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on Energy Economics |
| By: | Ajayi, V.; Pollitt, M. |
| Abstract: | The gas industry in Great Britain has witnessed periodic regulatory reviews and large corporate changes over the last few decades. We undertake two separate analyses for the total factor productivity (TFP) of the gas networks using a non-parametric data envelopment analysis (DEA) approach to assess how these changes are impacting on productivity growth. First, we set out different models for the TFP analysis, each for gas transmission and distribution network, to examine how changes in incentive mechanism have influenced the measured TFP using quality of service and environmental targets. Quality standards from regulators warrant some adjustment to explore industry productivity growth. Second, we construct a combined single series for distribution and transmission using financial data to uncover how corporate reorganisations have impacted measured productivity to get a new perspective in the years before and after restructuring, when the industry went from being a single integrated transmission and distribution network to the disintegrated networks of today. We find a negative TFP growth of -1.6% p.a. for gas transmission over the sample period (2006/07-2018/19). Although, this is reversed to a positive growth once quality is included. For gas distribution, we actually find that productivity regress at -6.2% p.a. over the sample period (2006/07-2018/19), with the negative TFP trend observed across all the models, despite the inclusion of quality variables. However, we find a slightly higher TFP growth of 1% using corporate accounts over the 25 years from 1995/1996-2020/2021. The period before restructuring has a more positive productivity compared to the post-restructuring era with negative productivity growth. |
| Keywords: | Total factor productivity, incentive regulation, corporate reorganisations, gas networks, data envelopment analysis. |
| JEL: | C23 D24 L51 L94 |
| Date: | 2022–10–03 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2254&r= |
| By: | Mats Kröger; Maximilian Longmuir; Karsten Neuhoff; Franziska Schütze |
| Abstract: | Natural gas prices in Germany saw a strong increase at the end of 2021, subsequently worsening with the start of the war in Ukraine in February 2022, raising concerns about the distributional consequences. Our study shows that low-income households are affected the most by the natural gas price increase. Low-income households pay at the median 11.70 percent of their equivalent income on gas bills, compared to 6.21 percent in 2020. Contrarily, high-income households pay at the median 2.41 percent, compared to 1.52 in 2020. Natural gas expenditures are higher for tenants in detached houses and in houses with no double glassing or thermal insulation. Our policy analysis builds on an exploration of new energy expenditure data in 2020 provided by the German Socio-Economic Panel, and shows that a well-targeted subsidy scheme can be more effective for reducing inequality and less costly than a subsidy for all households. Additionally, the introduction of a minimum energy-efficiency standard for buildings can help reduce inequality in the medium-term. |
| Keywords: | Natural gas prices, income distribution, energy efficiency, building retrofit |
| JEL: | D30 Q41 I38 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp2010&r= |
| By: | Weichenrieder, Alfons J. |
| Abstract: | This note argues that in a situation of an inelastic natural gas supply a restrictive monetary policy in the euro zone could reduce the energy bill and therefore has additional merits. A more hawkish monetary policy may be able to indirectly use monopsony power on the gas market. The welfare benefits of such a policy are diluted to the extent that some of the supply (approximately 10 percent) comes from within the euro zone, which may give rise to distributional concerns. |
| Keywords: | energy crisis,monetary policy,natural gas |
| JEL: | E52 Q31 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:safewp:360&r= |
| By: | Michael Grubb (University College London) |
| Abstract: | The energy crisis engulfing Europe is a crisis of both gas and electricity markets, with huge cost impacts on consumers across all European countries. In Britain, half of typical household energy expenditure arises from electricity. This paper examines how the cost of gas-powered generation feeds through to electricity bills, on the principle of marginal cost pricing, setting the price for most of the time though it accounts for only about 40% of GB generation. Combined with the steep decline in wind and solar costs over the past decade, this has resulted in an unprecedented degree of 'cost inversion' in the electricity system. We offer estimates of the increase of revenues across the wholesale market, and outline five principles for reform for addressing the combined challenges of energy costs and accelerating low-carbon transition. |
| Keywords: | Electricity market design; energy crisis; marginal cost pricing; energy transition; energy poverty |
| JEL: | L16 L51 L94 L98 Q4 Q28 Q58 |
| Date: | 2022–09–06 |
| URL: | http://d.repec.org/n?u=RePEc:thk:wpaper:inetwp191&r= |
| By: | Ferrari, Alessandro; Landi, Valerio Nispi |
| Abstract: | We analyse a gradual increase in the tax on emissions in a simple two-period New Keynesian model with an AS-AD representation. We find that the increase in the tax today exerts inflationary pressures, but the expected further increase in the tax tomorrow depresses current demand, putting downward pressure on prices: we show that the second effect is larger. However, if households do not anticipate a future fall in income (because they are not rational or the government is not credible), the overall effect of the transition may be inflationary in the first period. We extend the analysis in a medium-scale DSGE model and we find again that the green transition is deflationary. Also in this larger model, by relaxing the rational expectations assumption, we show the transition may initially be inflationary. JEL Classification: D84, E31, Q58 |
| Keywords: | aggregate prices, AS AD, climate policy, expectations, pollution tax |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20222726&r= |
| By: | Huiwen Gong (Department of Environmental Social Science, Eawag, Dübendorf, Switzerland); Allan Dahl Andersen (Centre for Technology, Innovation and Culture (TIK), University of Oslo, Norway) |
| Abstract: | As sustainability transitions in some sectors enter an acceleration phase, widespread diffusion of low-carbon technologies seem inevitable. While the availability of critical natural resources will inevitably influence the pace and direction of sustainability transitions, there is as yet little exploration on the role of natural resources in such upscaling and diffusion processes in transition studies. Drawing on the literature on technological innovation systems (TIS), this paper develops an analytical approach to highlight the natural resource dimension in a TIS value chain and link it to TIS dynamics (functional and structural) in the face of inter-sectoral imbalances caused by natural resource scarcity in accelerating transition processes. Empirically we study China's EV battery TIS which shows that a shortage of critical natural resource (especially lithium) has influenced the TIS functional and structural dynamics both within and across sectors and can severely impact transition processes. Overall, we plea for more research on natural resources in transition studies as many low-carbon technologies enter an upscaling and diffusion phase. |
| Date: | 2022–10 |
| URL: | http://d.repec.org/n?u=RePEc:tik:inowpp:20221001&r= |
| By: | Viktor Stojkoski; Philipp Koch; C\'esar A. Hidalgo |
| Abstract: | To achieve inclusive green growth, countries need to consider a multiplicity of economic, social, and environmental factors. These are often captured by metrics of economic complexity derived from the geography of trade, thus missing key information on innovative activities. To bridge this gap, we combine trade data with data on patent applications and research publications to build models that significantly and robustly improve the ability of economic complexity metrics to explain international variations in inclusive green growth. We show that measures of complexity built on trade and patent data combine to explain future economic growth and income inequality and that countries that score high in all three metrics tend to exhibit lower emission intensities. These findings illustrate how the geography of trade, technology, and research combine to explain inclusive green growth. |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2209.08382&r= |
| By: | Philip Kerner; Torben Klarl; Tobias Wendler |
| Abstract: | Green technologies are at the very core of endeavors to combine economic and environmental targets to achieve sustainable growth. In this article, we aim to determine the impact of green technology development on total factor productivity of European regions. Our paper contributes to the literature on technological change and regional growth in various ways. i) Our paper is, to the best of our knowledge, the first to assess the specific role of green technologies for regional growth on a broad empirical base. ii) We advance methodologically on the pertinent literature by explicitly accounting for cross-sectional dependence in our empirical approach. iii) By providing a simple theoretical framework, we directly link our results to implications of environmental policies for capital accumulation and composition dynamics, contributing to the ongoing debate revolving around the strong version of the Porter hypothesis. Our results, based on a sample of 270 European NUTS-2 regions over 25 years, imply that general technology development is mostly associated with positive economic returns, but our data is not supportive of positive economic returns to green technologies. |
| Keywords: | Regional Growth, Green Technologies, Environmental Policy, Cross-Sectional Dependence |
| JEL: | C23 O0 O33 |
| Date: | 2021–06 |
| URL: | http://d.repec.org/n?u=RePEc:atv:wpaper:2104&r= |
| By: | Creon Butler (Chatham House); Sean Hagan (Peterson Institute for International Economics); Dominic Martin (Transparency International UK) |
| Abstract: | Governments and public international organizations are making a concerted effort to provide large amounts of money to reduce emissions of greenhouse gases (climate mitigation) or adapt to the effects of climate change (climate adaptation). But there is a significant risk that the infrastructure projects where much of this climate financing will need to be targeted will be undermined by corruption--from bribery and kickbacks to fraud and embezzlement. The threat is increased by the scale of the climate financing being provided and the speed with which the required projects need to be completed. This Policy Brief identifies key corruption risks that threaten climate infrastructure financing and the best practices that can alleviate these risks. |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:iie:pbrief:pb22-11&r= |
| By: | Pietsch, Allegra; Salakhova, Dilyara |
| Abstract: | The green bond market has increased rapidly in recent years amid growing concerns about climate change and wider environmental issues. However, whether green bonds provide cheaper funding to issuers by trading at a premium, so-called greenium, is still an open discussion. This paper provides evidence that a key factor explaining the greenium is the credibility of a green bond itself or that of its issuer. We define credible green bonds as those which have been under external review. Credible issuers are either firms in green sectors or banks signed up to UNEP FI. Another important factor is investors’ demand as the greenium becomes more statistically and economically significant over time. This is potentially driven by increased climate concerns as the green bond market follows a similar trend to that observed in ESG/green equity and investment fund sectors. To run our analysis, we construct a database of daily pricing data on closely matched green and non-green bonds of the same issuer in the euro area from 2016 to 2021. We then use Securities Holdings Statistics by Sector (SHSS) to analyse investors’ demand for green bonds. JEL Classification: G12, G14, Q50, A56 |
| Keywords: | climate change, corporate sustainability, impact investing, sustainable finance |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20222728&r= |
| By: | Dafermos, Yannis; Gabor, Daniela; Nikolaidi, Maria; van Lerven, Frank |
| Abstract: | Central bank collateral frameworks play a powerful role in contemporary market-based financial systems, affecting demand for financial assets and access to finance. However, existing collateral frameworks suffer from a carbon bias: they create disproportionately better financing conditions for carbon-intensive activities. This paper highlights the need to green the collateral frameworks and explores how central banks can incorporate environmental criteria into these frameworks. |
| JEL: | F3 G3 |
| Date: | 2022–08–08 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:116640&r= |
| By: | OECD |
| Abstract: | It is increasingly recognised that women and girls tend to be disproportionately impacted by climate change and other environmental challenges, especially in developing countries. Yet, little research or policy action has focused on how gender equality and environmental goals can be mutually reinforcing. This policy paper examines linkages and synergies between these two policy agendas and explores the role of green policies, finance and infrastructure in supporting women’s empowerment and gender equality. The paper finds that while the interlinkages that shape the gender-environment nexus are starting to be acknowledged, further efforts are needed to foster synergies between gender and environmental goals in policy design, sustainable finance approaches as well as in infrastructure planning and implementation. |
| Keywords: | climate action, ESG investing, gender equality, green finance, sustainable finance, sustainable infrastructure, women's empowerment |
| Date: | 2022–09–29 |
| URL: | http://d.repec.org/n?u=RePEc:oec:envaac:33-en&r= |
| By: | Mr. John C Bluedorn; Mr. Niels-Jakob H Hansen; Mr. Ippei Shibata; Marina M. Tavares; Diaa Noureldin |
| Abstract: | This paper builds a new set of harmonized indicators of the environmental properties of jobs using micro-level labor force survey data from 34 economies between 2005 and 2019 and analyzes the labor market implications of the green economic transition and environmental policies. Based on the new set of indicators, the paper's main findings are that greener and more polluting jobs are concentrated among smaller subsets of workers, individual workers rarely move from more pollution-intensive to greener jobs, and workers in green-intensive jobs earn on average 7 percent more than workers in pollution-intensive jobs. |
| Keywords: | Green jobs; Green Skills; Polluting jobs; Emissions; Environmental Regulation.; labor market implication; IMF working paper 2022/146; pollution intensity; green job; implications of the green; polluting job; Environmental policy; Employment; Labor markets; Climate change; Africa; Global; intensity score; emissions intensity; worker reallocation support; job-to-green job transition; pollution intensities of employment |
| Date: | 2022–07–22 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2022/146&r= |
| By: | George Thurston; Yewande Awe; Bart Ostro; Ernesto Sanchez-Triana |
| Keywords: | Environment - Air Quality & Clean Air Environment - Brown Issues and Health Environment - Pollution Management & Control |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:36269&r= |
| By: | Jian Xie; Wenyu Jia; Lelia Croitoru; Sarath Guttikunda; Jurg Grutter |
| Keywords: | Environment - Air Quality & Clean Air Environment - Brown Issues and Health Environment - Climate Change Mitigation and Green House Gases Environment - Pollution Management & Control Health, Nutrition and Population - Health Indicators Urban Development - Transport in Urban Areas |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:36287&r= |
| By: | Jurg Grutter; Wenyu Jia; Jian Xie |
| Keywords: | Transport - Transport Economics Policy & Planning Environment - Air Quality & Clean Air Environment - Brown Issues and Health Environment - Climate Change Mitigation and Green House Gases Urban Development - Transport in Urban Areas Environment - Pollution Management & Control |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:36286&r= |
| By: | Paige Weber; Matt Woerman |
| Abstract: | Renewable energy resources possess unique characteristics—intermittency and uncertainty— that pose challenges to electricity grid operations. We study these characteristics and find that uncertainty, represented by wind forecast error, has larger grid impacts than intermittency, or hourly generation changes. Uncertainty yields roughly double the price effects and roughly double the number of conventional generator start-ups, as compared to perfectly forecast wind. While this finding is important given the persistence of wind forecast error over the study period, reducing wind forecast error to the level of demand forecast error would lower costs by a modest half a million dollars per year. |
| Keywords: | renewable energy, electricity prices and price dispersion, electricity grid management |
| JEL: | Q40 Q42 Q47 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9902&r= |
| By: | Pablo Garcia Sanchez |
| Abstract: | I model two ways climate tail risk could threaten the resources available for consumption in an otherwise standard cake-eating problem. I show that precautionary behaviour is optimal, no matter how low the probability of catastrophic climate outcomes. |
| Keywords: | Climate change, Tail Risk, Tipping Point |
| JEL: | E20 Q50 |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:bcl:bclwop:bclwp164&r= |
| By: | Panle Jia Barwick; Dave Donaldson; Shanjun Li; Yatang Lin; Deyu Rao |
| Abstract: | The social costs of pollution and climate change hinge critically on humans’ ability to adapt. Based on transaction records from the world’s largest payment network, this research compiles daily travel flows and documents that China's rapid expansion of high-speed railways (HSR) facilitates the use of intercity travel as an effective adaptation strategy. Access to HSR reduces travelers' exposure to extreme air pollution and temperature by 7% and 10%, leading to substantial health benefits. These reductions are attributed to both contemporaneous responses to unexpected adverse conditions and also longer-horizon changes in travel patterns. |
| JEL: | O18 Q53 Q54 R41 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30462&r= |
| By: | Mats Kröger; Karsten Neuhoff; Jörn C. Richstein |
| Abstract: | Designing auctions that favor low resource quality installations allows countries to geographically diversify their renewable energy production, while lowering payments to low-cost producers. In this paper, we develop a stylized model showing that a discriminatory auction design favoring low-wind-yield locations leads to a tradeoff between production costs and producer rent and that the scheme can lower consumer costs even without considering the positive externalities of distributed generation. We explore the influence of the heterogeneity of production costs, the strength of the adjustment, and the regulator’s knowledge about cost structures. Through a numerical analysis of the German reference yield model, we estimate that at current auction levels intra-technology discrimination through the reference yield model leads to a reduction of consumer costs of around 24.8 billion Euro or 13% between 2023 and 2030. |
| Keywords: | Climate policy, auctions, renewable energy, onshore wind power, reference yield model |
| JEL: | D44 Q42 Q48 Q54 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp2013&r= |
| By: | Briglauer, Wolfgang; Köppl-Turyna, Monika; Schwarzbauer, Wolfgang |
| Abstract: | Digitization-related services and applications are based on the information and communications technology (ICT) ecosystem and encompass almost all areas of society and economic sectors nowadays and exert numerous opposing effects in regard to electricity consumption and corresponding CO2 emissions. Our analysis aims to inform policy decision makers about the actual climate relevance of the ICT ecosystem by providing sound empirical evidence on the net effect of various ICT core elements based on recent OECD panel data utilizing panel econometric estimation methods that include instrumental variables. We found that the CO2-reducing positive indirect effects seem to outweigh the negative, in other words, CO2-increasing direct and indirect effects on average. Specifically, we found that, in addition to the lowering effect related to the use of basic broadband connections, there was another lowering effect-albeit smaller-related to new fiber-based broadband connections. In contrast, other elements of the ICT ecosystem, such as mobile broadband networks or electronic end-user devices, showed no significant net impact on CO2 emissions. Our main findings suggest that broadband networks can give rise to positive environmental effects for society. We conclude that undifferentiated climate policy measures imposed on the ICT ecosystem would not do justice to the identified heterogeneity, with numerous in part opposing effects, and likely would be accompanied by inefficiencies and market distortions. |
| Keywords: | ICT,digitization,CO2 emissions,electricity consumption,OECD data,panel econometrics |
| JEL: | L52 L96 Q40 Q55 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:ecoarp:22&r= |
| By: | Antonio Cabrales; Manu García; David Ramos Muñoz; Angel Sánchez |
| Abstract: | We study the evolution of interest about climate change between different actors of the population, and how the interest of those actors affect one another. We first document the evolution individually, and then provide a model of cross influences between them, that we then estimate with a VAR. We find large swings over time of said interest for the general public by creating a Climate Change Index for Europe and the US (CCI) using news media mentions, and little interest among economists (measured by publications in top journals of the discipline). The general interest science journals and policymakers have a more steady interest, although policymakers get interested much later. |
| Keywords: | climate change, social norms, text analysis, social networks |
| JEL: | Q54 Q58 D85 A13 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9905&r= |
| By: | Olatunji A. Shobande (Teesside University, UK); Simplice A. Asongu (Yaoundé, Cameroon) |
| Abstract: | Generally, the revolutionary idea behind using information and communication technology (ICT) has improved potential productivity in many industries, particularly in Africa. ICT is an essential tool in the oil and gas industry and plays a complementary role in technological dynamics and cross-sectoral productivity. For the educational sector, ICT facilitates research and development as well as in imparting knowledge. ICT remains the password to essential inputs required for any given output in terms of improved productivity and economic development. With regard to employment creation, ICT accounts for more than 50% of employment globally. Despite the significant role of ICT in the economy, evidence shows that more than 90% of carbon emissions have been linked to ICT production, installation, and usage. This study aims to determine whether ICT causes environmental sustainability in Nigeria and South Africa. The methodological contribution of the study lies in combining the STIRPAT framework and time series based on the VAR/VEC Granger causality, enabling the study to uncouple the dynamic interaction among environmental sustainability indicators. The findings show that ICT has contributed to South Africa's environmental sustainability, whereas evidence in Nigeria is relatively mixed. Therefore, the study recommends the urgent need to provide intervention programs tailored toward investing in environmental infrastructure to mitigate the threat of climate change in Nigeria. |
| Keywords: | CO2 emissions; ICT; Economic development; Sub-Saharan Africa |
| JEL: | C52 O38 O40 O55 P37 |
| Date: | 2022–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:22/062&r= |
| By: | Mariia Murasheva; Maria A. Cunha-e-Sa |
| Abstract: | The effect of individual-level daily silicon dust exposure from cement production on the probability of hospital admissions for respiratory-related reasons is examined. The dataset was collected at the cement plant in Bryanskii region, Russia. We use an aerodynamic dispersion model to calculate pollutants’ exposure. We find significant impact of silicon dust on hospitalizations for children and elderly adults. We identify a non-linear response of the individual probability of hospital admissions to the average daily inhaled concentrations in the city area where exposure is higher. Our findings contribute to better inform policymakers aiming at reducing industrial air pollution exposure in Russia. |
| Keywords: | Ambient air pollution, Silicon dust exposure, High-frequency, Patient-level data, Dispersion model, Hospital admissions, Nonlinearity |
| JEL: | I10 Q51 Q53 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:unl:unlfep:wp652&r= |
| By: | Christian von Hirschhausen |
| Abstract: | Although plutonium has been studied by different disciplines (such as technology and innovation studies, political sciences) since its discovery, back in 1940 at the University of California (Berkeley), the resource and environmental economic literature is still relatively scarce; neither does the energy economic literature on nuclear power consider plutonium specifically, e.g. Davis (2012) or Lévêque (2014). However, interest in the topic is increasing, driven by a variety of factors: Thus, in the context of the low-carbon energy transformation and climate change mitigation, interest in non-light-water nuclear technology, including so-called “Generation IV” fast neutron reactor concepts and SMR (“small modular reactors”) non-light-water reactor concepts, supposedly to become competitive in some near time span, is rising, not only in Russia and China, but also in the US, Japan, Korea, and Europe (IAEA 2018; MIT 2018; Zhang 2020; Murakami 2021). This paper provides a review of resource and environmental economic issues related to plutonium, and presents insights from ongoing research. In particular, we ask whether after decades of unsuccessful attempts to use plutonium for electricity generation, resource and energy economic conditions have changed sufficiently to reverse this result. In the analytical framework, we explore determinants of the value of plutonium, by comparing it with the economics of the dominant nuclear energy, the light-water reactor (LWR) using a once-through fuel process. Three questions emerge and are addressed subsequently: i/ Can plutonium benefit from shortages and binding constraints on uranium supply for light-water nuclear power plants?; ii/ can future nuclear reactors developments become competitive through standardized mass production (“SMR”-reactors); and iii/ can plutonium be efficiently abated? The paper concludes that there are no indications of more favorable economic conditions for the commercial deployment of plutonium. |
| Keywords: | Nuclear power, uranium, plutonium, resources, economics, technology, innovation |
| JEL: | O33 Q53 Q47 L97 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp2011&r= |
| By: | Mélanie MARTEN (Université de Cergy-Pontoise, THEMA) |
| Abstract: | This paper investigates the effects of the 2014 French carbon tax reform on plant manufacturing energy use patterns and employment outcomes using a linear panel event study specification spanning fifteen years. The analysis exploits low-carbon electricity use to construct a proxy for exposure and expected exposure to increasingly higher carbon pricing, as the rate is set to reach e100 per tCO2 by 2030. A 10 percentage point (pp) increase in exposure is significantly associated with a 1.9 pp increase in the electricity share of fuel use, along with a 4.39% decrease in total energy use. Exposure is not associated with a change in electricity use levels, but is weakly associated with a drop in fossil fuel use: the electricity to fossil fuel use ratio increases by around 4.86 percent. Exposure is also weakly associated with job losses. |
| Keywords: | Carbon tax, Policy Evaluation, Manufacturing, France, Expectations. |
| JEL: | Q48 Q52 L6 D84 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ema:worpap:2022-19&r= |
| By: | Ankitha Nandipura Prasanna; Priscila Grecov; Angela Dieyu Weng; Christoph Bergmeir |
| Abstract: | The electricity industry is heavily implementing smart grid technologies to improve reliability, availability, security, and efficiency. This implementation needs technological advancements, the development of standards and regulations, as well as testing and planning. Smart grid load forecasting and management are critical for reducing demand volatility and improving the market mechanism that connects generators, distributors, and retailers. During policy implementations or external interventions, it is necessary to analyse the uncertainty of their impact on the electricity demand to enable a more accurate response of the system to fluctuating demand. This paper analyses the uncertainties of external intervention impacts on electricity demand. It implements a framework that combines probabilistic and global forecasting models using a deep learning approach to estimate the causal impact distribution of an intervention. The causal effect is assessed by predicting the counterfactual distribution outcome for the affected instances and then contrasting it to the real outcomes. We consider the impact of Covid-19 lockdowns on energy usage as a case study to evaluate the non-uniform effect of this intervention on the electricity demand distribution. We could show that during the initial lockdowns in Australia and some European countries, there was often a more significant decrease in the troughs than in the peaks, while the mean remained almost unaffected. |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2209.08885&r= |
| By: | Berkner, Andreas; Dähnhardt, Gesa; Falke, Jan; König, Angiola; Kynast, Kerstin; Lüdenbach, Karina; Müller, Vera; Renz, Alexandra; Schilling, Marion; Sehrig, Michael; Thieme, Tobias; Tschetschorke, Thomas; Ulmen, Gerit; Wisniewski, Sascha; Zettwitz, Wolfgang; Mayr-Bednarz, Barbara; Mölders, Tanja |
| Abstract: | Lignite planning in the Rhineland, central German and Lusatian coalfields is a core spatial development planning task at the federal state and regional levels. The Lignite Planning Information Group and Initiative (Informations- und Initiativkreis Braunkohlenplanung) was founded in 1994 at the ARL - Academy for Territorial Development in the Leibniz Association to provide a platform for expert discussion. Starting from experiences with the Rhineland and the structural upheavals in the new federal states in the early 1990s, it has since continuously addressed new technical and legal requirements involving resettlement, water balance issues, environmental assessments, the energy transition and the common good. Against the backdrop of rapid change and geopolitical events, the combination of structural change and the politically initiated phase-out of lignite-based power generation in a time frame between 'ideally 2030' and no later than the end of 2038 constitutes a challenge that will have to be met by the active players from the perspective of both federal state and regional planning and of regional development. This position paper takes stock of the situation across federal states and across coalfields and describes the required actions for lignite planning as a basis for reaching conclusions about a process with far-reaching national consequences. The various aspects of this process are subject to constant change and call for proactive strategies to exploit opportunities, tap potential, and effectively identify and avoid negative developments. |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:arlpos:140&r= |
| By: | 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); Moisei Ivanovich Zakharov (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); Jūratė Kamičaitytė (KTU - Kaunas University of Technology) |
| Abstract: | For the past ten years, energy issues – alongside the policies implemented to address them – have once again been at the heart of development issues in the Arctic and circumpolar regions. The reasons for this situation are based on the intensification of the exploitation of natural resources, for which the impacts of climate change (warming) are perceived as opportunities, thereby accelerating economic development and the reterritorialization of the Arctic space. The policies linked to the energy transition are driven by both ecology and the need to have autonomous production unit grids reinforcing the interrelations between territorial development and energy. Energy production units – whether wind, solar, gas, coal, nuclear, or sometimes hydroelectric – are key drivers of economic development in the Arctic and circumpolar space, determining the exploitation of future natural resources and human security. Without energy planning, there can be no economic growth, no human development, and no territorial development. Energy safety is fundamental for the territorial development of the Russian Arctic. The analysis of the Russian Arctic space by remote sensing shows intense urbanization processes accompanying the exploitation of natural resources. |
| Keywords: | Urbanisation,Energy,Territorial development,Arctic,Russian Federation |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03736971&r= |
| By: | Alec Brandon; Christopher M. Clapp; John A. List; Robert D. Metcalfe; Michael Price |
| Abstract: | Smart-home technologies have been heralded as an important way to increase energy conservation. While in vitro engineering estimates provide broad optimism, little has been done to explore whether such estimates scale beyond the lab. We estimate the causal impact of smart thermostats on energy use via two novel framed field experiments in which a random subset of treated households have a smart thermostat installed in their home. Examining 18 months of associated high-frequency data on household energy consumption, yielding more than 16 million hourly electricity and daily natural gas observations, we find little evidence that smart thermostats have a statistically or economically significant effect on energy use. We explore potential mechanisms using almost four million observations of system events including human interactions with their smart thermostat. Results indicate that user behavior dampens energy savings and explains the discrepancy between estimates from engineering models, which assume a perfectly compliant subject, and actual households, who are occupied by users acting in accord with behavioral economists’ conjectures. In this manner, our data document a keen threat to the scalability of new user-based technologies. |
| JEL: | D01 O10 Q4 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30482&r= |
| By: | Takanori Ida; Takunori Ishihara; Koichiro Ito; Daido Kido; Toru Kitagawa; Shosei Sakaguchi; Shusaku Sasaki |
| Abstract: | We develop an optimal policy assignment rule that integrates two distinctive approaches commonly used in economics—targeting by observables and targeting through self-selection. Our method can be used with experimental or quasi-experimental data to identify who should be treated, be untreated, and self-select to achieve a policymaker’s objective. Applying this method to a randomized controlled trial on a residential energy rebate program, we find that targeting that optimally exploits both observable data and self-selection outperforms conventional targeting for a utilitarian welfare function as well as welfare functions that balance the equity-efficiency trade-off. We highlight that the Local Average Treatment Effect (LATE) framework (Imbens and Angrist, 1994) can be used to investigate the mechanism behind our approach. By estimating several key LATEs based on the random variation created by our experiment, we demonstrate how our method allows policymakers to identify whose self-selection would be valuable and harmful to social welfare. |
| JEL: | C01 Q4 Q48 Q5 Q58 |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30469&r= |
| By: | Richard S.J. Tol; Richard S. J. Tol |
| Abstract: | Earlier meta-analyses of the economic impact of climate change are updated with more data, with three new results: (1) The central estimate of the economic impact of global warming is always negative. (2) The confidence interval about the estimates is much wider. (3) Elicitation methods are most pessimistic, econometric studies most optimistic. Two previous results remain: (4) The uncertainty about the impact is skewed towards negative surprises. (5) Poorer countries are much more vulnerable than richer ones. A meta-analysis of the impact of weather shocks reveals that studies, which relate economic growth to temperature levels, cannot agree on the sign of the impact whereas studies, which make economic growth a function of temperature change do agree on the sign but differ an order of magnitude in effect size. The former studies posit that climate change has a permanent effect on economic growth, the latter that the effect is transient. The impact on economic growth implied by studies of the impact of climate change is close to the growth impact estimated as a function of weather shocks. The social cost of carbon shows a similar pattern to the total impact estimates, but with more emphasis on the impacts of moderate warming in the near and medium term. |
| Keywords: | climate change, weather shocks, economic growth, social cost of carbon |
| JEL: | O44 Q54 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9919&r= |
| By: | Alexander Ioannidis |
| Abstract: | This paper summarises the approach taken by the Commission during the Economic Adjustment Programmes to address reforms to Greece’s energy market. It will argue that it was necessary address the sector as part of the programme, and to make energy-related reforms part of the conditionality applied to post-programme surveillance, underlined bv the Eurogroup commitments. The paper will explain how the Greek energy sector looked at the outset of the programme, which problems were seen as priorities to be tackled, and how such reform efforts developed. With a lack of competition and poorly functioning markets, necessary investments were not taking place, particularly in the context of the EU’s ambitious climate and energy goals. The paper will aim to show that over the years, the programmes were effective in contributing to real structural improvements in the energy markets. Today, the Greek energy sector is greener and more open to competition. Such reforms, with a focus on developing the renewable energy sector, proved to be aligned with the general direction of EU policy, shown by events after the programme such as the European Green Deal and the COVID recovery package, the Recovery and Resilience Facility, which put an emphasis on sustainable investments. The state of the energy sector has an impact on a country’s growth and competitiveness, both in its own right and for sectors that heavily rely on energy inputs. From a social aspect, energy poverty is an important issue to consider. Before entering the macroeconomic adjustment programmes, the Greek energy market was much less developed than that of its EU peers, not as open to competition and lacking investment. Given the importance of energy markets to the wider economy, it was found that a reform programme should also place focus on this area. With this in mind, this paper will argue that the programme was right to put efforts into a systematic reform of the Greek energy market. It will argue that those reforms, sometimes implemented in a different manner to how they were originally envisaged, made good progress, which helped the energy market from both an economic and environmental/climate perspective, with benefits for wider society. The information provided in this paper was used as an input for the ex-post evaluation of the Greek adjustment programmes during the period 2010-2018. The cut-off date of this paper was mid-2021. |
| JEL: | L33 Q40 |
| Date: | 2022–07 |
| URL: | http://d.repec.org/n?u=RePEc:euf:dispap:166&r= |
| By: | Juárez-Luna, David; Urdiales, Eduardo |
| Abstract: | This paper aims to identify specific policies that promote the participation of installed PV capacity in Mexico's energy basket. We apply a benchmarking analysis, which provides a comparative perspective between Mexico and the countries with the highest installed PV capacity in the world. The analysis suggests that, in order to boost the participation of installed PV capacity, a long-term planning of the Mexican PV industry should be carried out, with Smart Electric Grids as the leading principle, focusing on PV electricity. In such plan, the starting point should consist of implementing four policies: a) capital subsidy, concession or rebate; b) tax credit for investment or production; c) public investment, and; d) the promotion of research and development of PV technology. |
| Keywords: | Photovoltaic electricity, Energy policies, Benchmarking, Energy planning, Smart electrical grids. |
| JEL: | Q40 Q42 Q48 |
| Date: | 2021–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:114589&r= |
| By: | Bart Ostro; Yewande Awe; Ernesto Sanchez-Triana |
| Keywords: | Environment - Air Quality & Clean Air Environment - Brown Issues and Health Environment - Climate Change and Environment Environment - Pollution Management & Control |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wboper:36267&r= |
| By: | Wolf Rogowski; Wolfram Elsner |
| Abstract: | In economic research about climate change mitigation, there is a tension between the objectives to ensure scientific rigor (focusing on orthodox theory) and to illuminate blind spots of relevance (drawing on different "heterodox" theories). Our aim is to develop an economic perspective on climate change mitigation which considers both objectives. We conduct a critical literature review, searching for coherent economic theory lattices, which meet the requirements of research programs, i.e. contain a pre-analytic vision, an analytical core including a concept of rationality, and examples of applications in empirical research. We develop a framework structuring these research programs and associated research fields and search for examples illustrating their applicability to climate change mitigation. We identify several research fields within four major research programs that perceive economic phenomena as (1) individual optimization decisions (neoclassical analysis of efficient and of inefficient equilibria and behavioral economics); (2) a set of institutions (New and Original institutional economics); (3) a complex evolutionary system (Biophysical and Evolutionary economics); and (4) an objective function (which can guide research focusing on the content or the distribution of the normatively defined units of interest). For each research program and its subdivisions, we present theoretical elements and illustrate how they can improve our understanding of how economic activity contributes to climate change and how these impacts can be alleviated. There is a need for more systematic evidence synthesis to validate the contributions of the different economic research fields and to improve their selection and application to climate change. |
| Keywords: | Climate change, neoclassical economics, behavioral economics, economic heterodoxies, evolutionary economics, institutional economics, objective functions, research programs, policy implications. |
| JEL: | A11 A12 B5 H41 Q54 |
| Date: | 2021–08 |
| URL: | http://d.repec.org/n?u=RePEc:atv:wpaper:2106&r= |
| By: | Thang Dao; Matthias Kalkuhl; Chrysovalantis Vasilakis |
| Abstract: | This paper considers the persistent effects of climate change on the speed of demographic transition, and hence on the size of the population in regions that are the least developed and the most vulnerable to climate change, such as Sub-Saharan Africa. These effects are transmitted through interactions between the education gender gap within families, fertility, and the local environment, through which the demographic transition is delayed. Environmental conditions affect intra-household labor allocation because of the impacts on local resources under the poor infrastructural system. Examples include the collection of essential resources, e.g. clean water and firewood, by women for their families’daily lives. Climate change causes damage to local resources, offsetting (partially) the role of technological progress and infrastructure investment in saving time that women spend on their housework duties. Hence, the gender inequality in education/income is upheld, delaying declines in fertility and creating population momentum. The bigger population, in turn, degrades local resources and the environment through expanded production. The interplay between local resources, gender inequality, and population, under the persistent effect of climate change, may thus generate a slow demographic transition and stagnation of the least developed regions. We provide empirical confirmation for our theoretical predictions using data from 44 African countries in the period from 1960 to 2017. |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:dpr:wpaper:1190&r= |
| By: | Frikk Nesje; Moritz A. Drupp; Mark C. Freeman; Ben Groom |
| Abstract: | The estimated values to society from long-term public projects, including climate change mitigation and infrastructure construction, are highly sensitive to the social discount rate (SDR) employed. Governmental guidance on social discounting has predominantly been based on input from expert economists. It is not clear, however, that economists possess any special expertise on the ethical issues that underpin long-term societal decision-making. This study compares expert economists’ views on key components of the long-term SDR with those of a disciplinary group of experts who may be deemed most trained on ethical matters: philosophers. The results indicate that both expert groups provide surprisingly similar recommendations on these components and on the SDR itself, with a real SDR recommendation of 2% receiving most support in both disciplines. An analysis of qualitative remarks shows areas of broad agreement and yet distinct differences in rationales. While economists provide numerous technical extensions within a consequentialist Discounted Utilitarian approach, philosophers advocate more strongly for alternative ethical approaches to standard Utilitarian calculus. In the politicized world of long-term decision-making, this paper illustrates how more inclusive and deliberative approaches to complex issues such as intergenerational justice can guide more nuanced decision-making today and lead to multidisciplinary support for climate action. |
| Keywords: | intergenerational social discounting, expert survey, philosophy, economics, climate policy |
| JEL: | C83 D61 H43 Q58 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_9930&r= |
| By: | Roberto Baviera; Pietro Manzoni |
| Abstract: | A Recurrent Neural Network that operates on several time lags, called an RNN(p), is the natural generalization of an Autoregressive ARX(p) model. It is a powerful forecasting tool when different time scales can influence a given phenomenon, as it happens in the energy sector where hourly, daily, weekly and yearly interactions coexist. The cost-effective BPTT is the industry standard as learning algorithm for RNNs. We prove that, when training RNN(p) models, other learning algorithms turn out to be much more efficient in terms of both time and space complexity. We also introduce a new learning algorithm, the Tree Recombined Recurrent Learning, that leverages on a tree representation of the unrolled network and appears to be even more effective. We present an application of RNN(p) models for power consumption forecasting on the hourly scale: experimental results demonstrate the efficiency of the proposed algorithm and the excellent predictive accuracy achieved by the selected model both in point and in probabilistic forecasting of the energy consumption. |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2209.01378&r= |
| By: | Luca Aiello; Matteo Fontana; Alessandra Guglielmi |
| Abstract: | We propose a statistical emulator for a climate-economy deterministic integrated assessment model ensemble, based on a functional regression framework. Inference on the unknown parameters is carried out through a mixed effects hierarchical model using a fully Bayesian framework with a prior distribution on the vector of all parameters. We also suggest an autoregressive parameterization of the covariance matrix of the error, with matching marginal prior. In this way, we allow for a functional framework for the discretized output of the simulators that allows their time continuous evaluation. |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2209.05767&r= |
| By: | Artjom Janssen; Justin Dijk; Patty Duijm |
| Abstract: | Financial institutions need robust statistics to measure and manage climate-related risks and determine their sustainability improvements over time The physical effects of climate change, such as more frequent and severe floods and extreme weather, can have a major impact on the financial risks facing the financial sector. The transition to a more sustainable economy can also lead to so-called transition risks. Due to climate policy, technological developments and changing consumer preferences, current investments in companies with relatively large greenhouse gas emissions can decrease in value faster than expected. At the same time, the investment choices made by the financial sector can ensure that sufficient capital is made available for the investments needed to achieve the goals of the Paris Agreement. The development of robust climate change statistics to measure both risk and impact is a key priority at DNB. Improving our confidence in backward-looking metrics such as carbon disclosure metrics, enables central banks and supervisors to determine the transition risks facing the financial sector, whether the financial sector is on the right track toward reaching its sustainability goals, and ensures that forward-looking tools such as scenario analysis and stress tests use better historical information to estimate financial risks. |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:dnb:dnbocs:1901&r= |
| By: | Walch, Florian; Breitenstein, Miriam; Ciummo, Stefania |
| Abstract: | Climate change can be a source of financial risk. This paper examines how credit rating agencies accepted by the Eurosystem incorporate climate change risk in their credit ratings. It also analyses how rating agencies disclose their assessments of climate change risks to rating users. The paper develops an analytical framework to compare the agencies’ definitions, methodologies, assessment models, data usage and disclosure practices. The paper reveals large differences in methodologies and disclosure practices across rating agencies and asset classes. The authors identify three main areas for improvement with respect to climate-related disclosures. These areas concern the level of granularity of definitions of climate change risk, the transparency around models and methods used to estimate the exposure to climate change risk and the disclosure of the magnitude of the impact of material climate change risk on credit ratings. JEL Classification: E52, E58, G24, G32, Q54 |
| Keywords: | climate change, credit rating agencies., credit risk, monetary policy, risk management |
| Date: | 2022–09 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbops:2022303&r= |
| By: | Katharina Friz |
| Abstract: | Environmental innovation (EI) plays an important role in decoupling economic growth and environmental harm. This paper focuses on the environmental innovation behavior of companies in transition countries of Eastern Europe and Central Asia, which have been little studied so far. These countries share the Soviet legacy of environmental mismanagement, and have restructured their innovation systems relatively recently in the course of transition. The EBRD-EIB-WB Enterprise Survey (2018-2020) allows us to examine the determinants of environmental innovation in 29 transition countries. Although the theory places a greater emphasis on external sources of knowledge in EI, the results indicate that collaborative R&D is still quite weak in these countries. Moreover, environmental regulation increases the likelihood of adopting energy efficiency measures, while customers demanding environmental standards increase the likelihood across all innovation activities, indicating an increasing sustainability awareness among consumers. |
| Keywords: | Environmental innovation, transition economies, firm-level data, logit model |
| JEL: | O12 O31 O32 O5 Q55 |
| Date: | 2021–09 |
| URL: | http://d.repec.org/n?u=RePEc:atv:wpaper:2107&r= |