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on Energy Economics |
| By: | Benjamin Carton; Christopher Evans; Mr. Dirk V Muir; Simon Voigts |
| Abstract: | This paper presents GMMET, the Global Macroeconomic Model for the Energy Transition, and provides documentation of the model structure, data sources and model properties. GMMET is a large-scale, dynamic, non-linear, microfounded multicountry model whose purpose is to analyze the short- and medium-term macroeconomic impact of curbing greenhouse gas (GHG) emissions. The model provides a detailed description of GHG-emitting activities (related to both fossil fuel and non-fossil-fuel processes) and their interaction with the rest of the economy. To better capture real world obstacles of the energy transition, GMMET features a granular modelling of electricity generation (capturing the intermittency of renewables), transportation (capturing network externalities between charging stations and electric vehicle adoption), and fossil fuel mining (replicating estimated supply elasticities at various time horizons). The model also features a rich set of policy tools for the energy transition, including taxation of GHG emissions, various subsidies, and regulations. |
| Keywords: | Climate mitigation policy; policy coordination |
| Date: | 2023–12–22 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2023/269&r=ene |
| By: | Behrang Shirizadeh (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique); Philippe Quirion (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | We model the optimal hydrogen and electricity production and storage mix for France by 2050. We provide a central scenario and study its sensitivity to the cost of electrolyzers, the hydrogen demand and the renewable energy deployment potential. The share of electrolysis vs. methane reforming with CO 2 capture and storage in hydrogen production is sensitive to the cost of electrolyzers, with the former providing around 60% in the central scenario. However, the system cost and hydrogen and electricity production costs are much less sensitive to these scenarios, thanks to the wide nearoptimal feasible space of the solutions. The electricity production mix is almost fully renewable in the central scenario, while nuclear has a significant role only if the wind & solar potential limits their deployment, or if blue hydrogen is not authorized. |
| Keywords: | Power system modelling, electricity markets, low-carbon hydrogen, levelized cost of hydrogen, green hydrogen, blue hydrogen, large-scale renewable integration, renewable energies, prospective planning, optimization |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-04347126&r=ene |
| By: | Sarode, Shruti MS; Segal, Katie MPP; Elkind, Ethan JD |
| Abstract: | California's goal to eliminate internal combustion engine sales by 2035 poses challenges for lower- and moderate-income residents, hindering their access to electric vehicles (EVs). Barriers include limited EV charging stations, exacerbated by lower home ownership and inadequate grid infrastructure in lower-income communities. To address this, UC Berkeley School of Law's Center for Law, Energy & the Environment (CLEE) partnered with the City of Watsonville. Due to its location, demographics, and ambitious policy goals, Watsonville represents a potential model and case study for other cities around the state grappling with how to boost EV charging infrastructure. CLEE conducted stakeholder interviews and a convening in Watsonville in May2023, and developed a set of policy recommendations for both state and local entities to accelerate investment in EV charging infrastructure in Watsonville, which could inform other cities facing similar challenges and seeking to meet state targets and residents’ needs. |
| Keywords: | Law, Electric vehicle charging, electric vehicles, zero emission vehicles, low income groups, underserved communities, policy analysis |
| Date: | 2023–12–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsrrp:qt6r1147v7&r=ene |
| By: | Ramaharo, Franck Maminirina (Ministry of Economy and Finance (Ministère de l'Economie et des Finances)); Razanajatovo, Yves Heritiana Mihaja (Ministry of Economy and Finance (Ministère de l'Economie et des Finances)); Ravelomanantsoa, Fabienne Mahefatiana; Ramarosandratana, Saotra Finiavana Melodia; Aljaona, Emanuella Miora (Ministère de l'Economie et des Finances) |
| Abstract: | This study investigates the impact of energy demand on Madagascar's economic growth from 2007Q1 to 2022Q4. Drawing upon a rich dataset from Malagasy sources, we applied the ARDL bounds testing approach and found cointegration among the series. We found that, in the long run, electricity and petroleum consumption have positive significant effects on economic growth, while energy imports and global prices have negative significant effects. We further applied Granger-causality test based on Error Correction Model to examine causal relationships. The results revealed that in the short run, there are unidirectional causal effects running from electricity consumption, energy imports, and global prices to economic growth. The test also revealed that both energy demand and global prices have a long-run causal effect on economic growth. Our findings confirms that Madagascar is an energy-dependent economy, and provide valuable insights for policymakers to design effective energy policies that promote economic growth and energy security. |
| Date: | 2024–01–06 |
| URL: | http://d.repec.org/n?u=RePEc:osf:africa:xwktc&r=ene |
| By: | Kohnert, Dirk |
| Abstract: | Since Russia's war in Ukraine, many European countries have been scrambling to find alternative energy sources. One of the answers was to increase imports of liquefied natural gas (LNG). By bypassing the use of pipelines from the East and by building LNG terminals, the EU opened up a wider variety of potential suppliers. The Europe-Africa Energy and Climate Partnership provides a framework for a win-win alliance. African countries will be key players in the future, including sub-Saharan countries such as Nigeria, Senegal, Mozambique and Angola. According to the REPowerEU plan, hydrogen partnerships in Africa will enable the import of 10 million tons of hydrogen by 2030, replacing about 18 billion cubic meters of imported Russian gas. Algeria, Niger and Nigeria recently agreed to build a 4, 128-kilometer trans-Saharan gas pipeline that would run through the three countries to Europe. Once completed, the pipeline will transport 30 billion cubic meters of gas per year. The African Coalition for Trade and Investment (ACTING) estimates potential sub-Saharan LNG export capacity at 134 million tonnes of LNG (approximately 175 billion m3) by 2030. Sub-Saharan Africa is also expected to become the main producer of green hydrogen by 2050. However, this market remains to be developed and requires significant expansion of renewable production and water availability. However, the EU countries and companies involved would be well advised to take note of the adoption of much stricter EU greenhouse gas reduction targets for 2030 and the publication of the European Commission's methane strategy. That being said, the EU could risk having more than half of Europe's LNG infrastructure idle by 2030, as European LNG capacity in 2030 exceeds total forecast gas demand, including LNG and pipeline gas. Regardless, it should not be forgotten that African countries want and need to develop their domestic gas markets as a priority, and that export potential depends on this domestic development. However, LNG alone is not enough to ensure the resilience of the system in the event of a supply failure. Alternative energy sources and energy conservation remain essential. |
| Keywords: | LNG; Hydrogen economy; e-fuels; LNG terminals; Natural gas; Energy security; Gas storage; Sub-Saharan Africa; EU; REPowerEU; Trans-Saharan gas pipeline; emerging markets; Sonatrach; European Green Deal; African Continental Free Trade Agreement; Eni; TotalEnergies; BP; Nigeria; Angola; Mozambique; Tanzania; Senegal; Cameroon; Equatorial Guinea; Namibia; African Studies; |
| JEL: | E22 E23 F13 F18 F23 F35 F54 L71 L95 N57 N77 O13 Q35 Z13 |
| Date: | 2023–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:119402&r=ene |
| By: | Kasyanova, Ksenia (Касьянова, Ксения) (The Russian Presidential Academy of National Economy and Public Administration) |
| Abstract: | The Russian wholesale electricity market is divided into two price zones: the European (first) price zone and the Siberian (second) price zone. The pricing mechanisms in the first and second price zones are the same: within each price zone, there is a free competition market between producers, which is provided by a significant transmission capacity of the electrical network. At the same time, the flow between the price zones is insignificant, and the equilibrium prices differ to a large extent, since competitive bidding for electricity and capacity is held separately for each price zone. During the analysis of the spot prices by the price zones a two-level model of stochastic volatility was developed. It was already shown that the dynamics of electricity prices are significantly different in the European and Siberian price zones. The transition to the analysis of reginal prices allows to identify the possible causes of these differences. In particular, one of the analysis tools is the construction of linear regressions of estimates of the coefficients of the stochastic volatility model (calculated for each node/region) on the permanent region’s characteristics (geographical location of the region, shares of TPPs, NPPs and HPPs in the power generation structure, shares TPPs operating on gas and coal, the share of the main sectors of GRP). As a result of evaluating the models for the region-averaged node prices, the differences in average prices, weekly price dynamics, the effect size of holidays, heating degree-days and volumes of industrial production on prices between regions were explained. Analysis of node prices based on regional maps makes it possible to detect weaknesses in the infrastructure of the electric power industry and regions with anomalous dynamics of electricity prices. |
| Keywords: | Electricity prices, spot energy market, Bayesian inference, stochastic volatility |
| Date: | 2022–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:wpaper:w20220290&r=ene |
| By: | Sileo, Antonio; Bonacina, Monica |
| Abstract: | This paper studies the effects of the latest European regulations on carbon emissions on the Italian car market and discusses the possibility of achieving climate neutrality of road transport through the “mere” replacement of cars currently on the road with new zero-emission cars. Since 2016, automakers’ production strategies have changed dramatically, with an increasing number of zero (and low) emission models on car lists. To date, these changes on the supply side have not been matched by similar changes in purchasing habits. In recent years, not only have few zero (and low) emission cars been sold, but also few new cars. Unless epoch-making changes occur, it is completely unrealistic to think that we can achieve climate neutrality by 2050 by leveraging exclusively on the renewal of the fleet. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2024–01–15 |
| URL: | http://d.repec.org/n?u=RePEc:ags:feemwp:339238&r=ene |
| By: | Davide Pace (LMU Munich); Taisuke Imai (Osaka University); Peter Schwardmann (Carnegie Mellon University); Joel van der Weele (Tinbergen Institute) |
| Abstract: | With a large representative survey (N=1, 128), we document that consumers are very uncertain about the emissions associated with various actions, which may affect their willingness to reduce their carbon footprint. We experimentally test two channels for the behavioural impact of such uncertainty, namely risk aversion about the impact of mitigating actions and the formation of motivated beliefs about this impact. In two large online experiments (N=2, 219), participants make incentivized trade-offs between personal gain and (uncertain) carbon impact. We find no evidence that uncertainty affects individual climate change mitigation efforts through risk aversion or motivated belief channels. The results suggest that reducing consumer uncertainty through information campaigns is not a policy panacea and that communicating scientific uncertainty around climate impact need not backfire. |
| Date: | 2023–12–02 |
| URL: | http://d.repec.org/n?u=RePEc:rco:dpaper:470&r=ene |
| By: | Stefano Carattini; Giseong Kim; Givi Melkadze; Aude Pommeret |
| Abstract: | Ambitious climate policy, coupled with financial frictions, has the potential to create macrofinancial stability risk. Such stability risk may expand beyond the economy implementing climate policy, potentially catching other countries off guard. International spillovers may occur because of trade and financial channels. Hence, we study the design and effects of climate policies in the world economy with international trade and financial flows. We develop a two-sector, two-country, dynamic general equilibrium model with financial frictions, climate policies, including carbon tariffs, and macroprudential policies. Using the calibrated model, we evaluate spillovers from unilateral domestic carbon pricing to foreign economies and back. We also examine more ambitious climate architectures involving carbon tariffs or a global carbon price. We find that accounting for cross-border financial flows and frictions in credit markets is crucial to understand the effects of climate policies and to guide the implementation of macroprudential policies at the global scale aimed at minimizing transition risk and paving the way for ambitious climate policy. |
| Keywords: | financial frictions, carbon tax, carbon tariffs, open economy |
| JEL: | E44 E58 F38 F42 G18 Q58 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_10851&r=ene |
| By: | Giovanni Carnazza (Department of Economics and Management, University of Pisa); Thomas I. Renström (Department of Economics and Management, Centre for Environmental and Energy Economics, Durham University); Luca Spataro (Department of Economics and Management, University of Pisa) |
| Abstract: | The EU has embarked on multiple initiatives reflecting its commitment to environmental enhancement and sustainable transitions. Notable among these are the European Green Deal and the NextGenerationEU recovery plan, both pivotal in fostering eco-friendly policies and sustainable practices within the region. Conversely, the fiscal rules within the EU, designed to manage budgetary deficits and debt-to-GDP ratios, may pose challenges to the implementation of fiscal measures targeted at achieving environmental quality objectives. These regulatory constraints potentially curtail the fiscal space available for policies aligned with the environmental goals set forth by the EU. To address this issue, using a panel of 27 European member countries observed annually from 1995 to 2021, we investigate the impact of two different indicators on the overall carbon intensity: on the one hand, the implicit tax rate on energy reduces environmental pollution; on the other hand, an increase in the stringency of the European fiscal framework and/or the debt-to-GDP ratio increase carbon intensity. From a policy point of view, our outcomes stress the importance of shaping national and European regulations to foster more sustainable environmental development. |
| Keywords: | Fiscal Rules, European Union, Energy taxes, CO2 emissions, Government debt |
| JEL: | H23 H63 H87 Q53 Q58 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2023.26&r=ene |
| By: | Lise Desvallées (LATTS - Laboratoire Techniques, Territoires et Sociétés - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - Université Gustave Eiffel) |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03456394&r=ene |
| By: | Mike Ludkovski; Saad Mouti; Glen Swindle |
| Abstract: | We consider the construction of renewable portfolios targeting specified carbon-free (CFE) hourly performance scores. We work in a probabilistic framework that uses a collection of simulation scenarios and imposes probability constraints on achieving the desired CFE score. In our approach there is a fixed set of available CFE generators and a given load customer who seeks to minimize annual procurement costs. We illustrate results using a realistic dataset of jointly calibrated solar and wind assets, and compare different approaches to handling multiple loads. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2312.07733&r=ene |
| By: | Devine, Mel; Lynch, Muireann à |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:esr:wpaper:wp766&r=ene |
| By: | Navarro, Adoracion M. |
| Abstract: | The recent calls to review the Oil Price Stabilization Fund (OPSF) are seen as a policy reversal of the downstream oil industry deregulation. The OPSF’s history reveals lessons, as petroleum price setting and using the fund resulted in mismatches and subsidies from the national budget. Policymakers faced challenges in adhering to the OPSF’s purpose, leading to price distortions and cross subsidization. Despite global trends toward removing fossil fuel subsidies, some countries with stabilization funds struggle to sustain operations. The current oil crisis triggered by the Russia-Ukraine war raises questions about deregulation, but the suggestion is to focus on reform durability rather than policy reversal. A dedicated communication campaign is proposed to educate the public about deregulation’s premise and promises. Policymakers are urged to commit to legislative amendments that improve, rather than reverse, reforms. |
| Keywords: | Oil Price Stabilization Fund;oil price regulation;downstream oil industry deregulation;policy reversal;price unbundling;strategic oil reserves;fossil fuel subsidies |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:phd:pjdevt:pjd_2023_vol__47_no__2b&r=ene |
| By: | Christian P. Fries |
| Abstract: | We show that the so called social cost of carbon (SCC(t)) will not cover the cost induced by climate change (damage cost and abatement cost) if it would be used as a CO$_2$-price. We define an implied CO$_2$-price that would cover the climate change induced costs. The price can be interpreted as a \textit{polluter pays principle}. A numerical analysis using a classical DICE model reveals that the cost-implied CO$_2$ price is around 550 $\$$/tCO$_2$, while the corresponding price associated with the SCC is around 50 $\$$/tCO$_2$. |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2312.13448&r=ene |
| By: | Gugler, Klaus; Szücs, Florian; Wiedenhofer, Thomas |
| Abstract: | This article evaluates if and to which extent policy can steer innovation towards eco-friendly technologies. We construct a cross-country dataset on sectoral green innovation and complement it with data on policies designed to address environmental market failures: environmental taxes, regulation, and R&D subsidies. While all of these tools exert a positive effect on green innovation, our IV estimates reveal substantial heterogeneities across policies. Overall, green innovation reacts most strongly to R&D subsidies for renewables, but interaction effects between different policies need to be considered. |
| Keywords: | climate change; environmental policies; directed technological change; green patents; regulation; taxes; R&D |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:wiw:wus005:59343718&r=ene |
| By: | Mozgovaya, Oksana (Мозговая, Оксана) (The Russian Presidential Academy of National Economy and Public Administration); Phain, Boris (Файн, Борис) (The Russian Presidential Academy of National Economy and Public Administration); Tyomnaya, Olga (Темная, Ольга) (The Russian Presidential Academy of National Economy and Public Administration); Kuznetsov, Vasily (Кузнецов, Василий) (The Russian Presidential Academy of National Economy and Public Administration) |
| Abstract: | The aim of this research is valuation the impact of comparative method regulation to the financial results of default electricity suppliers and prepare practical recommendations for improving the methodology of comparative method regulation usage. The research tasks are methodology establishment and estimation of the comparative method regulation effects for default electricity supplier’s financial results, and preparing recommendations for the comparative method optimization. The thematic justification consists in necessity to evaluate the practical results of comparative method implication in different aspects of default electricity supplier’s financial results and further development of the comparative method as part of Russian Energy strategy 2035 and realization of tariff transparency policy. The research methods include factor and data analysis, as well as financial analysis. Information (including financial reports) published by default electricity suppliers in accordance with the information disclosure standards was used as the information base of the research. The scientific novelty of the study is establishment and practical approval of methodology of estimation of the comparative method regulation effects for default electricity supplier’s financial results and prepare recommendations for the comparative method optimization. According to the results of the research the increasement of the big part of default electricity suppliers’ financial stability after transition to the comparative method in activity regulation of default electricity suppliers have been revealed. Prospects for further work on the subject of the study are to develop a methodology for reference regulation in other areas of regulated activity. |
| Keywords: | sales markups, guaranteed (default) electricity supplier, tariff policy, financial results, financial condition, method of analogues comparison, yardstick regulation, electricity retail market |
| JEL: | E64 L94 |
| Date: | 2022–11–10 |
| URL: | http://d.repec.org/n?u=RePEc:rnp:wpaper:w20220294&r=ene |
| By: | Arpita Ghosh (Department of Economics, University of Exeter); Brendon McConnell (Department of Economics, City University of London); Jaime Millán-Quijano (Navarra Center for International Development, Universidad de Navarra) |
| Abstract: | We study the housing market response to a country-wide policy that mandated the provision of energy efficiency information with all marketing material at the time of listing. Using the near universe of housing sales in England and Wales, we match in the energy efficiency status of the property from Energy Performance Certificates data. We develop a conceptual framework that makes clear the key channels through which the policy may impact house prices - an information-driven salience channel and a market valuation channel. We provide causal evidence of homebuyers' willingness to pay for a higher energy rated property, documenting a 1-3% premium to a higher energy efficiency rating at the national level, and a 3-6% premium in the London market. We explore a set of key margins along which homebuyers can respond, ruling out as explanations both a consumption channel and an information channel. We conclude that the elevated EPC-rating premiums are driven by a market valuation channel, a conclusion for which we provide empirical support. Such a conclusion is of key policy importance, as it suggests market-facing energy efficiency regulations can increase demand for more energy efficient housing, even in absence of any discernible demand-side consumption or information effects. |
| Keywords: | hedonic price models, energy performance certificates, real estate |
| JEL: | R38 Q48 K32 |
| Date: | 2024–01–16 |
| URL: | http://d.repec.org/n?u=RePEc:exe:wpaper:2401&r=ene |
| By: | Jonathan Colmer; David Lagakos; Martin Shu |
| Abstract: | This paper asks whether increasing productivity in the electricity sector can yield larger long-run GDP gains than suggested by electricity's small share of aggregate economic activity. We answer this question using a dynamic model in which electricity is a strong complement to other inputs in production. We parameterize the model using our own new measures of electricity-sector TFP across countries. The model predicts modest long-run GDP gains from improving electricity-sector TFP, contrary to the notion that electricity is a weak link. Parameterizations that make electricity a weak link mostly require the electricity sector to be counterfactually large or unproductive. |
| Keywords: | electricity, economic development, weak link, TFP |
| Date: | 2024–01–03 |
| URL: | http://d.repec.org/n?u=RePEc:cep:cepdps:dp1970&r=ene |
| By: | Rashid, Redowan |
| Abstract: | This article examines the moral aspects of greenhouse gas emissions, climate change, and the developing field of greenhouse gas removal (GGR). This text highlights the importance of urgently tackling climate change in accordance with ethical standards. It explores the ethical dilemmas presented by global warming, with a particular focus on the unequal impact it has on disadvantaged communities. The statement delineates six fundamental ethical principles, drawing upon UNESCO's guidelines on climate change. These principles encompass the avoidance of harm, the adoption of a precautionary approach, the promotion of equality and justice, the pursuit of sustainable development, the fostering of solidarity, and the incorporation of scientific information in decision-making. The study addresses three primary ethical dilemmas associated with greenhouse gas emissions, specifically emphasizing the need for international collaboration, the long-term consequences for future generations, and the insufficiency of existing theoretical frameworks. Furthermore, it examines the connection between greenhouse gas emissions and social justice, highlighting the importance of considering fairness and equality in climate action. The concluding segment scrutinizes the ethical dilemmas of GGR, emphasizing the societal, moral, and governmental apprehensions linked to these nascent technologies. |
| Date: | 2023–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:szh8q&r=ene |
| By: | Molitor, David (University of Illinois at Urbana-Champaign); White, Corey (Monash University) |
| Abstract: | Do environmental conditions pose greater health risks to individuals living in urban or rural areas? The answer is theoretically ambiguous: while urban areas have traditionally been associated with heightened exposure to environmental pollutants, the economies of scale and density inherent to urban environments offer unique opportunities for mitigating or adapting to these harmful exposures. To make progress on this question, we focus on the United States and consider how exposures—to air pollution, drinking water pollution, and extreme temperatures—and the response to those exposures differ across urban and rural settings. While prior studies have addressed some aspects of these issues, substantial gaps in knowledge remain, in large part due to historical deficiencies in monitoring and reporting, especially in rural areas. As a step toward closing these gaps, we present new evidence on urban-rural differences in air quality and population sensitivity to air pollution, leveraging recent advances in remote sensing measurement and machine learning. We find that the urban-rural gap in fine particulate matter (PM2.5) has converged over the last two decades and the remaining gap is small relative to the overall declines. Furthermore, we find that residents of urban counties are, on average, less vulnerable to the mortality effects of PM2.5 exposure. We also discuss promising areas for future research. |
| Keywords: | environment, urban, rural, pollution, health |
| JEL: | I10 Q53 Q54 |
| Date: | 2023–12 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp16678&r=ene |
| By: | Jahen F. Rezki; Roes Regi Lutfi; Yoshua Caesar Justinus (Institute for Economic and Social Research, Faculty of Economics and Business, Universitas Indonesia (LPEM FEB UI)) |
| Abstract: | Government policies demand an integrated approach that incorporates policy modeling, especially given the uncertainties in real-world conditions. The lack of a comprehensive approach may result in government failures or imbalances in economic sectors. In Indonesia, the state of policy is structured into government planning documents. The government also aspires to achieve a higher income country status and, at the same time, smooth energy transition with Indonesia’s climate targets being comparable with other G20 countries. However, the methods to reach these goals often follow a top-down approach and have limited interlinks across different sectors or ministries. Nonetheless, several studies indicate discrepancies between feasible actions and current targets, highlighting the need for clarity in modeling and communication. Policy modeling in Indonesia is both clustered and scattered. While there’s consistency within the "families" of models, there's a gap between different "families", creating challenges in drawing comparative insights. Therefore, there is an increased need for transparency and communication. Policy models need to be more transparent about their underlying assumptions and methodologies. This clarity would enable third-party replication and scrutiny, enhancing credibility and fostering accountability. Many alternatives of policy modeling can be used, for instance, the platform developed by Sentient Hubs (Sentient Hubs can be accessed through its website on https://www.sentient-hubs.com). Serving as an integrated policy and impact modeling platform, Sentient Hubs could bridge the current modeling gaps. Its capability to integrate various models covering economic, social and environmental aspects, and providing customizable dashboards presenting a wide range of ‘what if’ scenarios, could enable stakeholders to gain deeper insights and holistic perspectives. Achieving a comprehensive policy modeling framework in Indonesia requires collaborative efforts from various stakeholders. The use of unique new alternative platforms could play a pivotal role in bridging existing gaps, ensuring that policies are both transparent and actionable. |
| Keywords: | policy modelling — energy transition — Indonesia |
| JEL: | C69 O21 Q56 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:lpe:wpaper:202376&r=ene |
| By: | ruggeri, giuseppe |
| Abstract: | This paper reviews energy development over the last few centuries and analyzes potential future trends. It argues that the supply-based policies of the past and present are not sustainable and suggests greater emphasis on demand-based policies. It also stresses that the shift from supply-based to demand-based policies involves a change in the value system that guides human behaviour. |
| Date: | 2023–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:sbh3k&r=ene |
| By: | Shapiro, Joseph S |
| Abstract: | This paper proposes that strong financial, judicial, and labor market institutions provide comparative advantage in clean industries, and thereby improve a country’s environmental quality. Five complementary tests support this hypothesis. First, industries that depend on institutions are disproportionately clean. Second, strong institutions increase relative exports in clean industries, even conditional on environmental regulation and factor endowments. Third, an industry’s complexity helps explain the link between institutions and clean goods. Fourth, a quantitative general equilibrium model indicates that strengthening a country’s institutions decreases its pollution through relocating dirty industries abroad, though increases pollution in other countries. Fifth, cross-country differences in the composition of output between clean and dirty industries explain more of the global distribution of emissions than differences in the techniques used for production do. The comparative advantage that strong institutions provide in clean industries gives one under-explored reason why developing countries have relatively high pollution levels. |
| Keywords: | Social and Behavioral Sciences, institutions, comparative advantage, pollution |
| Date: | 2024–01–11 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:agrebk:qt17g3r8m5&r=ene |
| By: | Fix, Blair |
| Abstract: | FROM THE ARTICLE. *** In their book Manufacturing Consent, Edward Herman and Noam Chomsky argue that the mainstream media functions largely as a propaganda arm for the state. When the war drum beats, the corporate media tows the government’s line, censoring facts that don’t fit the official narrative. *** Outside of war, media bias is typically less overt. But to the careful observer, it can still be discerned. In this case, our careful observer is Canadian oil critic Regan Boychuk. *** Boychuk lives in Calgary — a prairie city that is famous for two things. Calgary hosts the world’s largest rodeo. And it is the corporate heart of the Canadian oil business. Calgary … home to cowboys and crude-oil CEOs. *** As you might guess, our story of media censorship is not about cowboys. Calgary’s main newspaper, the Herald, is staunchly pro-oil. And that means its editorial pages are filled with oilpatch jingoism. However, the rest of the paper is an archetype of neutral reporting. Just kidding. *** Unsurprisingly, the Herald’s pro-oil stance shapes the content that appears in the paper. This post takes a quantitative look at the editorial ‘curation’. *** Most of the heavy lifting has been done by Boychuk, who had the brilliant idea to track the reporting of environmental journalist Mike De Souza. Between November 2010 and July 2013, De Souza wrote a series of articles documenting scandals related to the Canadian oilpatch, and its staunch defender, the Harper government. *** At the time, De Souza was working for Postmedia, a news conglomerate that operated a wire service for its many subsidiaries. So when De Souza’s pieces were published, they were delivered to local papers like the Ottawa Citizen, the Edmonton Journal, and the Calgary Herald. *** Here’s the catch. Although owned by the same conglomerate, these local papers had leeway to edit (or shelve) their wire-service articles. The result, Boychuk realized, was a controlled setting to analyze media censorship. Earlier this year, Boychuk published his findings in a piece called ‘Proximity to Power: The oilpatch & Alberta’s major dailies’. *** My contribution here is mostly visual. I’ve taken Boychuk’s investigation and translated it into charts. The results largely speak for themselves. As De Souza’s articles approached the center of Canadian oil-and-gas power in Calgary, they were increasingly gutted, and their message changed. It’s a fascinating case study of how business interests shape the news. |
| Keywords: | Alberta, Canada, censorship, energy, environment, journalism, newspapers, oil |
| JEL: | P P1 P14 P18 L82 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:280858&r=ene |
| By: | Boeing, Geoff (Northeastern University); Pilgram, Clemens; Lu, Yougeng |
| Abstract: | This study estimates the relationships between street network characteristics and transport-sector CO2 emissions across every urban area in the world and investigates whether they are the same across development levels and urban design paradigms. The prior literature has estimated relationships between street network design and transport emissions---including greenhouse gases implicated in climate change---primarily through case studies focusing on certain world regions or relatively small samples of cities, complicating generalizability and applicability for evidence-informed practice. Our worldwide study finds that straighter, more-connected, and less-overbuilt street networks are associated with lower transport emissions, all else equal. Importantly, these relationships vary across development levels and design paradigms---yet most prior literature reports findings from urban areas that are outliers by global standards. Planners need a better empirical base for evidence-informed practice in under-studied regions, particularly the rapidly urbanizing Global South. |
| Date: | 2024–01–02 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:r32vj&r=ene |
| By: | Darlington Agbonifi (Department of Economics (University of Verona)) |
| Abstract: | This paper presents an integrated methodology to simultaneously estimate the socioeconomic and environmental impacts of public-financed investments in green projects on the labor markets, value-added, and households induced consumption expenditures in a multiregional economy in equilibrium. I construct a novel dataset and implement an environmentally integrated multiregional social accounting matrix (EI-MRSAM) modelling technique on the regional macroeconomic investment analyses for Italy. Results show that Lombardy’s intra-regional investment impact on value-added (GDP) share accounts for almost 78%, while 22% accrues to the rest of Italy in terms of interregional value-added spillover effects through trade channels. The public investments impact on the regional and national economy decreases by around 10% of value-added after internalizing the environmental costs of climate change damages induced by industrial greenhouse gas (GHG) emissions. I then conduct a counterfactual ex-ante macro-policy evaluation of an endogenous increase by 25% of the baseline investments to each of thematic missions which represents the key areas of the public policy interventions. I find that the return-on-investment in digital and innovative public-administration as most efficient in terms of potential regional value-added growth compared to other counterfactual outcomes. The impact on consumption expenditures and induced GHG emissions are also consistent with those of value-added. |
| Keywords: | EI-MRSAM model, investments in green projects, value-added GDP, climate change, GHG emissions, environmental valuation, digital transformation |
| JEL: | C67 D57 F18 H54 Q56 R12 |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:ver:wpaper:02/2024&r=ene |
| By: | Hinterlang, Natascha; Martin, Anika; Röhe, Oke; Stähler, Nikolai; Strobel, Johannes |
| Abstract: | Climate change and climate policy will have far-reaching economic implications, thereby also posing new challenges for macroeconomic analysis. This is partly because climate risks have an important global dimension. Moreover, climate change and climate polices are likely to affect different economic sectors to varying degrees. Hence, in order to adequately gauge the macroeconomic implications of climate risks, models with sufficient regional and sectoral differentiation are needed. Against this background, we developed the environmental multi-sector dynamic stochastic general equilibrium model EMuSe. This paper presents the main features of the benchmark closed-economy flexible-price model, an open-economy extension of the model, a variant of the model with price-setting frictions and selected applications to illustrate key transmission channels. In order to give those who are interested the opportunity to gain more experience with EMuSe, the model codes are published together with this documentation. |
| Keywords: | climate risks, DSGE, production linkages, sectoral heterogeneity |
| JEL: | E3 E6 F4 H3 Q5 |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:esprep:280900&r=ene |
| By: | Guter-Sandu, Andrei; Haas, Armin; Murau, Steffen |
| Abstract: | The Green Transition to net-zero carbon emissions in Europe requires massive financing efforts, with estimates of 620 billion EUR annually, but the headwinds are substantive. Central banks seem overstretched and busy tightening to combat inflation; treasuries are subject to austerity-inducing fiscal rules; and banking systems are afflicted by non-performing loans, fragmentation, and risk aversion. We employ the framework of ‘monetary architecture’ to analyse the EU’s monetary and financial system as a constantly evolving hierarchical web of interlocking balance sheets and study its capacity to find ‘elasticity space’ to meet the financing challenge. To this end, we draw on a four-step scheme for green macro-financial governance along the financial cycle of balance sheet expansion, funding, and final contraction. We find that, first, Europe’s monetary architecture still has ample elasticity space to provide a green initial expansion due to its developed ecosystem of national, subnational, and supranational off-balance-sheet fiscal agencies. Second, as mechanisms lack to consciously organise the distribution of long-term debt instruments across different segments, its capacity to provide long-term funding is limited. Third, institutional transformation in the last two decades have greatly improved the capacity of the European monetary architecture to counteract financial instability by providing emergency elasticity. Fourth, the capacity of the European monetary architecture to manage a final contraction of balance sheets is limited, which is a general quandary in modern credit money systems. Our analysis points to the need for further investigations into techniques for monetary architectures to manage long-term funding and balance sheet contractions. |
| Date: | 2023–12–23 |
| URL: | http://d.repec.org/n?u=RePEc:osf:socarx:4mb2q&r=ene |
| By: | Yoosoon Chang (Indiana University); Yongok Choi (Chung-Ang University); Chang Sik Kim (Sungkyunkwan University); J. Isaac Miller (University of Missouri); Joon Y. Park (Indiana University) |
| Abstract: | We employ a semiparametric functional coefficient panel approach to allow an economic relationship of interest to have both country-specific heterogeneity and a common component that may be nonlinear in the covariate and may vary over time. Surfaces of the common component of coefficients and partial derivatives (elasticities) are estimated and then decomposed by functional principal components, and we introduce a bootstrap-based procedure for inference on the loadings of the functional principal components. Applying this approach to national energy-GDP elasticities, we find that elasticities are driven by common components that are distinct across two groups of countries yet have leading functional principal components that share similarities. The groups roughly correspond to OECD and non-OECD countries, but we utilize a novel methodology to regroup countries based on common energy consumption patterns to minimize root mean squared error within groups. The common component of the group containing more developed countries has an additional functional principal component that decreases the elasticity of the wealthiest countries in recent decades. |
| Keywords: | energy consumption, energy-GDP elasticity, partially linear semiparametric panel model, functional coefficient panel model |
| Date: | 2024–01 |
| URL: | http://d.repec.org/n?u=RePEc:inu:caeprp:2024001&r=ene |
| By: | Galindo, Luis Miguel; Alatorre, José Eduardo; Ferrer, Jimy |
| Abstract: | El objetivo de este estudio es construir un modelo econométrico estructural de pequeña escala, para analizar los potenciales efectos negativos del cambio climático en las actividades económicas y estimar el impacto potencial que tienen los procesos de mitigación de gases de efecto invernadero en América Latina y el Caribe. El modelo cuenta con diversos bloques con los que se busca incorporar el conjunto de las interacciones entre los impactos del cambio climático y los procesos de mitigación de las emisiones de gases de efecto invernadero y la dinámica económica y social que prevalece en los países de la región, a fin de contribuir a la formulación de una estrategia de transición climática justa, teniendo en consideración que la nueva estrategia de desarrollo de largo plazo debería incorporar de forma explícita los vínculos entre la macroeconomía y la sostenibilidad ambiental. El modelo está especificado de forma simple, lo que permite seguir la lógica subyacente de los impactos y sus canales de transmisión. |
| Date: | 2023–12–21 |
| URL: | http://d.repec.org/n?u=RePEc:ecr:col022:68770&r=ene |