nep-ene New Economics Papers
on Energy Economics
Issue of 2022‒10‒03
43 papers chosen by
Roger Fouquet
London School of Economics

  1. Green Road is Open: Economic Pathway with a Carbon Price Escalator By Lucas Bretschger
  2. Renewable Energy in the Russian Arctic: Energy Transition and Opportunities in the Context of Post-pandemic Realities By Valentina Ignatyeva; Sébastien Gadal
  3. Retrospective User Survey for a Rural Electric Vehicle Carsharing Pilot in California’s Central Valley By Harold, Brian MBA; Rodier, Caroline PhD; Zhang, Yunwan MS
  4. A nation-wide experiment: fuel tax cuts and almost free public transport for three months in Germany -- Report 3 Second wave results By Allister Loder; Fabienne Cantner; Andrea Cadavid; Markus B. Siewert; Stefan Wurster; Sebastian Goerg; Klaus Bogenberger
  5. Energy price shocks and stabilization policies in a multi-agent macroeconomic model for the Euro Area By Turco, Enrico; Bazzana, Davide; Rizzati, Massimiliano; Ciola, Emanuele; Vergalli, Sergio
  6. Nudges and peak pricing: A common pool resource energy conservation experiment By Penelope Buckley; Daniel Llerena
  7. International Trade and the Environment: Three Remaining Empirical Challenges* By Jevan Cherniwchan; M.Scott Taylor
  8. Renewable, Non-renewable Energy Consumption and Economic Growth Nexus in G7: Fresh Evidence from CS-ARDL By Okumus, İlyas; Guzel, Arif Eser; Destek, Mehmet Akif
  9. The Impact of Natural resources, CO2 Emission, Energy use, Domestic Investment, Innovation, Trade and Digitalization on Economic growth: Evidence from 52 African Countries By Bakari, Sayef
  10. The Financial Side of Energy Markets in the Low-Carbon Transition By Liebrich M. HIEMSTRA
  11. The systemic risk of US oil and natural gas companies By Caporin, Massimiliano; Fontini, Fulvio; Panzica, Roberto
  12. Accounting for climate transition risk in banks' capital requirements By Alessi, Lucia; Di Girolamo, Francesca Erica; Pagano, Andrea; Petracco Giudici, Marco
  13. Optimal Timing of Carbon Capture and Storage Policies - a Social Planner's View By Yiwen Chen; Xi Wan; Benteng Zou
  14. Carbon dioxide removal as an integral building block of the European Green Deal By Schenuit, Felix; Böttcher, Miranda; Geden, Oliver
  15. The Impact of the European Carbon Market on Firm Productivity: Evidence from Italian Manufacturing Firms By D’Arcangelo, Filippo Maria; Pavan, Giulia; Calligaris, Sara
  16. Anatomy of Green Specialisation: Evidence from EU Production Data, 1995-2015 By Bontadini, Filippo; Vona, Francesco
  17. CO2-Entnahme als integraler Baustein des europäischen "Green Deal" By Schenuit, Felix; Böttcher, Miranda; Geden, Oliver
  18. Growth impact of climate change and response policies: The advanced climate change long-term (ACCL) model By Claire Alestra; Gilbert Cette; Valérie Chouard; Rémy Lecat
  19. The hydrogen ambitions of the Gulf States: Achieving economic diversification while maintaining power By Ansari, Dawud
  21. Nowcasting industrial production using linear and non-linear models of electricity demand By Giulio Galdi; Roberto Casarin; Davide Ferrari; Carlo Fezzi; Francesco Ravazzolo
  22. Could the environment be a normal good for you and an inferior good for me? A theory of context-dependent substitutability and needs By Marion Dupoux; Vincent Martinet
  23. 800,000 Years of Climate Risk By Tobias Adrian; Nina Boyarchenko; Domenico Giannone; Ananthakrishnan Prasad; Dulani Seneviratne; Yanzhe Xiao
  24. A sustainability transition on the move? Evidence based on the disconnect from market fundamentals By Alessi, Lucia; Hirschbuhl, Dominik; Rossi, Alessandro
  25. Decarbonising Europe’s Trucks: How to Minimise Cost Uncertainty By ITF
  26. Cuentas ambientales para la formulación e implementación de la política climática By Pizarro Gariazzo, Rodrigo
  27. Evaluating Climate Policies by the Pareto Principle: Efficiency When Future Identities Are Unobservable By Geir B. Asheim; Kohei Kamaga; Stéphane Zuber
  28. “Green†fiscal policy measures and non-standard monetary policy in the euro area By Anna Bartocci; Alessandro Notarpietro; Massimiliano Pisani
  29. The Gulf Cooperation Council and the Circular Carbon Economy: Progress and Potential By Mari Luomi; Fatih Yilmaz; Thamir Alshehri
  30. Environmental and Social Preferences and Investments in Crypto-Assets By Pavel Ciaian; Andrej Cupák; Pirmin Fessler; d’Artis Kancs
  31. Discrepancies in corporate GHG emissions data and their impact on firm performance assessment By : Papadopoulos, Georgios
  32. "A dynamic programming approach to optimal pollution control under uncertain irreversibility: The Poisson case" By Raouf Boucekkine; Carmen Camacho; Weihua Ruan; Benteng Zou
  33. Macroeconomic Implications of Oil-Price Shocks to Emerging Economies: A Markov Regime-Switching Approach By Sophio Togonidze; Evzen Kocenda
  34. Different Shades of Green: Estimating the Green Bond Premium using Natural Language Processing By Emanuela Benincasa; Jonathan Fu; Mrinal Mishra; Adityavardhan Paranjape
  35. Quantifying the Role of Interest Rates, the Dollar and Covid in Oil Prices By Emanuel Kohlscheen
  36. Modeling Volatility and Dependence of European Carbon and Energy Prices By Jonathan Berrisch; Sven Pappert; Florian Ziel; Antonia Arsova
  37. A weekly structural VAR model of the US crude oil market By Valenti, Daniele; Bastianin, Andrea; Manera, Matteo
  38. Steuerbegünstigungen für Gas in Zeiten von Gasmangel By Fremerey, Melinda; Gerards Iglesias, Simon
  39. Turkey and European energy (in)security: What role for Turkey in European energy security following the Russian invasion of Ukraine? By Tastan, Kadri
  40. Keeping the Nuclear Energy Option Open By Noura Mansouri Robert J. Budnitz H-Holger Rogner Charles McCombie Robert N. Schock Adnan Shihab-Eldin; Robert J. Budnitz H-Holger Rogner Charles McCombie Robert N. Schock Adnan Shihab-Eldin; H-Holger Rogner Charles McCombie Robert N. Schock Adnan Shihab-Eldin; Charles McCombie Robert N. Schock Adnan Shihab-Eldin; Robert N. Schock Adnan Shihab-Eldin; Adnan Shihab-Eldin
  41. Asymmetry and Interdependence when Evaluating U.S. Energy Information Agency Forecasts By Garratt, Anthony; Petrella, Ivan; Zhang, Yunyi
  42. Job Displacement Costs of Phasing Out Coal By Juan-Pablo Rud; Michael Simmons; Gerhard Toews; Fernando Aragon
  43. One Year After the Texas Blackout: Lessons for Reliable and Resilient Power Systems By Marie Petitet; Frank Felder; Khalid Alhadhrami

  1. By: Lucas Bretschger (CER-ETH – Center of Economic Research at ETH Zurich, Zuerichbergstrasse 18 8092 Zurich, Switzerland)
    Abstract: The paper develops the concept of "Economic Pathways" (EPs), which characterize theory-based scenarios for an economy that strives to achieve decarbonization by mid-century. The theoretical framework derives closed-from analytical solutions for consumption, innovation, emissions, and population. The EPs differ in the stringency of assumed policies and associated income and emission development. Unlike the well-known "Shared Socioeconomic Pathways", they allow important causalities between the economy and the environment to be included and significantly narrow the scope of likely future developments. The quantitative part serves to illustrate the long-term consequences of climate policy. I show that deep decarbonization only moderately delays economic development, but requires increasing escalation of the carbon price. Subsidies to the research sector support income development significantly. The paper argues that the adoption of more stringent climate policies becomes more likely as the phase-out of fossil fuels increases. The "Green Road" is not only feasible, but also attractive and realistic.
    Keywords: Climate policies, consumption growth, population growth, endogenous innovation, economic pathways
    JEL: Q43 O47 Q56 O41
    Date: 2022–09
  2. By: Valentina Ignatyeva (ESPACE - Études des Structures, des Processus d’Adaptation et des Changements de l’Espace - UNS - Université Nice Sophia Antipolis (1965 - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015-2019) - AU - Avignon Université - AMU - Aix Marseille Université - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur); Sébastien Gadal (ESPACE - Études des Structures, des Processus d’Adaptation et des Changements de l’Espace - UNS - Université Nice Sophia Antipolis (1965 - 2019) - COMUE UCA - COMUE Université Côte d'Azur (2015-2019) - AU - Avignon Université - AMU - Aix Marseille Université - CNRS - Centre National de la Recherche Scientifique - UCA - Université Côte d'Azur, North-Eastern Federal University)
    Abstract: Over recent years, the Arctic has become a key focus for the Russian Government, not only for the region's strategic importance but also for the economic potential that remains largely untapped due to poor accessibility of large parts of the territory and their detachment from major transportation and energy systems of the country. At the same time, considering the vulnerability of the Arctic ecosystem and the global trends toward energy transition and decarbonization, Renewable energy systems will likely need to play a key role in realizing the region's potential. Renewables have experienced exponential growth in recent years, as governments and societies are starting to understand the long-term implications of continued hydrocarbon reliance and the need for diversification and sustainable solutions for the future. The long-term sustainability of the economic development of the Arctic regions will be influenced by global environmental and climate regulation, as well as the ongoing transformation of energy markets. As more and more of Russia's economic partners are stepping on the path of carbon neutrality and increasing their goals to reduce emissions through improved energy efficiency measures and integration of green energy sources, Russia will need to consider embracing these global trends and begin incorporating the necessary policy changes in order to stay relevant and competitive in the long-term. Now is the perfect time to adopt the necessary incentives and prioritize resilient investments to help drive the country towards overcoming future economic and climate challenges and turn some of these potential hurdles into growth opportunities.
    Keywords: Green energy,Energy transition,Arctic,Sustainability,Energy security,Russia
    Date: 2022–07–22
  3. By: Harold, Brian MBA; Rodier, Caroline PhD; Zhang, Yunwan MS
    Abstract: Rural areas in California present unique transportation challenges associated with long travel distances, infrequent transit service, the cost of car ownership, and limited access to app-based rideshare services that are common to more populated urban centers. Researchers at the University of California, Davis, partnered with the eight San Joaquin Valley Metropolitan Planning Organizations to identify and support the development of innovative regional mobility pilot concepts, including an electric vehicle carsharing service known as Míocar. Míocar launched in August 2019 with roundtrip EV carsharing hubs in affordable housing complexes in the southern San Joaquin Valley. This study summarizes the data collected through a telephone survey with current Míocar users from January 2022 through March 2022. The survey asks users to reflect on their use of the service since they enrolled, and it builds upon past data collection efforts for this program by gathering detailed information on member characteristics, transportation needs and capabilities, and Míocar’s role as a transportation option for the users’ households. The results provide qualitative insights into members’ mobility challenges and considerations and the service’s impacts on user travel. Comparisons to existing carsharing programs suggest that Míocar is achieving similar impacts as other programs in some areas, such as reducing personal vehicle use, ownership, and associated greenhouse gas emissions. However, respondents emphasize its role in improving mobility within the rural region. The evaluation provides information for researchers to enhance future evaluations of rural carsharing, and findings may inform member recruitment, training, program design, and other efforts conducted by rural carsharing operators.
    Keywords: Social and Behavioral Sciences, Electric vehicles, carsharing evaluation, social equity, environmental justice, rural areas, rural transportation, pilot studies, low income groups
    Date: 2022–09–01
  4. By: Allister Loder; Fabienne Cantner; Andrea Cadavid; Markus B. Siewert; Stefan Wurster; Sebastian Goerg; Klaus Bogenberger
    Abstract: In spring 2022, the German federal government agreed on a set of measures that aimed at reducing households' financial burden resulting from a recent price increase, especially in energy and mobility. These measures included among others, a nation-wide public transport ticket for 9\ EUR per month and a fuel tax cut that reduced fuel prices by more than 15\,\%. In transportation research this is an almost unprecedented behavioral experiment. It allows to study not only behavioral responses in mode choice and induced demand but also to assess the effectiveness of transport policy instruments. We observe this natural experiment with a three-wave survey and an app-based travel diary on a sample of hundreds of participants as well as an analysis of traffic counts. In this third report, we provide first findings from the second survey, conducted during the experiment.
    Date: 2022–08
  5. By: Turco, Enrico; Bazzana, Davide; Rizzati, Massimiliano; Ciola, Emanuele; Vergalli, Sergio
    Abstract: Soaring energy prices since fall 2021 have prompted European governments to introduce policy measures to support households and businesses. In this paper, we employ the MATRIX model, a multi-sector and multi-agent macroeconomic model calibrated on the Euro Area, to analyze the economic and distributional effects of different types of macro-stabilization policies in response to energy price shocks. Simulation results show that, in the absence of stabilization policies, an increase in fossil fuel price would lead to a sharp growth in price inflation and a severe contraction in real GDP, followed by a slow but steady recovery. We find no significant effects of generalized tax cuts and household subsidies, while firm subsidies promote a faster recovery but at the expense of greater financial instability in the medium term due to the resulting market distortions. If timely adopted, government-funded energy tariff reduction is the most effective policy in mitigating GDP losses at relatively low public costs, especially if coupled with an extra-profit tax on energy firms. Energy entrepreneurs benefit from rising fuel prices in all policy scenarios, but to a lesser extent under energy tariff cuts and windfall profits tax, favouring, in that case, workers and downstream firms owners.
    Keywords: Demand and Price Analysis, Public Economics, Research Methods/ Statistical Methods, Resource /Energy Economics and Policy
    Date: 2022–09–09
  6. By: Penelope Buckley (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes); Daniel Llerena (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes)
    Abstract: Using a contextualised common pool resource framework, individual energy consumption choices are studied. Individuals are nudged towards the socially optimal level of consumption by the use of a happy (sad) face if they are underconsuming (overconsuming). A price is set to incentivise a second group to choose the level of consumption observed in the nudge treatment in order to quantify the nudge via an equivalent price. Across all 10 periods, consumption is significantly lower in treatment groups compared to control groups without nudges and prices. The price treatment leads to an average level of consumption above the Nash equilibrium. There are implications for policy makers as the nudge treatment performs as well, on average, as an equivalent price without the implied loss of welfare, and is understood and integrated into subjects' decision making quicker than an equivalent price. However, there is a tendency for both the nudge and the price to reinforce existing consumption behaviour as those who overconsume continue to overconsume.
    Keywords: Energy conservation,Financial incentive,Laboratory experiment,Nudge
    Date: 2022
  7. By: Jevan Cherniwchan (Department of Economics, Carleton University); M.Scott Taylor (Department of Economics, University of Calgary)
    Abstract: Considerable progress that has been made in our understanding of the relationship between international trade and the environment since Gene Grossman and Alan Krueger published their now seminal working paper examining the potential environmental effects of the North American Free Trade Agreement in 1991. This review uses their original paper as a guide to highlight key developments along three main branches of research that all stem from their analysis: (i) the interaction between international trade, economic growth, and environmental outcomes, (ii) the role of environmental regulation in determining trade and investment flows, and (iii) estimating the relative magnitudes of the scale, composition, and technique effects induced by trade. It discusses key developments along each branch, with a particular focus on the empirical challenges that have impeded progress. It also highlights an area along each branch that is ripe for further study. These areas are termed the Three Remaining Challenges.
    Keywords: International Trade and the Environment; Environmental Kuznets Curve; Pollution Haven Hypothesis
    JEL: F18 F64 O44 Q56
    Date: 2022–05–09
  8. By: Okumus, İlyas; Guzel, Arif Eser; Destek, Mehmet Akif
    Abstract: This study investigates the effects of renewable energy (REN) consumption and non-renewable energy (NREN) consumption on economic growth in G7 countries with annual data covering the period 1980-2016 using a new panel data estimator that provides robust results under cross-sectional dependence, slope heterogeneity, and can be used whether series are integrated in different orders. In addition, the causality between the variables is analyzed with the panel bootstrap Granger causality method takes cross-sectional dependency and slope heterogeneity into account. According to Cross-sectionally Augmented Autoregressive Distributed Lag (CS-ARDL) results, the coefficients of REN and NREN consumption are positive and statistically significant in both the short- and long-run. Furthermore, NREN consumption has a greater impact on enhancing economic growth than REN consumption. The panel bootstrap causality analysis reveals that the growth hypothesis (GH) is valid in REN in Canada, Italy, and the US; neutrality is valid in REN in France, Japan, and the UK; the feedback hypothesis (FE) is valid for REN only in Germany. For NREN, the GH is valid for Canada, France, and Germany; the conservation hypothesis (CH) is valid in Italy and the UK. Finally, the FH is valid in Japan and the US.
    Keywords: Renewable energy; non-renewable energy; CS-ARDL analysis; G7 countries; economic growth.
    JEL: Q4 Q43
    Date: 2021–03–28
  9. By: Bakari, Sayef
    Abstract: The aim of this paper is to examine the impact of natural resources, CO2 emission, energy use, domestic investment, innovation, trade, and digitalization on economic growth in the case of 52 African Countries. To attempt our goal, we used annual data of 52 African countries for the period 1996 to 2021 which was estimated by using random effect model, fixed effect model and Hausman test. Empirical results indicate that domestic investment, exports, natural resources and final consumption expenditure have a positive impact on economic growth. Also, we found that labor force, imports and energy use have a negative effect on economic growth. However, we found that CO2 emission, innovation and internet use don’t have any effect on economic growth. The study recommends vital policies that should focus on promoting domestic investment, exports, natural resources, and final consumption to stimulate economic growth in African countries. Similarly, it recommends creating new strategies to manage the role of the active population, imports, energy consumption, CO2 emissions, innovation, and digitalization to make their effects influential in improving the economic growth.
    Keywords: Natural Resources, CO2 Emission, Energy Use, Domestic Investment, Innovation, Trade, Digitalization, Economic Growth, African Countries.
    JEL: C10 C22 C23 E22 F11 F14 J60 O31 O32 O34 O40 O44 O47 O49 O55 Q43 Q47 Q48 Q50
    Date: 2022
  10. By: Liebrich M. HIEMSTRA
    Abstract: This article will explain the characteristics of the financial side of energy markets. It aims to clarify why financial contracts are needed in the energy sector and how such transactions are conducted by energy companies. A specific focus in this article is the low-carbon transition. This focus is also reflected in the description of the different types of financial contracts discussed herein, including derivatives relating to cap-and-trade schemes for CO2 emissions and environmental, social and governance (ESG) financial products. In addition, this article addresses how these financial contracts in the energy sector are regulated and will pay attention to anti-manipulation rules in the European Union and the United States. The low-carbon transition and climate finance is taken as a guidance in discussing the topics above and pursues to shed light on the question how financial contracts in the energy sector may contribute to a low-carbon transition.
    Keywords: Energy markets, derivative trading, REMIT, ACER, ESG, CO2
    Date: 2022–07
  11. By: Caporin, Massimiliano (Universita degli Studi di Padova); Fontini, Fulvio (Universita degli Studi di Padova); Panzica, Roberto (European Commission)
    Abstract: We analyse the evolution of the systemic risk impact of oil and natural gas companies since 2000. This period is characterised by several events that affected energy source markets: the real effect of the global financial crisis, the explosion of shale production and the diffusion of the Covid-19 pandemic. The price of oil and natural gas showed extreme swings, impacting companies' financial situations, which, accompanied by technological developments in shale production, had an impact on the debt issuance and on the overall risk level of the oil and natural gas sector. By studying the systemic impact of oil and natural gas companies on risk in the financial market, measured by the ∆CoVaR, we observe that in the most recent decade, their role is sensibly increasing compared to 2000–2010, even accounting for the possible effect associated with the increase in companies' sizes. In addition, our results show evidence of a decreasing relevance of traditional drivers of systemic risk, suggesting that additional factors might be present. Finally, when focusing on the impact of Covid-19, we document its relevant role in fueling the increase in the oil and natural gas companies' systemic impact.
    Keywords: Systemic risk, Oil and Natural Gas, Fossil Fuel, Energy
    JEL: Q43 Q40 G10 C21 C58
    Date: 2022–07
  12. By: Alessi, Lucia (European Commission); Di Girolamo, Francesca Erica (European Commission); Pagano, Andrea (European Commission); Petracco Giudici, Marco (European Commission)
    Abstract: This paper uses a stylized simulation model to assess the potential impact of transition risk on banks' balance sheets and establishes a basis for calibrating relevant macro-prudential instruments. We show that even in the short run, a fire-sale mechanism could amplify an initially contained shock on high-carbon assets into a systemic crisis with significant losses for the EU banking sector. We calculate that an additional capital buffer of 0.5% RWA on average would be sufficient to protect the system. Moreover, under an orderly transition, the decrease in banks’ transition risk exposure due to the greening of the economy would reduce the effect of a fire-sale by a factor of 10.
    Keywords: Green transition risk, dynamic balance sheet, banking crisis
    JEL: C15 G2 Q54
    Date: 2022–06
  13. By: Yiwen Chen (Université du Luxembourg (Extramural Research Fellow)); Xi Wan (Nanjing Audit University); Benteng Zou (Université du Luxembourg)
    Abstract: "Carbon capture and storage (CCS) is considered one of the most realistic and plausi- " ble options for reducing greenhouse gas (GHG) emissions from large pollution sources. However, CCS deployment is costly. This paper considers the social cost of CCS projects and GHG damage from a central planer's point of view, providing clear in- formation about when each player should deploy CCS. The findings are twofold: (1) given the heterogeneity of players, it is not socially optimal for all players to start CCS projects at the same time; instead, the player that has a cost advantage should start first; (2) it may be socially desirable for the player with a cost disadvantage never starts CCS. We show the conditions that support both possibilities. The second find- ing provides a clear policy guideline for the decision-maker: reduce the costs of the high-cost player in order to reduce global GHG emissions, provided that is the aim of the supranational institute
    Keywords: Carbon capture and storage, multistage optimal control, optimal timing.
    JEL: Q54 Q58 C61
    Date: 2022
  14. By: Schenuit, Felix; Böttcher, Miranda; Geden, Oliver
    Abstract: The implementation of the new net emission targets for 2030 and 2050 as part of the European Green Deal is moving the deliberate removal of CO2 from the atmosphere up the agendas of political decision-makers. In its latest report, the Intergovernmental Panel on Climate Change (IPCC) also recently reiterated that net-zero targets cannot be achieved without the deployment of carbon dioxide removal (CDR) methods. The political debate in the European Union (EU) about CDR has changed rapidly in recent years, with almost all political actors now calling for a new regulatory framework for CDR to become an integral building block of EU climate policy. However, fundamental conflicts are brewing over the question as to which removal methods and policy instruments should be implemented and which priorities should be set. There are signs of emerging political alliances on the EU level that will shape the Fit-for-55 legislation in the short term and prestructure the debate on the design of climate policy between 2030 and 2040.
    Date: 2022
  15. By: D’Arcangelo, Filippo Maria; Pavan, Giulia; Calligaris, Sara
    Abstract: The European Union Emissions Trading System has raised concerns about possible detrimental effects on firms production through an increase in polluting costs, unless firms change inputs or increase the efficiency in the way they produce. We provide evidence of the causal impact of this policy on firms' input choices and on total factor productivity on Italian manufacturing firms. Our empirical strategy combines structural estimation of firms' production function and techniques for policy valuation. Moreover, we argue that a commonly used strategy in this literature, consisting in using propensity score matching on the productivity obtained from estimating the production function, does not provide valid inference. We rely instead on an innovative structural approach. We find that the policy has a small negative effect on productivity that is heterogeneous across industries. We show that these findings are consistent with firms switching fuels in production, rather than undergoing a substantial process change.
    Keywords: Financial Economics, Production Economics, Productivity Analysis, Resource /Energy Economics and Policy
    Date: 2022–09–08
  16. By: Bontadini, Filippo; Vona, Francesco
    Abstract: We study green specialisation across EU countries and detailed 4-digit industrial sectors over the period of 1995-2015 by harmonizing product-level data (PRODCOM). We propose a new list of green goods that refines lists proposed by international organizations by excluding goods with double usage. Our analysis reveals important structural characteristics of green specialisation in the manufacturing sector. First, green production is highly concentrated, with 13 out of 119 4-digit industries, which are high-tech and account for nearly 95% of the total. Second, green and polluting productions do not occur in the same sectors, and countries specialise in either green or brown sectors. Third, our econometric analysis identifies three key drivers of green specialisation: (i) first-mover advantage and high persistence of green specialisation, (ii) complementarity with non-green capabilities and (iii) the degree of diversification of green capabilities. Importantly, once we control for these drivers, environmental policies are not anymore positively associated with green specialisation.
    Keywords: Production Economics, Resource /Energy Economics and Policy
    Date: 2022–06–17
  17. By: Schenuit, Felix; Böttcher, Miranda; Geden, Oliver
    Abstract: Mit der Umsetzung der neuen Netto-Emissionsziele für 2030 und 2050 im Rahmen des Europäischen Green Deal rückt die aktive Entnahme von CO2 aus der Atmosphäre in den Fokus politischer Entscheidungs­träger. Dass Netto-Null-Ziele ohne den großskaligen Einsatz von Maßnahmen zur CO2-Entnahme (Carbon Dioxide Removal, CDR) nicht erreicht werden können, hat auch der Weltklimarat IPCC in seinem jüngsten Bericht zur Minderung des Klimawandels erneut dargelegt. In den vergangenen Jahren hat sich die politische Debatte in der EU rasant verändert. Mittlerweile fordern nahezu alle politischen Akteure einen neuen regulatorischen Rahmen für die Bindung von CO2 als integralen Baustein der EU-Klimapolitik. Über die Frage, welche Methoden und Politikinstrumente dafür verwendet und welche Schwerpunkte gesetzt werden sollen, bahnen sich indes grundlegende Konflikte an. Auf EU-Ebene sind erste Ansätze für politische Allianzen erkennbar, die kurzfristig die Fit-for-55-Gesetzgebung prägen und mittelfristig die Debatte über die Ausgestaltung der Klimapolitik zwischen 2030 und 2040 vorstrukturieren werden
    Date: 2022
  18. By: Claire Alestra (AMSE - Aix-Marseille Sciences Economiques - EHESS - École des hautes études en sciences sociales - AMU - Aix Marseille Université - ECM - École Centrale de Marseille - CNRS - Centre National de la Recherche Scientifique); Gilbert Cette (NEOMA - Neoma Business School); Valérie Chouard (Centre de recherche de la Banque de France - Banque de France); Rémy Lecat (Centre de recherche de la Banque de France - Banque de France)
    Abstract: This paper provides a tool to build climate change scenarios to forecast Gross Domestic Product (GDP), modelling both GDP damage due to climate change and the GDP impact of mitigating measures. It adopts a supply-side, long-term view, with 2060 and 2100 horizons. It is a global projection tool (30 countries/regions), with assumptions and results both at the world and the country/regional level. Five different types of energy inputs are taken into account according to their CO2 emission factors. Full calibration is possible at each stage, with estimated or literature-based default parameters. Compared to other models, it provides a comprehensive modelisation of Total Factor Productivity (TFP), which is the most significant determinant of the GDP projected path. We present simulation results of different energy policy scenarios. They illustrate both the "tragedy of the horizon" and the "tragedy of the commons", which call for a policy framework that adequately integrates a long run perspective, through a low-enough discount rate and an effective intergenerational solidarity as well as international cooperation.
    Keywords: Climate,Global warming,Energy prices,Environmental policy,Growth,Productivity,Long-term projections
    Date: 2022–01
  19. By: Ansari, Dawud
    Abstract: The countries of the Gulf Cooperation Council (GCC) are mapping out agendas to kickstart a hydrogen economy. Especially Saudi Arabia, Oman, and the United Arab Emirates (UAE) are pursuing ambitious plans to supply Europe and Asia-Pacific with the carbon-friendly fuel. Numerous declarations of intent have been signed, and the first large-scale projects are under way. For the Gulf countries, hydrogen is not only a means of diversification. Since the hydrogen economy blends into the institutional and fiscal framework of the petroleum industry, it is primarily a chance for the GCC economies to maintain current economic and political power structures. While hydro­gen from the Gulf is an effective tool for climate change mitigation, Germany and Europe are faced with trade-offs and open questions.
    Date: 2022
  20. By: Pratik Kute (Phd candidate)
    Abstract: The relationship between India and Qatar has reached its jubilee celebrations. The year 2022 marks the completion of glorious 50 years of ties between the two countries. The relation is stronger than ever before and has deepened and strengthened over the years. Although the ties begun in the form of diplomatic and political engagements it slowly expanded in the realm of socio-economic aspects of its relations. India has one of the largest diaspora in Qatar and it plays an important role in the countries development and growth. Qatar has invested heavily in India looking at a promising future in the years to come. The gas trade between the two is pivotal to its energy ties. There are some points of contestations between two but both the countries are trying to overcome such issues of disagreement and move forward. As both the countries have reached about half a century of relationship, it is the right time to reflect on their past accomplishments, upcoming opportunities and some of the challenges they face to their ties. Key words: Counter-terrorism, Diaspora, Diplomacy, Energy, Tourism
    Date: 2022–03
  21. By: Giulio Galdi; Roberto Casarin; Davide Ferrari; Carlo Fezzi; Francesco Ravazzolo
    Abstract: This study proposes different modelling approaches which exploit electricity market data to nowcast industrial production. Our models include linear, mixed-data sampling (MIDAS), Markov-Switching (MS) and MS-MIDAS regressions. Comparison against a commonly applied autoregressive approach shows that electricity market data signif- icantly improves nowcasting performance especially during turbulent economic states characterised by high volatility and uncertainty, such as those generated by the recent COVID-19 pandemic. The most promising results are provided by MS models, which identify two regimes of different volatility. These results confirm that electricity mar- ket data provide timely and easy-to-access information for nowcasting macroeconomic variables, especially when it is most valuable, i.e. during times of crisis and uncertainty.
    Date: 2022
  22. By: Marion Dupoux (GU - University of Gothenburg , IFPEN - IFP Energies nouvelles - IFPEN - IFP Energies nouvelles, EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique); Vincent Martinet (UMR PSAE - Paris-Saclay Applied Economics - AgroParisTech - Université Paris-Saclay - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CEPS - Centre d'Economie de l'ENS Paris-Saclay - Université Paris-Saclay - ENS Paris Saclay - Ecole Normale Supérieure Paris-Saclay)
    Abstract: Theoretical models often assume the environment to be a normal good, irrespective of one's income. However, a priori, nothing prohibits an environmental good from being normal for some individuals and inferior for others. We develop a conceptual framework in which private consumption and an environmental public good act as substitutes or complements for satisfying different needs. Subsequently, the environment can switch between normal and inferior depending on one's income and environment and corresponding prevalent needs. If the environment is inferior for some range of income, then the willingness to pay for environmental preservation becomes non-monotonic with respect to income. We discuss the relevance of our framework in the context of (income-adjusted) unit benefit transfers, dual-rate discounting and the Environmental Kuznets curve.
    Keywords: Environment,Public goods,Context-dependant substituability,Need,Willingness to Pay,Inferior good
    Date: 2022–08
  23. By: Tobias Adrian; Nina Boyarchenko; Domenico Giannone; Ananthakrishnan Prasad; Dulani Seneviratne; Yanzhe Xiao
    Abstract: We use a long history of global temperature and atmospheric carbon dioxide (CO2) concentration to estimate the conditional joint evolution of temperature and CO2 at a millennial frequency. We document three basic facts. First, the temperature–CO2 dynamics are non-linear, so that large deviations in either temperature or CO2 concentrations take a long time to correct–on the scale of multiple millennia. Second, the joint dynamics of temperature and CO2 concentrations exhibit multimodality around historical turning points in temperature and concentration cycles, so that prior to the start of cooling periods, there is a noticeable probability that temperature and CO2 concentrations may continue to increase. Finally, evaluating the future evolution of temperature and CO2 concentration conditional on alternative scenarios realizing, we document that, even conditional on the net-zero 2050 scenario, there remains a significant risk of elevated temperatures for at least a further five millennia.
    Keywords: climate change; multimodality; Network for Greening the Financial System (NGFS) scenarios
    JEL: Q54 C14 C53
    Date: 2022–09–01
  24. By: Alessi, Lucia (European Commission); Hirschbuhl, Dominik (European Commission); Rossi, Alessandro (European Commission)
    Abstract: In a context where European stock prices have been trending upwards, one of the main concerns is that stocks perceived as more sustainable from an environmental, social and governance (ESG) perspective could be particularly exposed to exuberance. To shed some light on the magnitude of the deviation of stock prices from fundamentals we apply a Markov-switching augmented version of the present-value model. Using monthly data on the European stock market from 2005 to 2022, our model suggests that at the beginning of 2022 the non-fundamental component was about one fourth of the total price. When looking at particular market segments, the model shows that green and ESG stocks behave broadly in line with the market. However, in recent years ESG stocks have shown a significant, though small, disconnect from the market. These finding suggest that investor preferences are shifting towards sustainability, while not posing immediate risks to market stability.
    Keywords: Bayesian inference, European stock market, green transition, Markov-switching, present-value model
    JEL: C11 C32 G12
    Date: 2022–07
  25. By: ITF
    Abstract: Trucks account for one-fifth of transport sector emissions in Europe. To decarbonise, heavy-duty road freight must switch to zero-emission vehicles quickly. This report examines whether battery electric vehicles, electric road systems and hydrogen fuel cell vehicles could compete with diesel-driven vehicles. It looks at the total cost of ownership across nine different vehicle-size segments in Europe. The report gives six recommendations to accelerate the transition to zero-emission trucks, including the provision of necessary infrastructure.
    Date: 2022–09–05
  26. By: Pizarro Gariazzo, Rodrigo
    Abstract: Debido a su naturaleza global y al alcance de su impacto, el cambio climático plantea una serie de desafíos complejos e interconectados para la política pública. Por ello, los países necesitan disponer de una amplia variedad de datos e indicadores para comprender todos los factores vinculados a la gestión climática y las múltiples dimensiones que esta abarca: las presiones y fuerzas motrices que actúan sobre el cambio climático, los efectos directos e indirectos que este tiene en los sistemas humanos y ambientales y, sobre todo, la evaluación de las respuestas que ofrece la gestión pública. El Sistema de Contabilidad Ambiental y Económica (SCAE) conceptualiza el nexo entre medio ambiente y economía aplicando un enfoque sistémico para integrar información de distintos ámbitos. El objetivo de este documento es explicar cómo el SCAE puede usarse para apoyar la toma de decisiones relativas al cambio climático, teniendo en cuenta que solo un marco estadístico completo, que integre información de múltiples fuentes y sistemas, puede dar cuenta de la complejidad del cambio climático y permitir la generación de la información necesaria para adoptar decisiones adecuadas.
    Date: 2022–05–31
  27. By: Geir B. Asheim (Department of Economics [Oslo] - Faculty of Social Sciences [Oslo] - UiO - University of Oslo); Kohei Kamaga (Sophia University [Tokyo]); Stéphane Zuber (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique)
    Keywords: climate change,efficiency,intergenerational equity,population ethics,infinite streams
    Date: 2022
  28. By: Anna Bartocci (Bank of Italy); Alessandro Notarpietro (Bank of Italy); Massimiliano Pisani (Bank of Italy)
    Abstract: This paper evaluates the macroeconomic effects of increasing taxes on fossil fuels (“carbon tax†) and subsidies for renewable energy and reducing labor income tax in the euro area, and the interaction of these effects with domestic monetary policy. The tax increase is announced, gradually implemented and fully anticipated by agents (thus it is conceptually different from a sudden and unexpected positive shock affecting the international prices of fossil fuels). The analysis makes use of a New Keynesian two-country model with an energy sector, calibrated to the euro area and the rest of the world. The main results are the following. First, an increase in the carbon tax generates recessionary effects. Second, higher subsidies for green energy and a lower labor tax can limit the macroeconomic cost of increasing the carbon tax. Third, if the monetary policy rate is at its effective lower bound, the fiscal policy mix generates short-run recessionary effects, which can be offset if the central bank, for monetary policy purposes, purchases long-term sovereign bonds in the secondary market, thus keeping long-term interest rates low.
    Keywords: environmental policy, energy policies, dynamic general equilibrium model, fiscal policy, monetary policy, euro area
    JEL: D58 E52 E62 Q43
    Date: 2022–07
  29. By: Mari Luomi; Fatih Yilmaz; Thamir Alshehri (King Abdullah Petroleum Studies and Research Center)
    Abstract: Over the past year, all six Gulf Cooperation Council (GCC) countries have updated their medium-term greenhouse gas (GHG) emission targets by submitting revised nationally determined contributions (NDCs) under the Paris Agreement. Bahrain, Saudi Arabia, the United Arab Emirates (UAE), and Saudi Aramco have also announced net-zero emission targets. Work is now beginning to develop more detailed roadmaps and implementation plans, some elements of which are already laid out in the updated NDCs.
    Keywords: Circular carbon economy, Energy transition,
    Date: 2022–06–14
  30. By: Pavel Ciaian; Andrej Cupák (National Bank of Slovakia); Pirmin Fessler; d’Artis Kancs
    Abstract: Individuals invest in Environmental-Social-Governance (ESG)-assets not only because of (higher) expected returns but also driven by ethical and social considerations. Less is known about ESG-conscious investor subjective beliefs about crypto-assets and how these compare to traditional assets. Controversies surrounding the ESG footprint of certain crypto-asset classes – mainly on grounds of their energy-intensive crypto mining – offer a potentially informative object of inquiry. Leveraging a unique representative household finance survey for the Austrian population, we examine whether investors’ environmental and social preferences can explain cross-sectional differences in individual portfolio exposure to crypto-assets. We find a strong association between investors’ environmental and social preferences and the crypto-investment exposure but no significant relationship for the benchmarks of traditional asset classes such as bonds and shares.
    JEL: D14 G11 G41
    Date: 2022–09
  31. By: : Papadopoulos, Georgios (European Commission)
    Abstract: Corporate greenhouse gas (GHG) emissions data underpin almost every economic analysis related to climate change, spanning from firms’ transition risk to their ESG ratings and, ultimately, their reduction is fundamental in addressing global warming. However, various quality issues plague relevant data. This study documents the scale of discrepancies in GHG emissions data among three commercial data providers along various dimensions, investigates the reasons behind these and examines the possible ramifications for assessing firms’ environmental performance. It finds widespread inconsistencies between data providers in every emissions category, through time and across sectors. The lowest -yet important- inconsistencies are observed in direct emissions data (Scope 1) and they progressively increase in indirect emissions (Scope 2 and Scope 3). A sectoral analysis reveals specific sectors with higher levels of inconsistencies. A detailed investigation shows that inconsistencies originate from a few, common sources, mostly related to the nature of emissions disclosure requirements. Finally, a simple ranking exercise exhibits that these inconsistencies can translate into diverging carbon performance assessments.
    Keywords: corporate GHG emissions, disclosure, data inconsistency, corporate carbon performance
    JEL: Q53 Q54 Q56
    Date: 2022–07
  32. By: Raouf Boucekkine (Rennes School of Business); Carmen Camacho (Paris School of Economics & CNRS); Weihua Ruan (Purdue University Northwest); Benteng Zou (Université du Luxembourg)
    Abstract: We solve a bimodal optimal control problem with a non-concavity and uncertainty through a Poisson process underlying the transition from a mode to another. We use a dynamic programming approach and are able to uncover the global optimal dynamics (including optimal non-monotonic paths) under a few linear-quadratic assumption, which do not get rid of the non-concavity of the problem. This is in contrast to the related literature on pollution control under irreversibility which usually explores local dynamics along monotonic solution paths to first-order Pontryagin conditions.
    Keywords: Multi-stage optimal control, Poisson process, HJB equations, irreversible pollution.
    Date: 2022
  33. By: Sophio Togonidze (Institute of Economic Studies, Charles University, Prague, Czech Republic); Evzen Kocenda (Institute of Economic Studies, Faculty of Social Sciences, Charles University, Prague, Czech Republic & Institute of Information Theory and Automation, Prague, Czech Republic & CESifo Munich; IOS Regensburg)
    Abstract: We investigate an impact of oil-price shocks on GDP and exchange rate dynamics in resource-heterogeneous economies. We employ a Markov regime-switching version of a vector autoregressive (VAR) model to allow for regime shifts, non-linear effects and timevarying parameters of the VAR process. Empirically we use quarterly data series in oil exporting, metal-exporting, and less-resource-intensive economies. On average, real GDP in oil-exporting economies exhibits substantial contraction, while for metal exporters there is a significant real GDP expansion suggesting an offsetting effect of metal exports on oil imports. We find that currency appreciation state is more persistent in oil- and metal exporting economies while less-resource-intensive economies remain longer in a currency depreciation state. Further evidence suggests existence of the counteracting forces such as foreign exchange interventions by authorities in oil-exporting economies. It also emerges that currency appreciation in oil-exporting economies is driven largely by economic performance rather than oil price movement.
    Keywords: Emerging economies, Oil shocks, GDP, Markov regime-switching, Exchange rate, Oil exporters, Metal exporters
    JEL: F44 E37 C11 E32 C22 C58 F31 Q43
    Date: 2022–09
  34. By: Emanuela Benincasa (University of Zurich and Swiss Finance Institute); Jonathan Fu (University of Zurich); Mrinal Mishra (University of Zurich); Adityavardhan Paranjape (Zurich Insurance Group)
    Abstract: We document the existence of a premium in the green bond market based on the greenness of green bonds. Using BERT, a natural language processing method for textual analysis, we develop a novel measure for bonds’ greenness and document that a 10 percent increase in the bond’s greenness corresponds to a decrease in annualized yield by between 4.86 to 8.71 basis points. In addition to greener bonds enjoying higher premiums, we find evidence that issuing a green bond has positive spillover effects on the pricing of subsequent conventional bonds’ issuance. Overall, our findings are consistent with firms relying on “green" debt instruments to lower capital costs and raise cheaper financing.
    Keywords: Green bonds; BERT model; Sustainable Finance; Bond premium
    JEL: G12 Q56
    Date: 2022–08
  35. By: Emanuel Kohlscheen
    Abstract: This study analyses oil price movements through the lens of an agnostic random forest model, which is based on 1,000 regression trees. It shows that this highly disciplined, yet flexible computational model reduces in sample root mean square errors by 65% relative to a standard linear least square model that uses the same set of 11 explanatory factors. In forecasting exercises the RMSE reduction ranges between 51% and 68%, highlighting the relevance of non linearities in oil markets. The results underscore the importance of incorporating financial factors into oil models: US interest rates, the dollar and the VIX together account for 39% of the models RMSE reduction in the post 2010 sample, rising to 48% in the post 2020 sample. If Covid 19 is also considered as a risk factor, these shares become even larger.
    Date: 2022–08
  36. By: Jonathan Berrisch; Sven Pappert; Florian Ziel; Antonia Arsova
    Abstract: We study the prices of European Emission Allowances (EUA), whereby we analyze their uncertainty and dependencies on related energy markets. We propose a probabilistic multivariate conditional time series model that exploits key characteristics of the data. The forecasting performance of the proposed model and various competing models is evaluated in an extensive rolling window forecasting study, covering almost two years out-of-sample. Thereby, we forecast 30-steps ahead. The accuracy of the multivariate probabilistic forecasts is assessed by the energy score. We discuss our findings focusing on volatility spillovers and time-varying correlations, also in view of the Russian invasion of Ukraine.
    Date: 2022–08
  37. By: Valenti, Daniele; Bastianin, Andrea; Manera, Matteo
    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: Research Methods/ Statistical Methods, Resource /Energy Economics and Policy
  38. By: Fremerey, Melinda; Gerards Iglesias, Simon
    Abstract: Die Auswirkungen des russischen Angriffskriegs verdeutlichen die Gas-Abhängigkeit der deutschen Volkswirtschaft von Russland. Nichtsdestotrotz bestehen viele unterschiedliche Steuervergünstigungen in Form von Steuernachlässen und -subventionen für den Verbrauch von Gas. 2021 wurden Steuervergünstigungen für 447 Terawattstunden für insgesamt über 2,1 Mrd. Euro erstattet. Dies sind 44 Prozent des Gasverbrauchs im Jahr 2021. Die Gasvergünstigungen stellen ökonomisch gesehen ein zweischneidiges Schwert dar.
    Date: 2022
  39. By: Tastan, Kadri
    Abstract: The desire of the European Union (EU) to reduce its dependency on Russia for gas and diversify its sources of supply by turning to the resources of Central Asia, the Middle East, and the Eastern Mediterranean regions theoretically gives Turkey a major role in the EU's diversification and energy security policy. However, this strategic role for Turkey seems to be overestimated, given the limited share of energy that transits through Turkey to Europe. With the Russian invasion and Europe's search for alter­native energy sources in extremis, the old discussion resurfaces: Could Turkey become a major transit country for energy supplies? Given the structural changes that have occurred in the energy markets, the objective of decarbonisation, and of course the political and infrastructural challenges, it seems that this old dream will not come true this time either.
    Date: 2022
  40. By: Noura Mansouri Robert J. Budnitz H-Holger Rogner Charles McCombie Robert N. Schock Adnan Shihab-Eldin; Robert J. Budnitz H-Holger Rogner Charles McCombie Robert N. Schock Adnan Shihab-Eldin; H-Holger Rogner Charles McCombie Robert N. Schock Adnan Shihab-Eldin; Charles McCombie Robert N. Schock Adnan Shihab-Eldin; Robert N. Schock Adnan Shihab-Eldin; Adnan Shihab-Eldin (King Abdullah Petroleum Studies and Research Center)
    Abstract: Nuclear energy is already playing a crucial role in reducing emissions from electricity generation. However, if this role is not expanded, achieving the international goal of avoiding unacceptable global climate change will be extremely difficult. The evidence presented in this study shows that nuclear energy’s climate benefits can be obtained without significant impacts to safety, security or energy costs.
    Keywords: Climate change, Electricity
    Date: 2022–08–23
  41. By: Garratt, Anthony; Petrella, Ivan; Zhang, Yunyi
    Abstract: We evaluate US Energy Information Agencies (EIA) forecasts of the world petroleum market, emphasising the importance of taking a multivariate perspective, considering asymmetric loss and allowing for time-variation. Forecasts for total demand, total supply, total stock withdrawals and the oil prices are biased, with biases that change over time and differ across variables. A loss function that takes into account asymmetry and interdependence can rationalise these biases. The implied asymmetric loss gives less weight to under-prediction of both demand and supply, while for oil prices, we document significant regime changes in the implied loss due to asymmetry. The EIA forecasts dominate a simple random walk benchmark when evaluated using symmetric and independent loss in the form of MSE statistical criteria. Yet, when allowing for asymmetry and interdependence that rationalize the EIA forecasts, the performance of the EIA forecasts worsens and is comparable to the random walk benchmark.
    Keywords: EIA forecasts, oil market, forecast rationality, non-separable loss, asymmetric loss.
    JEL: C32 C53 E37 Q47
    Date: 2022–08–25
  42. By: Juan-Pablo Rud (Royal Holloway, University of London); Michael Simmons (Umeå University); Gerhard Toews (New Economic School); Fernando Aragon (Simon Fraser University)
    Abstract: The reduction of carbon emissions will require a rapid phasing out of coal and the displacement of millions of coal miners. How much could this energy transition cost mining workers? We use the dramatic collapse of the UK coal industry to estimate the long-term impact on displaced miners. We find evidence of substantial losses: wages fall by 40% and earnings fall by 80% to 90% one year after job loss. The losses are persistent and remain significantly depressed fifteen years later, amounting to present discounted value earnings losses of between four and six times the miners pre-displacement earnings. (JEL J30, J63, J64, O4)
    Date: 2022–09
  43. By: Marie Petitet; Frank Felder; Khalid Alhadhrami (King Abdullah Petroleum Studies and Research Center)
    Abstract: In February 2021, Texas experienced an extreme cold snap causing a dramatic electricity blackout that left millions of households without electricity, resulting in over 200 fatalities and economic damages of approximately $100 billion. The Texas blackout has been used to support a variety of claims regarding renewable energy, electricity markets and climate change. We identify the blackout’s drivers and what has been learned since then. These lessons apply to power systems worldwide, including those of the Gulf Cooperation Council and the broader Middle East and North Africa region.
    Keywords: Market reforms, Reliability, Renewable energy
    Date: 2022–06–14

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