wittig, Sabine; Herbst, Andrea; Loibl, Antonia; Espinoza, Luis Tercero |
| Abstract: | Steel is of extraordinary importance for the European economy as well as society, but is responsible for enormous energy consumption and greenhouse gas emissions. Therefore, steel flows are an obvious subject for the European climate protection. The quantification of steel stocks and flows is useful to be included in discussions regarding Circular Economy, energy system transformation and resource efficiency. Therefore, we developed a retrospective and dynamic material flow model covering the entire European steel and iron cycle from 2002 to 2019. Based on data by Worldsteel and assumptions mainly adopted by Cullen et al. (2012), the value and production chain of steel and iron products is covered by the model. It appears that the European steel and iron use reached a saturation from 2007 on, where the stock of steel in anthropogenic use phase reached around 5,600 Mt. In 2019, around 140 Mt of steel left the use phase, of which circa 6 Mt dissipated or are abandoned in place. Out of the remaining scrap, 110 Mt were collected as secondary raw materials for recycling. Recycling of steel in Europe reached a peak of approx. 140 Mt in 2007, from where on recycling declined equally to overall steel production leading to an almost constant recycling input rate of 57 %. The decline of steel recycling did not significantly affect the collection of steel scrap, but led to an increase of iron and steel scrap export. In 2019, 110 Mt of steel and iron were recycled in Europe, 65 % via EAF, 25 % via BOF and the remaining via ironmaking. Post-consumer waste is by mass more important than new scraps from production and manufacturing as evident in an old scrap ratio of 73 %. Further research could examine the effect of steel scrap prices on their use, further trace these export flows or analyse the potentials of secondary steel production for industry decarbonisation. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:fisisi:s072022&r= |
| By: | Christina Carty (Northwestern University, Weinberg College of Arts & Sciences.); Oscar Claveria (AQR-IREA, Department of Econometrics and Statistics, University of Barcelona, Diagonal 690, 08034 Barcelona, Spain. Tel.: +34-934021825.) |
| Abstract: | We propose a new approach for the visual inspection of interactions between several variables related to the wind and solar energy sector, and a set of socioeconomic variables and natural factors that may be affecting the sector. Focusing on fifteen European countries in the period from 2007 to 2019, we use Categorical Principal Component Analysis to reduce our data into two factors, the first relating to energy consumption, greenhouse gas emissions, per capita income, and solar energy, and the second capturing climactic and sociopolitical factors. The dimensionality reduction also displays a decoupling between natural factors and variable renewable energy sources (VRES) development, particularly in the case of solar energy, and instead shows a more influential relationship with economic factors. We additionally project all countries into a perceptual map and observe three clusters that roughly correspond to the main European regions (Southern and Eastern Europe, Northern Europe and Western Europe). Finally, we plot the average level and growth level of both the wind and solar energy share for each nation and observe a negative relationship in wind share and a slightly positive relationship in solar share. Our results show that, especially for wind energy, countries with higher levels of overall renewable energy development are more likely to show more intense VRES development than countries who already have high existing levels of the technology in their renewable energy mix. Solar energy investment on the other hand is more likely to be dominated by countries with pre-existing high levels of solar in the renewables mix. Our results emphasize the importance of individual nations attitude towards renewables as a whole as playing a key role in VRES development, as much as the natural resource availability of these energies. |
| Keywords: | Renewable energies, Wind share growth, Solar share growth, Economic growth, Human development, Multivariate analysis, Europe. JEL classification: C38, C55, O44, Q20, Q50. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:ira:wpaper:202207&r= |
| By: | Felix Bracht; Dennis Verhoeven |
| Abstract: | Existing estimates of the economic costs of air pollution do not account for its effect on inventive output. Using two weather phenomena as instruments, we estimate this effect in a sample of 1,288 European regions. A decrease in exposure to small particulate matter of 0.17µg/m3 - the average yearly reduction in Europe - leads to 1.7% more patented inventions. After ruling out reallocation of human capital, inventor mortality and R&D expenditures as drivers of the effect, we conclude that air pollution's harm to economic output increases by at least 10% when accounting for innovation. |
| Keywords: | air pollution, air quality, innovation, patent, productivity |
| Date: | 2021–11–26 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1817&r= |
| By: | Dröge, Susanne |
| Abstract: | Im Rahmen des Green Deal erwägt die EU die Einführung eines CO2-Grenzausgleichsmechanismus (CBAM) für Importe, damit sie ihre ehrgeizigen klimapolitischen Ziele erreichen kann, ohne dass energieintensive Sektoren ihre Emissionen ins Ausland verlagern (Carbon Leakage). Der CBAM sieht die virtuelle Anbindung der EU-Handelspartner an das Emissionshandelssystem der EU (EU ETS) vor - und wird von ihnen entsprechend kritisch beurteilt. Denn der CBAM wird ihre Produkte bei der Einfuhr durch Einpreisung der CO2-Kosten verteuern. Um wie viel, wird in dieser Studie für drei Sektoren - Zement, Stahl und Strom - exemplarisch durchgerechnet. Ein CBAM generiert Einnahmen. Der Umgang damit spielt für die WTO-konforme Ausgestaltung eine wichtige Rolle. Davon ist nur dann auszugehen, wenn die Einnahmen konsequent an den Zweck gebunden werden, klimapolitische Maßnahmen im In- und Ausland zu finanzieren. Ein CBAM wirkt als klimapolitischer Hebel. Je mehr Staaten mit der EU in der Klimapolitik zusammenarbeiten, desto geringer wird der Bedarf, das Instrument auch einzusetzen. Ist er erfolgreich, wird der CBAM überflüssig. Damit die klimapolitische Maßnahme handelsrechtlich durchzusetzen ist, muss sie mit den WTO-Regeln in Einklang gebracht werden. Das schließt Sonderregeln für Entwicklungsländer ein. Zudem sollte das Gerechtigkeitsprinzip (CBDR&RC) des UN-Klimaregimes beachtet werden, das den Entwicklungs- und Schwellenländern geringere Beiträge zum Klimaschutz abverlangt als den Industrieländern. Die EU und die Mitgliedstaaten müssen sich darauf einstellen, dass es zu einer Sanktionsdynamik kommen könnte, wenn sie es versäumen, mit ihren Handelspartnern intensive Gespräche zu führen, in denen sie ihr Vorgehen erklären und über Details der Anwendung sowie Ausnahmen verhandeln. Das erfordert Fingerspitzengefühl, Klarheit und ein hohes Maß an Abstimmung mit den Partnerländern. |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:swpstu:92021&r= |
| By: | Christoph Böhringer (University of Oldenburg, Department of Economics); Carolyn Fischer; Nicholas Rivers (University of Ottawa) |
| Abstract: | Carbon pricing policies worldwide are increasingly coupled with direct or indi-rect subsidies where emissions pricing revenues are rebated to the regulated enti-ties. This paper analyzes the incentives created by two novel forms of rebating that reward additional emission intensity reductions: one given in proportion to output (intensity-based output rebating) and another that rebates a share of emission pay-ments (intensity-based emission rebating). These forms are contrasted with output-based rebating, abatement-based rebating, and lump sum rebating. Given the same emission price, intensity-based output rebating incentivizes the most intensity reduc-tions, while abatement-based rebating incentivizes the most output reductions, and output-based rebating puts the least pressure on output (and emissions); intensity-based emissions rebating lies in between these, by implicitly subsidizing emissions while incentivizing intensity reductions. The paper supplements partial equilibrium theoretical analysis with numerical simulations to assess the performance of di?erent mechanisms in a multisector general equilibrium model that accounts for economywide market interactions. |
| Keywords: | Climate change, policy, carbon pricing |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:old:dpaper:439&r= |
| By: | Gourdel, Régis; Monasterolo, Irene; Dunz, Nepomuk; Mazzocchetti, Andrea; Parisi, Laura |
| Abstract: | The analysis of the conditions under which, and extent to which climate-adjusted financial risk assessment affects firms’ investment decisions in the low-carbon transition, and the realisation of the climate mitigation trajectories, still represent a knowledge gap. Filling this gap is crucial to assess the “double materiality” of climate-related financial risks. By tailoring the EIRIN Stock-Flow Consistent model, we provide a dynamic balance sheets assessment of climate physical and transition risks for the euro area, using the climate scenarios of the Network for Greening the Financial System (NGFS). We find that an orderly transition achieves important co-benefits already in the mid-term, with respect to carbon emissions abatement, financial stability, and economic output. In contrast, a disorderly transition can harm financial stability, thus limiting firms’ capacity to invest in low-carbon activities that could decrease their exposure to transition risk and help them recover from climate physical shocks. Importantly, investors’ climate sentiments, i.e. their anticipation of the impact of the carbon tax across NGFS scenarios, play a key role for smoothing the transition in the economy and finance. Our results highlight the importance for financial supervisors to consider the role of firms and investors’ expectations in the low-carbon transition, in order to design appropriate macro-prudential policies for tackling climate risks. JEL Classification: B59, Q50 |
| Keywords: | climate physical risk, climate transition risk, double materiality, Network for Greening the Financial System scenarios, Stock-Flow Consistent model |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20222665&r= |
| By: | Sun, Maoran; Han, Changyu; Nie, Quan; Xu, Jingying; Zhang, Fan; Zhao, Qunshan |
| Abstract: | With buildings consuming nearly 40% of energy in developed countries, it is important to accurately estimate and understand the building energy efficiency in a city. In this research, we propose a deep learning-based multi-source data fusion framework to estimate building energy efficiency. We consider the traditional factors associated with the building energy efficiency from the energy performance certificate for 160,000 properties (30,000 buildings) in Glasgow, UK (e.g., property structural attributes and morphological attributes), as well as the Google Street View (GSV) building façade images as a complement. We compare the performance improvements between our data-fusion framework with traditional morphological attributes and image-only models. The results show that including the building façade images from GSV, the overall model accuracy increases from 79.7% to 86.8%. A further investigation and explanation of the deep learning model are conducted to understand the relationships between building features and building energy efficiency by using Shapley Additive explanations (SHAP). Our research demonstrates the potential of using multi-source data in building energy efficiency prediction to help understand building energy efficiency at the city level to help achieve the net-zero target by 2050. |
| Date: | 2022–05–04 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:g8p4f&r= |
| By: | Ujjayant Chakravorty; Martino Pelli; Ridhima Gupta |
| Abstract: | Pollution from the use of fuels like fuelwood and crop residue is a huge environmental issue in developing countries. It leads to poor indoor air quality and adverse impacts on human health, mainly that of women and children who spend most of their time indoors. It also leads to deforestation in areas where fuelwood and charcoal use is high. This chapter describes the problem of fuel use for cooking in developing economies, and the challenges they pose for human health and the environment. The findings from many economic studies are analysed on different aspects of this issue, evaluations of government policies and the difficulties associated with the desired transition to cleaner, more efficient fuels such as natural gas and electricity. To quote this document: Chakravorty U., Gupta R. and Pelli M. (2022). The economics of rural energy use in developing countries (2022s-12, CIRANO). https://doi.org/10.54932/XCOZ6579 La pollution due à l'utilisation de combustibles tels que le bois de chauffage et les résidus de récolte est un problème environnemental majeur dans les pays en développement. Elle entraîne une mauvaise qualité de l'air intérieur et a des effets néfastes sur la santé humaine, principalement celle des femmes et des enfants qui passent la plupart de leur temps à l'intérieur. Elle conduit également à la déforestation dans les zones où l'utilisation de bois de chauffage et de charbon de bois est élevée. Ce chapitre décrit le problème de l'utilisation de combustibles pour la cuisson dans les économies en développement, et les défis qu'ils posent pour la santé humaine et l'environnement. Les conclusions de nombreuses études économiques sont analysées sur différents aspects de cette question, les évaluations des politiques gouvernementales et les difficultés liées à la transition souhaitée vers des combustibles plus propres et plus efficaces tels que le gaz naturel et l'électricité. Pour citer ce document: Chakravorty U., Gupta R. and Pelli M. (2022). The economics of rural energy use in developing countries (2022s-12, CIRANO). https://doi.org/10.54932/XCOZ6579 |
| Keywords: | Cooking fuels,air pollution,indoor air quality,fuelwood markets,clean energy, Combustibles de cuisson,pollution atmosphérique,qualité de l'air intérieur,marchés du bois de chauffage,énergie propre |
| JEL: | O13 Q42 Q53 |
| Date: | 2022–05–25 |
| URL: | http://d.repec.org/n?u=RePEc:cir:cirwor:2022s-12&r= |
| By: | Jane Ellis (OECD); Luca Lo Re (International Energy Agency); Federico De Lorenzo (OECD) |
| Abstract: | Greenhouse gas (GHG) mitigation actions will need to be accelerated and scaled up at both national and sub-national levels in order to meet the temperature goals of the Paris Agreement. National governments can play an important role in enabling GHG mitigation actions by non-Party stakeholders (NPS), and in enhancing the interaction between national policies and NPS actions. This paper explores actions national governments could take to facilitate NPS mitigation action in two sub-sectors with large mitigation potential and where NPS play a key role in the successful implementation of mitigation activities. These sectors are renewable electricity generation and procurement in cities and Reducing Emissions from Deforestation and forest Degradation in sub-national jurisdictions. This paper outlines some institutional, regulatory, financial and technical barriers faced by NPS in implementing GHG mitigation activities in these sub-sectors and highlights some examples of national policies and measures that have allowed specific NPS to overcome these barriers. The paper also showcases examples of enabling policy frameworks at the national level that could encourage the replication of such mitigation actions by NPS. An important, common element for successful replication of mitigation activities is for national governments to facilitate co-ordination with NPS; to improve consistency between national and sub-national policies; to identify and clarify responsibilities between different actors; and to regularly review and potentially revise national policies that may unintentionally create barriers to NPS mitigation actions. |
| Keywords: | climate change, mitigation, non-party stakeholders, REDD+, renewable electricity |
| JEL: | H70 K32 O13 Q15 Q28 Q54 |
| Date: | 2022–05–31 |
| URL: | http://d.repec.org/n?u=RePEc:oec:envaab:2022/02-en&r= |
| By: | Pavel Ciaian; Andrej Cupak; Pirmin Fessler; d'Artis Kancs |
| Abstract: | Individuals invest in ESG-assets not only because of higher expected returns but also for ethical and social considerations. Controversies surrounding the ESG footprint of crypto-assets – mainly on grounds of the energy-intensive crypto mining and their use for illegal activities – offer an interesting object of inquiry. Leveraging a unique representative survey for the Austrian population, we examine whether investors’ ESG preferences can explain cross-sectional differences in individual portfolio exposure to crypto-assets. While we find no statistically significant relationship between ESG concerns of investors and the probability of holding bonds or shares, in contrast, we find a strong association between investors’ ESG preferences and crypto-investment exposure. |
| Keywords: | Crypto-assets; financial behaviour; environmental-social-governance preferences. |
| JEL: | D14 G11 G41 |
| Date: | 2022–03–07 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2022_07&r= |
| By: | Confidence Duku; Carlos Alho; Rik Leemans; Annemarie Groot |
| Abstract: | This article reviews how food system activities contribute to climate change and how dietary changes affect food systems. It shows that while emissions from food production are increasing in most regions, emissions from land use change are decreasing. Despite these trends, land use emissions remain huge and are greater than emissions from food production in some regions. While there is strong scientific consensus that climate change negatively affects food production, current scientific evidence is unclear about the impacts of climate change on post-production activities. This article also shows that dietary change has large potential to reduce greenhouse gas emissions. Despite its potential, the costs and feasibility of dietary change are not well understood and require further research. Strategies to reduce emissions should focus on further reducing land use change as the current rate of reduction is inadequate to achieve a targeted reduction in greenhouse gas emissions. Strategies must also address meat consumption in regions where it consumption is excessive. |
| Keywords: | Agricultural and Food Policy |
| Date: | 2022–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:ags:unadrs:320722&r= |
| By: | Javier L\'opez Prol; Karl W. Steininger; Keith Williges; Wolf D. Grossmann; Iris Grossmann |
| Abstract: | Electrification of all economic sectors and solar photovoltaics (PV) becoming the lowest-cost electricity generation technology in ever more regions give rise to new potential gains of trade. We develop a stylized analytical model to minimize unit energy cost in autarky, open it to different trade configurations, and evaluate it empirically. We identify large potential gains from interhemispheric and global electricity trade by combining complementary seasonal and diurnal cycles. The corresponding high willingness to pay for large-scale transmission suggests far-reaching political economy and regulatory implications. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2205.01436&r= |
| By: | Daniele Valenti (Fondazione Eni Enrico Mattei and Department of Environmental Science and Policy, University of Milan); Andrea Bastianin (Department of Economics, Management and Quantitative Methods, University of Milan and Fondazione Eni Enrico Mattei); Matteo Manera (Departments of Economics, Management and Statistics, University of Milan-Bicocca and Fondazione Eni Enrico Mattei) |
| Abstract: | We present a weekly structural Vector Autoregressive (VAR) model of the US crude oil market. Exploiting weekly data we can explain short-run crude oil price dynamics, including those related with the COVID-19 pandemic and with the Russia’s invasion of Ukraine. The model is set identified with a Bayesian approach that allows to impose restrictions directly on structural parameters of interest, such as supply and demand elasticises. Our model incorporates both the futures-spot price spread to capture shocks to the real price of crude oil driven by changes in expectations and US inventories to describe price fluctuations due to unexpected of variations of above-ground stocks. Including the futures-spot price spread is key for accounting for feedback effects from the financial to the physical market for crude oil and for identifying a new structural shock that we label expectational shock. This shock plays a crucial role when describing the series of events that have led to the spike in the price of crude oil recorded in the aftermath of Russia’s invasion of Ukraine. |
| Keywords: | COVID-19; WTI price; futures-spot price spread; speculation; structural VAR; Bayesian VAR |
| JEL: | C32 Q02 Q41 Q43 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2022.11&r= |
| By: | Karel Janda; Anna Kortusova; Binyi Zhang |
| Abstract: | Green bonds have gained prominence in China’s capital market as tools that help to fuel the transition to a climate-resilient economy. Although the issuance volume in the Chinese green bond market has been growing rapidly in recent years, the impact of the green label on bond pricing has not been adequately studied. Therefore, this paper investigates whether the newly developed financial instrument offers investors in China an attractive yield compared to other equivalent conventional bonds. By matching green bonds with their conventional counterparts and subsequently applying a fixed-effects estimation, our empirical results reveal a significant negative green bond yield premium of -1.8 bps on average in the Chinese secondary market. In addition, the yield premium is found to vary across issuers’ business sectors mainly due to the public reputation of bond issuers. Moreover, our empirical results reveal an insignificant relationship between the green certification and the yield premium, possibly reflecting inconsistent green bond standards in the Chinese market. Our results point to some practical implications for policymakers and investors. |
| Keywords: | Green Finance, Green bonds, ESG, China |
| JEL: | G12 Q56 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2022-38&r= |
| By: | Wang, Guihua; Fulton, Lewis; Miller, Marshall |
| Abstract: | This project aims to assess the current and future performance and costs of battery electric trucking, through reviewing key recent studies in the U.S. and presenting a detailed comparison of their cost modeling scope and coverage. This white paper presents a review of 10 recent studies of the total cost of ownership (TCO) of battery electric trucks (BET), now and in the future, compared to a baseline diesel truck, for the following 3 important types of truck: heavy-duty long-haul trucks, medium-duty delivery trucks, and heavy-duty drayage/short-haul trucks. The researchers break down the studies into their estimates for a range of important cost and operating factors, such as vehicle purchase cost, efficiency, fuel cost, maintenance cost, required range and thus battery pack sizing, and other factors. Of note are differences in major assumptions of studies and variables that are included or excluded from consideration. The authors do not judge these studies against each other but attempt to derive general findings that are robust across studies, areas of significant difference, and areas for further research. Overall, TCO estimates across the studies, for a given truck type, can vary dramatically, though often several studies cluster together. But as this study explores, the differences in TCO link directly to differences in assumptions, parameters and other differences across the studies. The studies vary in important ways that should be taken into account when comparing TCO estimates. Policy makers should consider the context of truck type, truck use and other factors when reading such studies, and pay attention to assumptions. Policies should reflect the wide range of situations that trucks may encounter and avoid assuming a simple average TCO across all situations. View the NCST Project Webpage |
| Keywords: | Business, Engineering, Battery Electric Trucks, Total Cost of Ownership (TCO), Medium and Heavy Duty Trucks, Battery Cost, Zero Emission Vehicles |
| Date: | 2022–06–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsdav:qt8zj9462h&r= |
| By: | Simplice A. Asongu (Yaounde, Cameroon); Gerald Emmanuel Arhin (University of Manchester, UK); Abdul-Gafaru Abdulai (University of Ghana Business School, Legon.); Justice Bawole (University of Ghana Business School, Legon.) |
| Abstract: | This chapter surveys the literature on the political-economy of oil and gas governance by focusing on the exploration, production and revenue sharing in the hydrocarbon sector. Emphasis is placed on the extent to which oil and gas governance is shaped by geopolitics and interparty-party politics. We argue that the interests and ideas relative to the power of key stakeholders, such as political actors, multinational companies, the citizens and the state are relevant to the understanding of the form and shape of the emergence and performance of the institutions governing the oil and gas sectors of emerging and developing countries. |
| Keywords: | Political economy, oil and gas; development economies; inter-party politics; geopolitics; institutions; interests; ideas; power |
| JEL: | D72 H23 H77 P16 P48 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:exs:wpaper:22/029&r= |
| By: | Weshah A. Razzak |
| Abstract: | Evidence-based policy of global warming is best relying on a relevant sample of data. We choose a sample of annual data from 1959 to-date to provide some statistically robust stylized facts about the relationships between actual CO2 and temperature. Visually, there is a clear upward trend in both data. Time series analyses suggest that CO2 is difference-stationary and temperature is trend-stationary. Thus, the moments (mean, variance, etc.) of the data in levels are functions of time, which means that the correlation between the two variables may be spurious. Most importantly is that the variance of CO2 (and all greenhouse gases) are significantly smaller than the variance of temperature, hence they cannot explain the variations in temperature. We find no statistically robust evidence of correlation, long run co-variation, long run common trend, or common cycles between CO2 and temperature over a period of 60 years. Nonetheless, at most 40 percent of the variance of the Northern Hemisphere temperature is due to , 20 percent of the Southern Hemisphere, and much less of global temperature. |
| Keywords: | Econometrics of unit root, trend, cycle, VAR, temperature, global warming, CO2, greenhouse gasses, fossil fuel consumption. |
| JEL: | C01 C22 C3 Q54 |
| Date: | 2022–03–06 |
| URL: | http://d.repec.org/n?u=RePEc:eei:rpaper:eeri_rp_2022_06&r= |
| By: | Raphael Calel; Jonathan Colmer; Antoine Dechezleprêtre; Matthieu Glachant |
| Abstract: | We develop and implement a new method for identifying wasted subsidies, and use it to provide systematic evidence on the misallocation of carbon offsets in the Clean Development Mechanism - the world's largest carbon offset program. Using newly constructed data on the locations and characteristics of 1,350 wind farms in India - a context where it was believed, ex-ante, that the Clean Development Mechanism could significantly increase development above baseline projections - we estimate that at least 52% of approved carbon offsets were allocated to projects that would very likely have been built anyway. In addition to wasting scarce resources, we estimate that the sale of these offsets to regulated polluters has substantially increased global carbon dioxide emissions. |
| Keywords: | carbon offsets, infra-marginal support, misallocation, investment, subsidies, wind power, Green Growth |
| Date: | 2021–10–29 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1808&r= |
| By: | Mike Ludkovski; Glen Swindle; Eric Grannan |
| Abstract: | We develop a probabilistic framework for joint simulation of short-term electricity generation from renewable assets. In this paper we describe a method for producing hourly day-ahead scenarios of generated power at grid-scale across hundreds of assets. These scenarios are conditional on specified forecasts and yield a full uncertainty quantification both at the marginal asset-level and across asset collections. Our simulation pipeline first applies asset calibration to normalize hourly, daily and seasonal generation profiles, and to Gaussianize the forecast--actuals distribution. We then develop a novel clustering approach to stably estimate the covariance matrix across assets; clustering is done hierarchically to achieve scalability. An extended case study using an ERCOT-like system with nearly 500 solar and wind farms is used for illustration. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2205.04736&r= |
| By: | Luis E. Gonzales; Koichiro Ito; Mar Reguant |
| Abstract: | Effective and economical expansion of renewable energy is one of the most urgent and important challenges of addressing climate change. However, many countries are facing a problem because existing network infrastructures (i.e., transmission networks) were not originally built to accommodate renewables, which creates disconnections between demand centers and renewable supply. In this paper, we study the static and dynamic impacts of market integration on renewable energy expansion. Our theory highlights that statically, market integration improves allocative efficiency by gains from trade, and dynamically, it incentivizes new entry of renewable power plants. Using two recent grid expansions in the Chilean electricity market, we empirically test our theoretical predictions and show that commonly-used event study estimation underestimates the dynamic benefits if renewable investments occur in anticipation of market integration. We build a structural model of power plant entry and show how to correct for such bias. We find that market integration resulted in price convergence across regions, increases in renewable generation, and decreases in generation cost and pollution emissions. Furthermore, a substantial amount of renewable entry would not have occurred in the absence of market integration. We show that ignoring this dynamic effect would substantially understate the benefits of transmission investments. |
| JEL: | L94 L97 Q41 Q42 Q53 Q56 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30016&r= |
| By: | Hailemariam, Abebe |
| Abstract: | This paper examines the effect of national income on the total fertility rate (children born per woman). We estimate the effects on fertility of shocks to national per capita income using plausibly exogenous variations in oil price shock as an instrument for income and using instrumental variable generalized quantile regressions (IV-GQR). Using data for a panel of 122 countries spanning the period 1965-2020, our results show that national per capita income has has generally a negative and significant effect on the total fertility rate. Looking at the entire spectrum of the fertility distribution, the IVGQR estimates exhibit considerable heterogeneity in the impact of income on fertility. The income elasticity of fertility is relatively low at the upper tail of the distribution (for countries with high fertility) compared to the value at the median. |
| Keywords: | national income,differential fertility,mortality,oil price shock,instrumental variable generalized quantile regressions |
| JEL: | J11 J13 O11 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:glodps:1089&r= |
| By: | Sachiko Miyata (Ritsumeikan University); Yasuyuki Sawada (Faculty of Economics, The University of Tokyo); Kazuma Takakura (Graduate School of Economics, The University of Tokyo) |
| Abstract: | This paper investigates a new technology’s long-term processes of adoption, standardization, and decline. Specifically, we examine the decision to invest in floating net aquaculture, introduced as a social safeguard program for poor Indonesian households that were involuntarily resettled because of a dam/reservoir construction project. We find the program helped transform and sustain the livelihood of resettlers by facilitating the adoption of this new technology. We also find behavioral irreversibility in technology adoption, resulting in overfishing in the reservoir. Considering the increasing importance of hydropower and renewable energy sources, this innovative resettlement program provides critical policy insight. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:tky:fseres:2022cf1193&r= |
| By: | Raouf Boucekkine (Rennes School of Business, France); Weihua Ruan (Purdue University Northwest, USA); Benteng Zou (DEM, University of Luxembourg) |
| Abstract: | We study a 2-country differential game with irreversible pollution. Irreversibility is of a hard type: above a certain threshold level of pollution, the self-cleaning capacity of Nature drops to zero. Accordingly, the game includes a non-concave feature, and we characterize both the cooperative and non-cooperative versions with this general non-LQ property. We deliver full analytical results for the existence of Markov Perfect Equilibria. We first demonstrate that when pollution costs are equal across players (symmetry), irreversible pollution regimes are more frequently reached than under cooperation. Second, we study the implications of asymmetry in the pollution cost. We find far nontrivial results on the reachability of the irreversible regime. However, we unambiguously prove that, for the same total cost of pollution, provided the irreversible regime is reached in both the symmetric and asymmetric cases, long-term pollution is larger in the symmetric case, reflecting more intensive free-riding under symmetry. |
| Keywords: | Differential games, Irreversible pollution, Non-concave pollution decay, Asymmetric pollution cost, Markov Perfect Equilibria |
| JEL: | C72 C61 Q53 |
| Date: | 2022–05–13 |
| URL: | http://d.repec.org/n?u=RePEc:ctl:louvir:2022012&r= |
| By: | Adha, Rishan; Hong, Cheng-Yih; Agrawal, Somya; Li, Li-Hua |
| Abstract: | The global rise in energy consumption makes managing energy demands a priority. Here, the potential of Information and Communication Technology (ICT) in controlling energy consumption is still debated. Within this context, the main objective of the current study is to measure the impact of ICT, its potential benefit, and environmental factors on household electricity demand in Taiwan. A panel of data from 20 cities in Taiwan was collected during the period 2004-2018. We adopted PMG estimation and applied the DH-causality test for analysis. The estimation results show that ICT, carbon emissions, and climate change will drive household electricity demand in Taiwan in the long term. However, ICT has a higher potential to reduce electricity demand in the short-term period. In addition, the results of the causality test reveal a two-way interrelationship between ICT and electricity demand. Our study also found that climate change indirectly affects the use of electricity through household appliances. We also presented several policy implications at the end of this paper. |
| Keywords: | energy demand, ICT, carbon emissions, climate change, dynamic panel data model |
| JEL: | C3 C33 Q4 Q43 |
| Date: | 2021–10–26 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113009&r= |
| By: | Erica Marujo; Nuno Goncalves; Rui Dias |
| Abstract: | The response to climate change will demand profound transformations in social and economic systems, requiring significant investments from both the public budget and the private sector. This occasional paper contextualizes the issue of climate change in the Portuguese economy and analyses its effects on public finances. This document explains the main concepts underlying climate change and analyses the main theoretical transmission channels to the economy. The empirical evidence for Portugal regarding this issue is reviewed and the policies and financial instruments already adopted in the country to ensure the decarbonization of the economy until 2050 are surveyed. A detailed analysis of the financial dimension of the climate action for Portugal is presented, aiming to clarify the financing strategy of the country to reach carbon neutrality and the allocation of the financial effort to be executed between the public and the private sectors. This study concludes that, in Portugal, despite the approval of several climate action plans, there is a clear need for better articulation between the multiple instruments and to develop their financial dimension in order to ensure greater transparency of the inherent processes and to secure the achievement of the agreed targets. The impact of climate change over the economic growth and other dimensions of the society will be greater the less action taken by policy makers to adopt mitigation and adaptation measures that fulfil the goals of the Paris Agreement. |
| Keywords: | Climate change; macroeconomic impacts; decarbonization; public investment; public financing; budgetary impact |
| JEL: | E60 H23 O44 Q51 Q54 Q58 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:alf:opaper:2022-03&r= |
| By: | Ary Júnior |
| Abstract: | This paper explores the effects of income inequality on the relationship between environmental attitudes and life satisfaction across 27 European countries. Furthermore, it assesses the influence of the European Union on their citizens’ behavior regarding the link between environmental attitudes and happiness. Using data from European Values Study, it applies an ordered probit model. The findings suggest that subjective and objective income inequality do not change the relationship between environmental attitudes and welfare, providing evidence of the “commitment effect”. The results also show similar performance of the relationship between environmental attitudes and well-being between EU-members and non-EU members. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:ise:remwps:wp02292022&r= |
| By: | Rigolini, Jamele (World Bank) |
| Abstract: | This paper reviews the role of Social Protection and Labor in supporting both climate adaptation and mitigation efforts. The Climate Crisis is impacting the poor and vulnerable disproportionally, both as a consequence of climate shocks and through the distributional impacts of climate mitigation policies. The paper discusses how – even without explicit environmental objectives – Social Protection and Labor strengthens resilience against climate shocks. However, integrating crisis-sensitive elements into social protection and labor programs increases substantially their ability to respond to shocks. Social protection and labor programs also facilitate green and Just Transitions by supporting equitable policies and can ease transitions towards Green jobs. Finally, Social protection and labor programs can also directly support mitigation measures by positively affecting behaviors. While investments in climate-related Social Protection and Labor are rapidly expanding, its full potential to support adaptation, decarbonization and mitigation is still to be realized. |
| Keywords: | social protection, climate change, adaptation, mitigation |
| JEL: | I38 Q54 |
| Date: | 2022–06 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izapps:pp184&r= |
| By: | Hlongwane, Nyiko Worship |
| Abstract: | The study examines the relationship between oil prices and exchange rates in South Africa for the period from 1970 to 2021. There is a problem of high oil prices and weak exchange rate of the South African Rand to the US Dollar. The study utilised annual time series data collected from the South African Reserve Bank. The study employed an ARDL model and performed Granger Causality test to analyse the relationships between the variables. The study found that there is a negative relationship between oil prices and exchange rates in South Africa. The study further revealed that there is a noncausality between oil prices and exchange rates in South Africa. The study therefore recommends that policies that reduce oil prices must be implemented to safeguard the value of the South African Rand against the US Dollar. |
| Keywords: | Oil prices, exchange rate, ARDL, SARB, South Africa |
| JEL: | F19 F62 G12 |
| Date: | 2022–03–20 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:113209&r= |
| By: | Koen van Ruijven (CPB Netherlands Bureau for Economic Policy Analysis); Joep Tijm (CPB Netherlands Bureau for Economic Policy Analysis) |
| Abstract: | We find strong associations between house prices and environmental factors that are directly noticeable. This mainly concerns noise pollution and the amount of greenery and water in close proximity to a house. The strong negative associations for noise are mainly found in low levels (below 40 dB) and at high levels (above 65 dB). We find positive effects up to 200 meters for the presence of greenery and water. After 200 meters we find no, or only a small negative association with house prices. Surprisingly, air pollution is only weakly related to housing prices. These results follow from research in which we relate house prices to this set of environmental factors. We find the strongest price effects for greenery and water within 50 meters of a house. In particular, the price relationship for greenery decreases the further away the greenery is from a house. For example, we see that a 10% increase in the percentage of grass and shrubs (trees) within 50 meters is associated with a 1% to 4% (1% to 3%) increase in house prices. For water, we find that a comparable 10% increase is associated with a 0.5% to 1.5% increase in house prices. Our results have important policy implications, as they suggest that households have a limited willingness to pay for environmental goods that they do not directly notice. This result is especially relevant for air pollution. Recent studies indicate that health costs are significantly higher than our estimates of what households seem willing to pay for better air quality. This suggests that households are not fully aware of the effects of local air pollution on their health when purchasing their home. |
| JEL: | Q51 Q53 |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:cpb:discus:438&r= |
| By: | Jan Fagerberg (Centre for Technology, Innovation and Culture, University of Oslo); Håkon Endresen Normann (The Nordic Institute for Studies of Innovation, Research and Education (NIFU)) |
| Abstract: | This paper addresses the role of innovation policy, including regulation, in the transition to a society characterized by net zero emissions of climate gasses. A broad range of policy-actors, notably the European Union, have already publicly embraced this goal. Nevertheless, transforming the society to a state consistent with the net-zero objective is a very demanding task, and to succeed in this endeavour extensive change – including a lot of innovation - in the way energy is provided, distributed and used across all parts of society will be needed. A crucial question, therefore, is how policy – and particularly innovation policy – can contribute to mobilize innovation for this purpose. This paper critically examines the extant literature on the subject, and discusses examples of transformational change from policy practice, including onshore wind and solar in Denmark and Germany; offshore wind in the UK, Denmark and Norway; and the emerging quest for zero-emission ships. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:tik:inowpp:20220531&r= |