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on Energy Economics |
| By: | Philippe Aghion; Lint Barrage; David Hemous; Ernest Liu |
| Abstract: | We analyze a model of green technological transition along a supply chain. In each layer, a good is produced with a dirty technology, or, if the required "electrification" innovation has occurred, with a clean technology which uses the immediate upstream good. We show that the economy is characterized by a single equilibrium but multiple steady-states, and that even in the presence of Pigouvian environmental taxation, a targeted industrial policy is generally necessary to implement the social optimum. We also show that: (i) small, targeted, industrial policy may bring large welfare gains; (ii) a government which is constrained to focus its subsidies to electrification on one particular sector, should primarily target downstream sectors; (iii) when extending the model so as to allow for supply chains also for the dirty technology, overinvesting in electrification in the wrong upstream branch may derail the overall transition towards electrification downstream. Finally, we illustrate our model with a calibration to decarbonization of global iron and steel production via hydrogen direct reduction, and show that, absent industrial policy, the economy can get stuck in a "wrong" steady-state with CO2 emissions vastly above the social optimum even with a carbon price in place. |
| Keywords: | Technological change, Green Growth, supply chain |
| Date: | 2024–07–10 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepdps:dp2017 |
| By: | Michael G Pollitt; Daniel Duma; Andrei Covatariu |
| Keywords: | Uncertainty, energy regulation, net zero |
| JEL: | L51 L94 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2411 |
| By: | Caterina Seghini; Stéphane Dees |
| Abstract: | As the world faces rising temperatures, extreme weather events and environmental disruption, the imperative to mitigate climate change has never been more pressing. Yet the pursuit of effective mitigation could threaten the sustainability of public debt due to the potentially huge fiscal costs of the associated policies. This paper uses a dynamic general equilibrium approach that takes into account the macroeconomic implications of the green transition and its consequences for public finances. It shows that when the government relies too heavily on expenditure-based measures, it threatens the sustainability of public debt, by increasing the probability of sovereign default, leading to higher interest rates on government bonds. This higher public default risk has potentially significant repercussions on investment financing conditions for the private sector, and increases the cost of the transition to a net-zero economy. On the other hand, carbon pricing policies make the transition more viable for public finances, at the expenses of similarly high economic costs, while remaining effective in reducing greenhouse gas emissions. The welfare-maximizing optimal policy mix yields a balanced approach, where the share of the mitigation effort undertaken by the public sector ranges from 25% to 40% between 2030 and 2050. |
| Keywords: | Climate Change, Mitigation Policies, Environmental Taxes and Subsidies, Public Finances |
| JEL: | D58 E63 H23 H63 Q54 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:bfr:banfra:949 |
| By: | Jens Horbach (Technical University of Applied Sciences Augsburg, School of Business, Friedberger Straße 4, D-86161 Augsburg) |
| Abstract: | The success of a green energy transition is highly dependent on the household sector as one of the most important energy users. Private heating, electricity consumption or private transport are important key levers to reduce households´ energy use and its impacts on cli-mate change. The paper analyses the determinants of energy related attitudes and activities of households based on econometric estimations of European and German survey data. The results show that personal factors such as female gender and a high income are positively correlated to green energy behaviour. Highly qualified persons are more likely to realize green energy related measures. People having difficulties to pay their bills are significantly more likely to use energy friendly public transport, but they have a lower willingness to pay for energy saving measures compared to richer groups. |
| Keywords: | Green energy behaviour, climate change, European data, multivariate probit model |
| JEL: | C25 D12 D91 Q41 Q54 |
| Date: | 2024–02 |
| URL: | https://d.repec.org/n?u=RePEc:srt:wpaper:0224 |
| By: | Shakya, Lumana |
| Keywords: | International Development, Environmental Economics And Policy, Consumer/ Household Economics |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:343824 |
| By: | DREONI Ilda (European Commission - JRC); MAIER Sofia (European Commission - JRC) |
| Abstract: | With the hike of global energy prices of 2022-2023 and the fairness challenges of the green transition, energy poverty is again back to the forefront of economic policy debates in Europe. However, the absence of consensus on energy poverty measurement complicates policy formulation and evaluation in this domain. This paper conducts a comprehensive analysis of the EU-wide distribution and profiles of the ‘energy poor’. We use four well-known measures of energy poverty, two subjective and two based on expenditures, coming from two different household surveys, i.e., HBS and SILC, which we statistically match. With this, we fill an important gap in the literature by measuring the extent of overlap between these indicators. Our results reveal that expenditure-based indicators cover larger shares of the population, especially in middle and high-income EU countries, with very small overlap between energy poverty measures. In the EU, only 0.3% of the population qualifies as ‘energy poor’ when considering all four indicators, while four out of ten (40%) would enter this club by at least one of these indicators. Overall, by providing a characterization of the profiles of those who would be covered or ‘left behind’ by each of these indicators, as well as their relationship with incomes and expenditures, we shed new light on the heterogeneous distributional effects from policy-targeting based on these indicators. |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:taxref:202405 |
| By: | Michael G Pollitt |
| Keywords: | Optimal tax theory, road user charges, energy taxation, electricity reform |
| JEL: | H21 R48 Q48 L94 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2409 |
| By: | Michael G Pollitt |
| Keywords: | Incentive regulation, vertical integration, emissions markets, electricity liberalisation |
| JEL: | L43 L51 Q53 Q54 L94 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2410 |
| By: | Frederick van der Ploeg; Armon Rezai; Miguel Tovar |
| Abstract: | We analyse carbon taxes, lump-sum climate dividends, and changes to the level and progressivity of the income tax system that optimally trade off carbon emissions, equity, and efficient raising of public revenue while preserving budgetary neutrality and not using individualized lump-sum transfers. Such “third-best” policies include a carbon tax that exceeds the Pigouvian level and recycling of all carbon tax revenue via climate dividends for high (and our preferred) degrees of inequality aversion, even if this implies higher income taxes to meet existing revenue requirements. The carbon tax, climate dividends, and the progressivity of the income tax rise with the degree of inequality aversion. Our results are derived from a micro simulation model estimated from German data, which includes heterogenous households, an Exact Affine Stone Index demand system, and endogenous labour supply. We decompose the welfare effects of policy into emissions, equity, and efficiency components for different degrees of inequality aversion and climate damages. |
| Date: | 2024–07–25 |
| URL: | https://d.repec.org/n?u=RePEc:oxf:wpaper:1050 |
| By: | Teresa Lackner (University of Graz); Luca E. Fierro (International Institute for Applied Systems Analysis (IIASA)); Patrick Mellacher (University of Graz) |
| Abstract: | The paper introduces an integrated approach, blending Opinion Dynamics with a Macroeconomic Agent-Based Model (OD-MABM). It aims to explore the co-evolution of climate change mitigation policy and public support. The OD-MABM links a novel opinion dynamics model that is calibrated for European countries using panel survey data to the Dystopian Schumpeter meeting Keynes model (DSK). Opinion dynamics regarding stringent climate policy arise from complex interactions among social, political, economic and climate systems where a household’s opinion is affected by individual economic conditions, perception of climate change, industry-led (mis-)information and social influence. We examine 133 pathways for climate change mitigation policies in the EU, integrating various carbon tax schemes and revenue recycling mechanisms. Our findings reveal that while effective carbon tax policies initially lead to a decline in public support due to substantial macroeconomic transition costs, they concurrently drive a positive social tipping point in the future. This shift stems from the evolving economic and political influence associated with the fossil fuel-based industry, gradually diminishing as the transition unfolds. Second, hybrid revenue recycling strategies that combine green subsidies with climate dividends successfully address this intertemporal tradeoff, broadening public support right from the introduction of the carbon tax. A decomposition of opinion dynamics into the different channels reveals the important role of social influence through which individual experience can propagate within social networks giving rise to rapid and non-linear opinion swings. |
| Keywords: | Climate change, mitigation policy, opinion dynamics, agent-based models, transition risks. |
| JEL: | C63 H31 Q43 Q50 |
| Date: | 2024–02 |
| URL: | https://d.repec.org/n?u=RePEc:grz:wpaper:2024-07 |
| By: | Aleksandar Andonov; Joshua Rauh |
| Abstract: | Despite the incentives of incumbent domestic listed corporations (DLCs) in the electricity generation industry, private equity, institutional investors, and foreign corporations have played an outsized role in financing the energy transition. These new entrants are twice as likely to create power plants as incumbents. They owned 58% of wind, 47% of solar, and 34% of natural gas electricity production as of 2020. The ownership changes are concentrated in deregulated wholesale markets which attract more capital from new entrants to create renewable and natural gas plants, acquire existing plants, and accelerate the decommissioning of coal plants. Sales of fossil fuel plants from DLCs to foreign corporations result in some leakage, but private equity has similar decommissioning rates to incumbents. The new ownership types create more efficient power plants with a lower heat rate and improve the efficiency of acquired plants. Our results also highlight an important tradeoff in bringing new financing sources to the electricity sector. When selling electricity, private equity and foreign corporations use contracts with shorter duration, shorter increment pricing, and more peak-period sales, and obtain a $2.59 higher average price per MWh. |
| JEL: | G23 G24 G32 H54 L51 L71 L94 O13 Q41 Q48 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:32733 |
| By: | Edoardo Campanella (Harvard Kennedy School); Robert Z. Lawrence (Peterson Institute for International Economics) |
| Abstract: | Driven by the push to decarbonize the world and achieve net zero emissions by 2050, a new anti-elite revolt is in the making in developed economies: If mainstream parties ignore the losers of the green transition as they did with globalization, climate populism not only will slow the adoption of climate policies but could also shake Western democracies. Climate policies are a perfect target for populist rhetoric: They rely on expert knowledge, entail globalist thinking and action, and the counterfactual nature of their benefits--avoiding disasters that would otherwise happen--gives ample fodder for conspiracy theories. And their costs are unevenly shared, hitting those at the bottom of the income distribution significantly harder than those at the top. Climate populism is particularly a problem on the far right, where doubts about science and opposition to international cooperation are strongest. Policies need to deal with this rising political opposition. Given the depth of their grievances, and as is often the case with populism, it is unlikely that voters antagonistic to climate policies will be persuaded by rational arguments. What will change their behavior are economic incentives. If green technologies are cheaper than fossil fuel ones, they will be adopted to save money rather than the planet. Thus the costs of the green transition need to be reduced through more open trade in the short run and more innovation in the long run. In addition, those who support climate policies need to be mobilized through more engaging political strategies, more emotional narratives, and more bottom-up policy approaches. |
| Keywords: | Climate change, populism, green transition |
| JEL: | F6 P5 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iie:wpaper:wp24-16 |
| By: | Tørstad, Vegard; Wiborg, Vegard |
| Abstract: | International review mechanisms can help states overcome collective action problems by revealing accurate information about their cooperative intent and performance. However, many existing review mechanisms have lenient informational requirements, leading to ambiguous reporting that impedes mutual verification of efforts and potentially undermines cooperation. This article evaluates how commitment ambiguity affects cooperation under the Paris Agreement on climate change, which features a pledge-and-review system where governments decide unilaterally on the depth of their commitments. We develop a decision-theoretic model of ambiguity and risk behavior in climate pledges that delineates the relationship between commitment ambiguity and ambition. In our model, commitment ambiguity is a sum of structural uncertainty and strategic ambiguity. We argue that structural uncertainty—information constraints that prevent governments from perfectly gauging their commitment potential—reduces ambition in climate pledges. This prudence effect is driven by compliance concern: The anticipated international and domestic audience costs arising from noncompliance induce policymakers to adjust ambition downward. Our empirical analysis of all climate pledges under the Paris Agreement demonstrates that ambiguous pledges are less ambitious than precise pledges, in line with our prudence conjecture. We also show that democracies are more prudent than autocracies, reflecting systemic variations in domestic audience costs. Overall, this article contributes an original theory of how ambiguity affects cooperation in international institutions and produces empirical findings that shed light on the effectiveness of international climate cooperation. |
| Keywords: | Social and Behavioral Sciences, Ambiguity, compliance, intergovernmental organizations, international environmental agreements, Paris Agreement, transparency |
| Date: | 2023–11–13 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:globco:qt7gd693zp |
| By: | Volker Ziemann |
| Abstract: | Slovenia's current housing challenges are characterised by strong demand and inadequate supply, exacerbated by rising construction and financing costs. High ownership rates mask the affordability challenge for younger cohorts or those who want to move amid limited rental markets and insufficient residential construction activity. This paper proposes a range of policy options to make housing more efficient, inclusive and sustainable. Streamlining spatial planning and permitting systems would foster housing supply responsiveness. Levelling the playing field in rental markets and overhauling real estate taxation can boost market efficiency. Enhancing access to mortgage financing and improving framework conditions for the provision of social housing would expand housing options for households. Finally, housing policies should aim at accelerating the transition to a net-zero economy by aligning energy taxation more closely with the carbon content of the source, strengthening the support programmes for renovation works and improving framework conditions for the deployment of district heating and electrification. |
| Keywords: | Housing affordability, Housing decarbonisation, Housing policy, Housing supply, Property taxation, Rental markets, Residential construction, Social housing, Spatial planning |
| JEL: | H23 H77 R31 R38 G21 |
| Date: | 2024–07–25 |
| URL: | https://d.repec.org/n?u=RePEc:oec:ecoaaa:1810-en |
| By: | Breitschopf, Barbara; Lotz, Meta Thurid; Marscheider-Weidemann, Frank |
| Abstract: | The price pass-through of CO2 costs was analysed for HRC and PE/PP products as parts of a BEV. It was revealed that the feasibility of transferring these costs hinges on a company's ability to dictate prices, either as a significant player in international markets or through bilateral agreements. While the data and information gathered shed light on the complexity of business relationships and markets, it unequivocally demonstrates that the question of price pass-through is far from being answered straightforward. Low transparency about various business relations and markets, lack of information on specific production volumes, inputs, and current cost and pricing data were identified as critical hindrances to assessing the pass-through of prices, despite the existence of scientific concepts. Within the industry, a few companies may possess a strong foothold in the global market and be equipped to navigate elevated costs without external intervention, whereas others may lack the means to offset cost increases due to CO2 prices. Policymakers are thus faced with the challenge of formulating targeted policies for less competitive companies and industries expected to lose market shares due to CO2 pricing, while refraining from interfering with those capable of robust market competition. In essence, the domestic imposition of CO2 pricing poses a significant threat to the price competitiveness of the domestic carbon-intensive industry. A welldesigned CBAM is imperative, yet its effectiveness on global prices also hinges on whether global producers are subject to CO2 emission costs. Should global producers remain unaffected by such expenses, many European producers are likely to encounter a general cost disadvantage when exporting to the international market. |
| Keywords: | competitiveness, CO2 prices, chemical and steal industry |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:fisisi:300575 |
| By: | Grigolon, Laura; Park, Eunseong; Remmy, Kevin |
| Abstract: | We use micro-level data on fuel consumption, mileage, and travel mode to study plug-in hybrid drivers' response to fuel prices. When fuel prices rise, plug-in hybrids reduce fuel consumption more than gasoline and diesel cars. They do not reduce their mileage but increase electric recharging, without evidence of habit formation. As the share of kilometers driven in electric mode by plug-in hybrids is only half the official test cycle value, fuel prices are effective in improving the environmental performance of these vehicles. We estimate drivers' value of charging time at €15 to €41/hour. |
| Keywords: | fuel price elasticity, automobiles, carbon emissions |
| JEL: | D12 L91 Q31 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:zewdip:300273 |
| By: | Michael Finus (University of Graz, Austria); Francesco Furini (University of Hamburg, Germany); Anna Viktoria Rohrer (University of Graz, Austria) |
| Abstract: | A commonly reported result in the literature on international environmental agreements (IEAs) is that if coalition members act as Stackelberg leaders (Stackelberg scenario) this leads to larger stable coalitions than if signatories act simultaneously with non-signatories. (Nash-Cournot scenario). This result has been taken for granted, a kind of Folk-theorem, even though it has been proven at best for specific payoff functions, and very often the conclusion is only based on simulations. We prove the Stackelberg vs. Nash-Cournot Folk-theorem based on a generic payoff function for a public good provision game. |
| Keywords: | International environmental agreements, Stability, Stackelberg vs. Nash-Cournot Folk-theorem. |
| JEL: | C72 D62 H41 |
| Date: | 2024–01 |
| URL: | https://d.repec.org/n?u=RePEc:grz:wpaper:2024-02 |
| By: | Cheikh, Nidhaleddine Ben (ESSCA School of Management); Rault, Christophe (University of Orléans) |
| Abstract: | While the financial inclusion would induce greater pollutant emissions through its impact of economic activity, the increased access to financial services may unleash investments in green technologies. This papier investigates whether the financial inclusion influences the dynamic of carbon dioxide (CO2) emissions in a sample of 70 countries during the last decade. We implement panel threshold techniques to explore the possible regime shifts in the environmental quality. Our results reveal that an increased financial access impacts air pollution depending on the level of economic development. While financial inclusion would increase CO2 emissions under lower-income regimes, the environment quality seems to be enhanced with more inclusiveness at later stages of development. Sounder environmental policies are needed for less developed countries to align financial inclusion initiatives with sustainable economic development. |
| Keywords: | financial inclusion, carbon emissions, panel threshold modelling |
| JEL: | C23 O16 O44 Q53 Q56 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17150 |
| By: | DONATELLO Shane; PEREZ CAMACHO M Nati (European Commission - JRC); WOLF Oliver (European Commission - JRC) |
| Abstract: | Green public procurement (GPP) is a powerful tool to achieve environmental objectives by means of the incorporation of green requirements into public sector purchasing contracts. Public authorities, by promoting “green” purchases, incentivise environmentally beneficial outcomes and foster market innovation as well as the transformation towards a sustainable economy model. In order to “green” the market, it is essential for producers to be able to make certifiable and credible green claims about their products and for customers to know what to ask for. While the EU Ecolabel policy can provide environmental references or standards in relation to green claims on products, the EU GPP policy can help customers to know what to ask for. The EU GPP recommendations placed in this document are based on the EU Ecolabel criteria and intend to provide authorities with guidance on how to use ecolabels, and in particular the EU Ecolabel, in the procurement process. This report aims to bring these two policies together in order to find synergies between the supply-side EU Ecolabel policy and the demand-side EU GPP policy – specifically for the procurement of hard covering products made of natural stone, agglomerated stone, ceramics/fired clay or precast concrete. In addition to a brief introduction to the EU Ecolabel policy, to the EU GPP policy and to procurement procedures as a whole, research is presented to support JRC recommendations to public procurers about exactly what green criteria to set when trying to procure environmentally friendly hard covering products. The recommended environmental criteria are split into three themes that focus on: (i) energy consumption and CO2 emissions (different approaches for sub-products made with and without combustion processes); (ii) emissions to air (dust and, where relevant, SOx, NOx and HF), and (iii) process waste reuse at the production site (different benchmarks for different sub-products). Where relevant, further information about the why the EU Ecolabel criteria are relevant and what other ISO 14024 type I ecolabels may be considered as equivalent is provided. This builds up upon the work that concluded with the adoption of the EU Ecolabel criteria, project that was also led by the JRC and finalised in 2021. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc131863 |
| By: | Fleiter, Tobias; Rehfeldt, Matthias; Neusel, Lisa; Hirzel, Simon; Neuwirth, Marius; Schwotzer, Christian; Kaiser, Felix; Gondorf, Carsten |
| Abstract: | In 2022, process heat was responsible for about two-thirds of industrial greenhouse gas emissions. Any transformation toward a climate-friendly industry also requires a successful heat transition by converting process heat to CO2-neutral energy sources. At present, this is only taking place in isolated cases and is being slowed down or prevented by a range of economic, regulatory and technical obstacles. This policy brief provides a comprehensive overview of the technology potential of hydrogen and electricity for supplying process heat and indicates the main obstacles involved as well as the action required to design suitable policies. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:fisipp:300578 |
| By: | Leo Mercer; Esin Serin; Anna Valero |
| Abstract: | The scale of change and investment required for net zero is challenging, but early action is the most cost-effective way to achieve the 2050 target and could bring opportunities. |
| Keywords: | Election 2024, Election2024, Green Growth, UK Economy, climate |
| Date: | 2024–07–03 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepeap:067 |
| By: | Bontems, Philippe; Cheikbossian, Guillaume; Hafidi, Houda |
| Abstract: | This paper focuses on the welfare effects of domestic and international lobbying in the context of two countries linked by both trade and pollution. We consider a reciprocal-markets model where, in each country, a domestic firm produces a polluting good, that can result in a cross-national environmental externality, and competes in quantities in each market with a foreign firm. Each government independently sets a pollution tax under political pressure from green and industrial lobbies `a la Grossman and Helpman (1994). Our results mainly show that political pressure from domestic and/or international lobbies can help mitigate tax competition between the two countries, resulting in an improvement in social welfare. In fact, lobbying acts much like a strategic delegation device by changing the social welfare weights in the objective function of each government. The (potential) welfare-improving effect of political pressure depends on the relative strengths of the lobbies and on the nature of the strategic interactions in taxes. |
| Keywords: | Lobbying; transboundary pollution; international trade; international politics; environmental tax |
| JEL: | D72 F12 F18 Q58 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:129516 |
| By: | Ran Yan; Minda Ma |
| Abstract: | This study explores the historical emission patterns and decarbonization efforts of China and India, the largest emerging emitters in residential building operations. Using a novel carbon intensity model and structural decomposition approach, it assesses the operational decarbonization progress over the past two decades. Results show significant decarbonization, with China and India collectively reducing 1498.3 and 399.7 MtCO2, respectively. Electrification notably contributed to decarbonizing space cooling and appliances in both countries. |
| Date: | 2024–05 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2407.01564 |
| By: | Castelli, Chiara; Castellini, Marta; Gusperti, Camilla; Lupi, Veronica; Vergalli, Sergio |
| Abstract: | The goal of this work is to improve the spatial representation of the Regional Dynamic Integrated model of Climate and the Economy (RICE), in its ’99 version, focusing on the Mediterranean countries, while also updating the calibration to the base year 2015. We evaluate the impact of climate damages and temperature changes in several scenarios, drawing comparisons across regions. Thanks to the theoretical structure of the model, which considers energy as an explicit input factor, we examine macroeconomic and energy indicators across regions. We find that a general slow down in economic growth is needed to decrease emissions and keep temperature change within 2°C by the end of this century. Our results are embedded in a framework showing the costs of delaying the energy transition. Our figures relies on fossil-fuel inputs and exogenous energy saving improvements. |
| Keywords: | Climate Change, Resource /Energy Economics and Policy |
| Date: | 2024–07–17 |
| URL: | https://d.repec.org/n?u=RePEc:ags:feemwp:344175 |
| By: | Magnus Merkle; Geoffroy Dolphin |
| Abstract: | We analyse the consequences of carbon price heterogeneity on households in The EU from 2010 to 2020. Accounting for both heterogeneity in carbon pricing across emission sources and the indirect effects from inter-industry linkages, we obtain two key findings. First, due to widespread carbon pricing exemptions, household burdens are lower than previously estimated. Second, lower-income groups are affected disproportionately, because they spend a smaller share of their expenditure on products that benefit from exemptions than their higher-income counterparts. Therefore, imposing uniform carbon prices both within and across countries would reduce carbon pricing regressivity on household expenditure in the EU. A global price would be most effective in this regard, as it would raise carbon prices embodied in EU imports. Further, because EU economies are open and apply higher average carbon prices than their trade partners, the domestic revenues exceed the costs embodied in EU household consumptions bundles. This increases the scope for reducing the burden of carbon pricing on lower-income households through revenue redistribution. Our results imply that the ongoing extension of carbon pricing to more sectors through the EU ETS II and the introduction of the EU’s CBAM should make carbon pricing less regressive, all else equal. |
| Keywords: | Carbon pricing; tax incidence; climate policy |
| Date: | 2024–07–12 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2024/149 |
| By: | Monica Bonacina (Fondazione Eni Enrico Mattei and Department of Environmental Science and Policy, University of Milan); Mert Demir (Fondazione Eni Enrico Mattei); Antonio Sileo (Fondazione Eni Enrico Mattei and Green – Università Bocconi); Angela Zanoni (Fondazione Eni Enrico Mattei and Università di Roma La Sapienza) |
| Abstract: | The transition to a zero-emission car fleet is a pivotal element of Europe’s decarbonisation strategy. Italy’s participation in this trajectory is significant, given the size of its car fleet. Currently, only battery electric (BEVs) and hydrogen-powered are considered zero-emission vehicles. The final update of the National Energy and Climate Plan (NECP) includes an ambitious target for the diffusion of electric cars in the Italian fleet. The aim is to have a total of 4.3 million electric cars on the roads by 2030. However, by the end of 2023, the Italian e-fleet totalled 220, 000 cars, which equals a mere 0.5% of the overall car population and 5% of the target. The objective of this study is threefold: firstly, to estimate the likely diffusion of electric cars in the Italian market; secondly, to assess the prospects for their penetration in the fleet in the coming years; and thirdly, to evaluate the consistency of the current diffusion path with the NECP target. Diffusion paths are derived using Bass and logistic diffusion models. We consider a business-as-usual scenario based solely on historical trends, and an accelerated diffusion alternative scenario, in which we assume that by 2023 new BEV models will enter the Italian car market, raising the market potential for this powertrain to the same level as the most successful non-plug-in hybrid models. Both scenarios show that, in the absence of further significant shifts, the deployment paths will be totally insufficient to meet NECP 2030 target. Fewer than half a million consumers appear to be interested in buying one of the battery electric models currently on sale in the business-as-usual scenario. The low share of enthusiastic potential adopters of BEVs, the increasing useful life of passenger cars, the lack of highly successful BEV models, the limited impact of the incentive schemes until 2023 and the strong competition from other alternative technologies (besides non-plug-in hybrids and LPG) continue to impede the penetration of electric powertrains in the Italian fleet. Incentive schemes and decarbonisation strategies must undergo major revision to achieve a path consistent with net-zero emission goals. |
| Keywords: | sustainable mobility, road transport decarbonization, electric vehicle adoption, automotive market, Italian National Energy and Climate Plan (NECP) |
| JEL: | N74 Q55 Q58 R40 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2024.19 |
| By: | Robinson, Anya R.; Hardman, Scott PhD |
| Abstract: | Under the Advanced Clean Cars II (ACC II) rule, California must move to 100% zero emission vehicle (ZEV) sales by 2035. Tomake this transition equitable, it is important to understand how we can support ZEV adoption in all communities–including rural communities. The aim of this study is to explore the experiences and perceptions of current rural plug-in electric vehicle (PEV) owners, identify barriers to charging and ownership, and suggest factors to guide the development of infrastructure in rural areas. (PEVs include battery-electric vehicles [BEVs] and plug-in hybrid vehicles.) Semi-structured interviews were conducted with rural PEV owners and included questions related to travel behavior, at-home and public charging experiences, and motivation for household vehicle purchase. Major themes were extracted from the interviews including that PHEV owners tend to have minimal at-home and public charging requirements, while BEV owners require access to Level 2 charging at home and reliable fast charging in public spaces. Additionally, the magnitude of public charging reliability and availability issues appear to be greater in rural than non-rural areas. Grid reliability issues and specific vehicle requirements were also points of discussion among rural PEV owners. The findings of this report could inform policy makers, car manufacturers, and PEV charging companies to better serve rural communities in the transition to 100% PEV sales. |
| Keywords: | Social and Behavioral Sciences, Zero emission vehicles, electric vehicles, electric vehicle charging, travel behavior, rural areas, transportation equity |
| Date: | 2024–06–01 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:itsdav:qt9t95p3gk |
| By: | Proost, Stef; Vander Loo, Saskia |
| Abstract: | The CORSIA climate agreement requires the signatories to cap their bilateral international aviation carbon emissions to 85% of the level of 2019. Signatories can satisfy the cap by using offsets and sustainable aviation (SAF) fuels.This international agreement faces three handicaps: the agreement must be self-enforcing, very cheap offsets and SAF’s with a high indirect emission are not credible and offsets and SAF’s do not guarantee climate neutrality. We study the participation decision of a country to join or not CORSIA in a Nash context. It is shown that there are pairs of countries for whom it is beneficial to join CORSIA if their climate benefit is higher than half the cost of offsets or SAF fuels. The numerical model illustration for the 10 most important countries shows that only a few countries are likely to effectively participate and will do this via offsets rather than via SAF blends. |
| Keywords: | Aviation, climate, international climate agreement, fuel efficiency aviation, offsets, biofuels |
| JEL: | Q54 Q58 R48 |
| Date: | 2024–03–10 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121484 |
| By: | Cameron, Aliénor (Climate Economics Chair; EconomiX (Université de Paris-Nanterre); ADEME, Paris, France); Garrone, Maria (European Commission, DG GROW, Chief Economist Team (A1), Brussels, Belgium) |
| Abstract: | This paper analyses the relationship between firms' emission intensity and their corporate performance based on a constructed dataset providing detailed micro-level information of industrial firms covered by the EU ETS |
| Keywords: | EU ETS, heavy industry, emission intensity, corporate performance. |
| JEL: | D22 H23 L51 Q58 |
| Date: | 2024–05 |
| URL: | https://d.repec.org/n?u=RePEc:bda:wpsmep:wp2024/24 |
| By: | Dang, Hai-Anh H.; Do, Minh N. N.; Cuong Viet Nguyen |
| Abstract: | Very few studies have examined the impacts of both climate change and air pollution on student education outcomes, particularly in a developing country setting. Analyzing a rich database consisting of household and school surveys, test scores, and temperature and air pollution data over the past decade for Viet Nam, we find that a 1 μg/m3 increase in PM2.5 concentration in the month preceding exams leads to 0.015 and 0.010 standard deviation decreases in math and reading scores, respectively. We also find some indicative evidence of stronger impacts of air pollution for younger, primary school students who reside in urban areas and in districts with higher temperatures. While we find some mixed effects of temperature, we do not find significant effects on students' test scores for temperature extremes and air pollution over the past 12 months. Our findings offer policy-relevant inputs for the country's ongoing efforts to fight air pollution. |
| Keywords: | air pollution, climate change, weather extremes, education, Viet Nam |
| JEL: | O12 I10 Q53 Q54 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:glodps:1464 |
| By: | Gollier, Christian |
| Abstract: | This document is a newcomer guide to the economic theory of discounting, with applications to climate change and sustainability. It borrows ingredients from public economics, decision theory, and asset pricing theory, without any prerequisites beyond microeconomics 101. Aiming at sustainability issues, I focus the analysis on the valuation of intergenerational impacts. The starting point is the Ramsey rule, now more than a century old: We discount the future because we are inequality-averse and because we are used to believe that future generations will be wealthier than us. From this trivial but fundamental insight, I explore the role of uncertainty, a key ingredient for any realistic representation of the distant future of humanity on this planet. |
| Keywords: | discounting; asset price; carbon price; sustainability; climate change; deep uncertainty; Ramsey rule |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:129593 |
| By: | Zhang, Wenbei; Qiu, Feng |
| Keywords: | Resource/Energy Economics And Policy |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:344062 |
| By: | Luca TAUSCH; Guilherme MAGACHO |
| Abstract: | The low-carbon transition in developing countries requires large investments in new technologies. However, since capital goods production is concentrated mostly in more advanced economies, this transition will generate a high demand for imported Machinery and equipment in these countries, leading to a higher demand for foreign exchange and potentially creating negative macroeconomic pressures. To account for the important role of capital goods in this transition process, we endogenize fixed capital in the input-output (IO) framework, estimating capital use matrices for six developing and emerging countries in Latin America and the Caribbean within the Gloria sectoral framework from 1990 to 2020. Based on these estimates, we show how the endogenization of capital can offer a nuanced sectoral perspective on the multidimensional challenges faced by developing countries during their low-carbon transition, including the external and socio-economic dimensions. Our findings suggest that the inclusion of capital in the IO framework reveals a substantial deepening of the external constraint for developing countries. We find that for every dollar invested solely to maintain current productive capacity, on average more than 45% leaks directly and indirectly to foreign producers through imports. Some socio-economic benefits of green investment, such as employment generation, are absorbed by the rest of the world, rather than fostering domestic job creation. Essentially, with the growing demand for foreign-produced capital goods generated by the low-carbon transition, developing countries will face an increased external constraint and substantial socio-economic imbalances as they embark on their low-carbon trajectory. |
| JEL: | Q |
| Date: | 2024–07–16 |
| URL: | https://d.repec.org/n?u=RePEc:avg:wpaper:en16978 |
| By: | Afridi, Farzana (Indian Statistical Institute); Barnwal, Prabhat (Michigan State University); Sarkar, Shreya (University of California) |
| Abstract: | We study the role of the administrative design of energy subsidy programs aimed at encouraging households' transition to cleaner energy sources. Our context is the universal subsidy for clean cooking gas (LPG) in India - households first purchase LPG at the market price (over-the-counter) and then receive a 'cash-back' subsidy in their bank account. The subsidy varies with the market price such that the effective price (out-of-pocket price net of subsidy) for households does not change. Using exogenous variation in the LPG market price, which varies in tandem with the international price, and administrative data on LPG purchases by one million households, we find that a 1% increase in over-the-counter LPG price causes a 1.4% decrease in LPG purchase by low-income households, even when the effective price remains unchanged. Household survey data show that low-income households substitute away from LPG towards polluting biomass-based solid fuels by 5% in response to a 1% increase in the LPG market price. Consequently, we estimate that the 'cash-back' subsidy design may worsen neonatal mortality and other relevant health outcomes. The adverse impact of the program design on clean fuel usage weakens when households have more cash on hand, suggesting households' short-term liquidity constraint is the key explanation. Our results, thus, show that the design of energy subsidy programs, in particular the timing of transfers, may have significant implications for the energy transition of liquidity-constrained households. |
| Keywords: | subsidy, liquidity constraints, cash transfer, solid fuels, LPG |
| JEL: | H26 O17 I38 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17104 |
| By: | Franziska Flachsbarth; Anna Pechan; Martin Palovic; Matthias Koch; Dierk Bauknecht; Gert Brunekreeft |
| Abstract: | The electricity grid includes multiple network areas managed by different operators, with transmission system operators (TSOs) handling high-voltage areas and distribution system operators managing mid- to low-voltage areas. These areas are interconnected and synchronized, creating classical external effects where one operator's actions impact others. Recently, high voltage direct current (HVDC) lines have been introduced, offering operators greater flexibility and control over power flows compared to conventional alternating current (AC) lines, thereby reducing congestion and losses. However, HVDC lines can significantly affect neighbouring grids, potentially leading to strategic behaviour by network operators. This paper examines the strategic use of HVDC lines, using a model-based approach on projected 2030 market data in the German electricity system. It finds that without explicit coordination mechanisms most hours result in incentives for non-cooperative outcomes, with only three hours within one year showing incentives for a cooperative outcome. Despite lower overall system costs with cooperation, asymmetric distribution of cooperation benefits prevents long-term cooperation. Thus, cost-revenue- sharing schemes are needed to promote cooperation and balance benefits. |
| Keywords: | TSO coordination, strategic behaviour, game theory, simulation |
| JEL: | L51 L94 L43 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:bei:00bewp:0048 |
| By: | Tobias Eibinger (University of Graz, Austria); Hans Manner (University of Graz, Austria); Karl Steininger (University of Graz, Austria) |
| Abstract: | Passenger transport plays a crucial role in achieving carbon-neutrality. While a switch to zero-emission vehicles is a crucial part in this process, policy makers likely have to resort to a differentiated mix of complementary policy measures to achieve global targets on carbon-neutrality. To help policy makers design effective measures, we analyse the effect of environmental policies on CO2 emissions from passenger cars in Austria from 1965-2019. In a first step, we propose a novel environmental policy stringency index tailored to the Austrian transport sector for the period 1950-2019. In a second step, we analyse the effect of different policies on transport-related CO2 emissions in a structural vector autoregressive model. This allows us to control for possible interdependencies between the policies and remaining variables. We find that policies targeting the investment decision to buy new cars reduced emissions in Austria more significantly than policies targeting the usage of cars. The engine-related insurance tax quantitatively shows the strongest impact on emissions, while the standard fuel consumption tax shows the strongest statistical significance. |
| Keywords: | Climate change, CO2 emissions, Passenger transport, Mitigation, Policy stringency, Vector autoregression. |
| JEL: | C32 C54 Q54 Q58 R48 |
| Date: | 2024–04 |
| URL: | https://d.repec.org/n?u=RePEc:grz:wpaper:2024-10 |
| By: | Altenburg, Tilman; Kantel, Anne |
| Abstract: | Namibia is a highly competitive location for solar and wind energy, which can be utilised to produce green hydrogen and derivatives that are essential for decarbonising the global economy. Its government therefore has high hopes for this entire industrial complex, as do several European countries interested in importing green hydrogen and derivatives from Namibia. This Discussion Paper assesses the related opportunities and risks and offers policy recommendations with a view to maximising the societal benefits for Namibians. Scaling up renewables projects is a no regret option for Namibia, as there is demand for domestic electrification, clean electricity could be exported to South Africa, and using renewable to produce hydrogen and derivatives for export offers prospects for foreign exchange earnings and economic growth. Here, the most immediate opportunities lie in exporting green ammonia, yet other market opportunities may open up, including the export of sustainable aviation fuel, hot-briquetted iron and green fertiliser. At the same time, international investors are hesitant to implement their planned investments due to uncertainties regarding international offtake agreements and other risk factors, e.g. relating to shipping capacities and financial guarantees. This calls for a gradual scaling-up of hydrogen and ammonia investments, accompanied by continuous technology and market foresight, and carefully designed risk-sharing agreements with international investors. Hydrogen investments come with political and environmental risks. Politically, the sheer size of the planned projects creates incentives for socially exclusive rent-seeking deals. Unless strict transparency rules are applied, directly partaking in deals with large investors may create opportunities for legal or extra-legal enrichment. Hence, it is essential to have full transparency for tenders and contracts. Even if all deals were fully transparent, this would not guarantee widespread benefits for the Namibian people. We predict fewer employment and other socio-economic spillovers than anticipated in the country's current strategy. Also, projects may be less profitable than expected, and information asymmetries between large investors and Namibian policy-makers may translate into unfavourable risk- and benefit-sharing agreements. To ensure widely shared benefits, options for a pro-poor use of revenues from hydrogen projects should be explored to achieve socio-economic spillovers from financial investments in green hydrogen. These include direct dividend payments to citizens, earmarking of public revenues for development funds, mandatory oversizing of electricity generation and desalination to serve local communities, and co-ownership of energy projects. |
| Keywords: | Hydrogen, value chains, energy transition, industrial policy |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:diedps:300228 |
| By: | Kahrl, Fritz; Lin, Jiang |
| Abstract: | Concerns around reliability in Chinas electricity sector have rekindled interest in a traditional solution: building more coal-fired generation. However, over the past decade Chinas electricity sector has seen significant changes in supply costs, demand patterns, and regulation and markets, with falling costs for renewable and storage generation, peakier demand, and the creation of wholesale markets. These changes suggest that traditional approaches to evaluating the economics of different supply options may be outdated. This paper illustrates how a net capacity cost metric - fixed costs minus net market revenues - might be a useful metric for evaluating supply options to meet peak demand growth in China. Using a simplified example with recent resource cost data, the paper illustrates how, with a net capacity cost metric, electricity storage and solar PV may be a more cost-effective option for meeting peak demand growth than coal-fired generation. |
| Keywords: | Economics, Energy Modelling, Energy management, Energy systems |
| Date: | 2024–02–16 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:agrebk:qt83v0m2zw |
| By: | Joshua Budlender |
| Abstract: | South Africa frequently experiences rolling blackouts ('load shedding') due to shortfalls in electricity generation. This is a common problem across the developing world, and yet the developmental impacts of insufficient and unstable electricity supply, and the benefits of mitigating this, are poorly understood. I use the introduction of a unique load shedding reduction policy in parts of South Africa's second-largest city, Cape Town, to investigate the mortality effects of load shedding and its mitigation. |
| Keywords: | Electricity, Mortality, Synthetic control method, South Africa |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:unu:wpaper:wp-2024-44 |
| By: | R. ABBAS (INSEE); N. CARNOT (INSEE); M. LEQUIEN (INSEE); A. QUARTIER-LA-TENTE (INSEE); S.ROUX (INSEE) |
| Abstract: | Avec un modèle de choix optimal d’investissement – ou d’échouage – en capital brun, émetteur de gaz à effet de serre, ou vert, sans émissions, nous décrivons les transitions optimales vers la neutralité carbone qui respectent des contraintes climatiques de type plafonds ponctuels d’émissions (Fit for 55) ou budget carbone. Nous montrons que : i) un échouage anticipé ne peut pas se produire avec des cibles ponctuelles ; ii) pour limiter le réchauffement à un niveau donné, introduire explicitement cette contrainte sous la forme d’un budget carbone restant minimise le coût économique associé, induisant un échouage initial élevé avec des budgets limités. Des plafonds d’émissions réguliers dès la première année, et choisis à partir des émissions de cette trajectoire optimale, entraînent une trajectoire proche ; iii) à cumul d’émissions donné, retarder la transition augmente les coûts et l’échouage ; iv) l’investissement total durant et après la transition est inférieur à celui de l’état initial. Tous les codes utilisés sont disponibles sous https://github.com/InseeFrLab/DT-way-to- net-zero. |
| Keywords: | transition écologique, budget carbone, neutralité carbone, capital échoué, investissements |
| JEL: | Q54 Q58 E20 C61 P18 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:nse:doctra:2024-11 |
| By: | Claudio Vitari (CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon); Zakaria Laala (CERGAM - Centre d'Études et de Recherche en Gestion d'Aix-Marseille - AMU - Aix Marseille Université - UTLN - Université de Toulon) |
| Abstract: | The traditional model of academic publishing, characterized by paid subscriptions, has historically restricted access to research findings, posing barriers for researchers and institutions with limited resources (Suber, 2012). In response, the open access (OA) movement has gained momentum, advocating for free and unrestricted access to scholarly literature online, thereby promoting transparency and equitable knowledge dissemination (Suber, 2012). This literature review examines the economic, social, and environmental impacts of various OA journal models, encompassing gold, green, hybrid, and emerging diamond routes. The economic impact of OA models, including cost structures and funding mechanisms such as Article Processing Charges (APCs), is analyzed to understand their implications for publishers, authors, and institutions (Björk et al., 2017; Morrison, 2017). Socially, OA fosters inclusivity by removing financial barriers and enhancing global scientific collaboration, thus democratizing access to knowledge (Houghton & Swan, 2011; Hilton III, 2016). However, the environmental footprint of OA remains underexplored, with emerging concerns over digital sustainability and carbon emissions associated with online publishing (Bouffard et al., 2022). Methodologically, this review synthesizes findings from 20 selected articles using systematic search queries and inclusion criteria based on economic, social, and ecological dimensions (Van Ooijen et al., 2023). By employing a comprehensive framework, we assess the state of knowledge regarding OA impacts and propose future research directions to optimize its benefits while mitigating potential drawbacks. Ultimately, this review underscores the transformative potential of OA in reshaping scholarly communication and calls for continued empirical research to inform evidence-based policy and practice in academic publishing. |
| Keywords: | Open access peer-reviewed articles publishing models degrowth, Open access, peer-reviewed articles, publishing models, degrowth |
| Date: | 2024–06–18 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04633659 |
| By: | Cian Montague; Kilian Raiser; Moongyung Lee |
| Abstract: | The rapid and deep emissions reductions needed to keep global warming to 1.5°C rely critically on an immense scaling-up of investment in clean energy technologies. The cost of capital plays a key role in determining investment decisions and, when elevated, can pose a significant barrier to accelerated climate action. The high capital expenditure needs of clean energy technologies make them more vulnerable to changes in the cost of capital than fossil fuel alternatives. This paper provides an overview of the cost of capital as a barrier to clean energy investment and depicts the key risk factors that determine the cost of capital for specific investments. It shows how, particularly in developing countries and for new and emerging technologies, a high cost of capital can significantly stifle investment, and calls on governments to implement better risk sharing mechanisms to overcome this barrier. |
| Keywords: | clean energy investment, clean energy technologies, climate policy, developing countries, finance |
| JEL: | E22 E43 O14 Q25 Q42 Q48 Q54 Q58 |
| Date: | 2024–07–19 |
| URL: | https://d.repec.org/n?u=RePEc:oec:envaaa:245-en |
| By: | Tobias Angel (Università degli Studi Roma Tre and Université Paris Cité); Alexandre Berthe (Université Rennes 2 and LiRIS); Valeria Costantini (Università degli Studi Roma Tre and SEEDS); Mariagrazia D’Angeli (Università degli Studi Roma Tre and SEEDS) |
| Abstract: | This paper presents new results on the identification of heteroskedastic structural vector autoregressive (HSVAR) models. Point identification of HSVAR models fails when some shifts in the variances of the structural shocks are suspected to be statistically indistinguishable from each other. This paper presents a new strategy that allows researchers to continue using HSVAR models in this empirically relevant case. We show that a combination of heteroskedasticity and zero restrictions can recover point identification in HSVAR models even in the absence of heterogeneous variance shifts. We derive the identified sets for impulse responses and show how to compute them. We perform inference on the impulse response functions, building on the robust Bayesian approach developed for set-identified SVARs. To illustrate our proposal, we present an empirical example based on the literature on the global crude oil market, where standard identification is expected to fail under heteroskedasticity. |
| Keywords: | Inequality, Redistribution, Emissions, Climate Change, Social Protection |
| JEL: | C33 D63 H23 Q54 |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2024.14 |
| By: | Danopoulos, Evangelos; Shah, Aarushi; Schneider, Claudia; Aston, John |
| Abstract: | Scientific studies often put forward policy recommendations (PRs) to bridge the gap between science and policy making. Climate change is one of the areas that PRs can be useful and have major impact, but only if they are based on scientific findings and are communicated trustworthily. The objective of this systematic review is to appraise the quality of PRs in the areas of green energy and transportation. Four databases (Web of Science, Scopus, GeoRef and GreenFile) were searched from 2019. Studies with an environmental focus in the areas of green energy (wind power and hydrogen energy) and transportation that included PRs for tackling climate change or reaching net zero targets were included. The novel Evidence Communication Rules for Policy (ECR-P) critical appraisal tool was used to assess the individual study quality, specifically targeting PRs. The Collaboration for Environmental Evidence Critical Appraisal Tool (CEECAT) was also used. Findings were synthesized narratively based on ECR-P. Twenty-three studies were included, most focusing on wind power, followed by hydrogen energy and transportation. The majority of studies used econometric and empirical modelling. According to CEECAT, study quality was found to be medium to poor. ECR-P was piloted and validated, the rating results indicated poor quality of PRs across all studies. The areas addressing the papers inherent bias towards advocacy against providing information and to disclose uncertainties were found to present most concerns. Communication quality was markedly better regarding study findings and conclusion than PRs. Researchers must use the same scientific rigour and reporting standards in PRs as in any other section of their studies. A reporting guideline for scientific-based PRs could be of great assistance. More research in other disciplines is needed to validate our results and provide further data. |
| Date: | 2024–07–08 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:k4ujg |
| By: | Aydin, Eren (Hertie School of Governance); Gehrsitz, Markus (University of Strathclyde); Traxler, Christian (Hertie School of Governance) |
| Abstract: | Using a stacked differences-in-differences approach, we study the effects of Low Emission Zones (LEZs) in Germany. The implementation of stage 1 and 2 LEZs, which banned the most pollution-intensive vehicles from city centers, significantly reduced PM10 concentrations. The most restrictive third stage had no detectable, additional effect. Analyzing the mechanisms behind these improvements, we find weak evidence of a 2% traffic decline inside LEZs. Exploiting novel data, our main results document small but precisely estimated effects on the local fleet composition: LEZs induced the replacement of 50, 000 older, emission-intensive diesel vehicles with newer, less polluting gasoline cars. Our estimates suggest that LEZs had lower social costs than previously estimated. |
| Keywords: | low emission zones, vehicle fleet composition, emission standards, social costs, diesel cars |
| JEL: | Q52 Q53 Q58 R40 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:iza:izadps:dp17144 |
| By: | Jérémie Pellet; Ibrahima Wade |
| Abstract: | With every passing day, countries and people are becoming more aware of the urgency of climate change, its negative consequences on the planet, and the need to adopt more sustainable practices. In this respect, it is of course crucial for the Olympic Movement to lead the way, by embracing a greater number of green initiatives and establishing a more sustainable structure for the Olympic Games. The example of Paris 2024, with its ambition from the outset to halve the carbon footprint of the previous editions and its focus on their legacy, is in this regard instructive and holds lessons for the future. However, and while it would not be desirable or probably even possible to turn back, the inclusion of this requirement in major sporting events, which should become a standard, must in no way constitute an insurmountable entry barrier to their organisation in places other than in developed countries. The work carried out on this subject in the context of the Youth Olympic Games which will be held in Dakar in 2026, the first Olympic event of this importance in Africa, forms part of this approach to accommodating a sustainable development objective for the Games, for the benefit of all the people and all the youth of the world.While the Olympic and Paralympic Games will be opening in Paris in the coming days, it appears useful to analyse how this event and the following ones can fit in with the broader international objectives shared by the member countries of the Olympic Movement and, in particular, the framework defined by the Paris Pact for People and the Planet in June 2023. |
| Keywords: | Afrique, Sénégal |
| JEL: | Q |
| Date: | 2024–07–17 |
| URL: | https://d.repec.org/n?u=RePEc:avg:wpaper:en16981 |
| By: | Saheed Bello; Rita Onolemhemhen |
| Keywords: | Carbon pricing policy, carbon emission intensity, stochastic frontier analysis, Canadian provinces |
| JEL: | Q5 C13 D24 H23 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2412 |
| By: | Nurrachmi, Rininta; Duasa, Jarita; ariffin, muhammad irwan; afroz, rafia |
| Abstract: | The purpose of the study is to examine the relationship between income inequality and environmental degradation in ASEAN-6 countries namely Indonesia, Malaysia, the Philippines, Thailand, Singapore, and Vietnam. It also provide analysis from the Islamic perspective based on result of the econometric regression. The study utilizes annual panel data from1992 until 2015 where the region suffered from high income distribution and environmental degradation. The analytical tool used in the study is Bias-Corrected Least Squared Dummy Variable (LSDVC), which is sufficient for small panel data. The methodological approach leads to two main findings. First, income inequality, measured by Gini coefficient, is contributing to environmental degradation (proxied by CO2 emission and Natural Resources Depletion) in the short- and long-run term. Other explanatory variables namely GDP per capita and energy consumption, also impact significantly on environmental degradation level in the short- and long-term. From the findings, it is recommended that greater investment is required in addressing high level of income inequality and environmental issues. Instruments in Islam such as zakat and waqf provide solution to overcome issue of high income gap and environmental degradation in ASEAN-6 countries, moreover majority of Muslim population located in ASEAN countries. Hence, collaboration should be enhanced among the ASEAN-6 countries where wealth distribution, technology and knowledge sharing from high income countries to low and middle-income in ASEAN countries to mitigate the negative impact of high income inequality and environmental issue in the region. |
| Keywords: | ASEAN, environmental degradation, income inequality. |
| JEL: | C0 C01 E6 Q56 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121513 |
| By: | Weitzel, Matthias (European Commission, Joint Research Centre, Calle Inca Garcilaso 3, 41092 Sevilla, Spain); Garaffa, Rafael (European Commission, Joint Research Centre, Calle Inca Garcilaso 3, 41092 Sevilla, Spain); Van der Vorst, Camille (European Commission, Joint Research Centre, Calle Inca Garcilaso 3, 41092 Sevilla, Spain) |
| Abstract: | Indirect effects can make the tourism sector sensitive to changes in energy prices, leading to relative larger losses in output than other economic sectors. The paper assess how energy price shocks can affect tourism in the EU |
| Keywords: | Tourism, energy price shock, CGE modelling |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:bda:wpsmep:wp2024/26 |
| By: | Yifei Cai (University of South Australia); Jamel Saadaoui (University of Paris 8); Gazi Salah Uddin |
| Abstract: | Recent increasing partisan conflicts in the US strain the relationship between the US and China, leading to a decrease in oil demand and a temporary rise in oil prices. Conversely, positive news shocks regarding Sino-U.S. political relations reduce political conflicts in the US, resulting in decreased oil demand and prices. Last, positive shocks to good and bad news have asymmetric effects on the oil market. |
| Keywords: | China, oil market, political relation news, partisan conflict, asymmetries |
| JEL: | Q |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:inf:wpaper:2024.12 |
| By: | Galina Hale; Brigid C. Meisenbacher; Fernanda Nechio |
| Abstract: | In the past two decades, a number of banks joined global initiatives aimed to mitigate climate change by “greening” their asset portfolios. We study whether banks that made such commitments have a different emission exposure of their portfolios of syndicated loans than banks that did not. We rely on loan-level information with global coverage combined with country-industry information on emissions. We find that all banks have reduced their loan-emission exposures over the last 8 years. However, we do not find differences between banks that did and those that did not signal their sustainability goals, with the exception of early signers of Principles of Responsible Investments (PRI), who already had lower exposure to emissions through their syndicated lending. In addition, banks that signed PRI shortened the maturity of the loans extended to highly-emitting industries but only temporarily. Thus, we conclude that banks reduced their exposure to climate transition risks on average, but voluntary climate commitments did not contribute to syndicated loan reallocation away from highly-emitting sectors. |
| Keywords: | climate; sustainable finance; green finance; bank lending; syndicated loans |
| JEL: | G21 F21 Q54 |
| Date: | 2024–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedfwp:98621 |
| By: | Gong Cheng; Torsten Ehlers; Frank Packer; Yanzhe Xiao |
| Abstract: | In traditional bond markets, sovereign bonds provide benchmarks and serve as catalysts for corporate bond market development. Contrary to the usual sequence of bond market development, sovereign issuers are latecomers to sustainable bond markets. Yet, our empirical study finds that sovereign green bond issuance can have quantitative and qualitative benefits for the development of private sustainable bond markets. Our results suggest that both the number and the size of corporate green bond issuance increase more in a jurisdiction after the sovereign debut. The results are more pronounced in countries with stronger climate policies. Sovereign green bond issuance also improves the quality of green verification standards in the corporate bond market more generally, consistent with the aim of fostering third-party reviews and promoting best practice in green reporting and verification. Finally, our work provides evidence that the sovereign debut increases liquidity and diminishes yield spreads of corporate green bonds in the same jurisdiction. |
| Keywords: | green bonds, sustainable bonds, sovereign debt, taxonomies, green verification, bond market development |
| JEL: | H63 O16 Q01 Q50 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:bis:biswps:1198 |
| By: | Klas Wetterberg; Jane Ellis; Lambert Schneider |
| Abstract: | This paper investigates the interplay between voluntary and compliance carbon markets, with a focus on the environmental integrity implications, in particular mitigation of greenhouse gases. It explores different types of carbon credit markets and the different ways that these markets can, and could, interact. Furthermore, the paper examines how developments in voluntary and compliance carbon markets can impact the mitigation effectiveness of carbon credit markets, including on both the supply and demand sides. The analysis finds that while carbon credit markets could unlock mitigation ambition and action, they also have significant environmental integrity risks that merit government attention. The paper suggests some guiding principles for governments in identifying how to engage with different carbon markets, and recommends that they take strategic, focused and collaborative action. The paper also highlights potential policies that could enhance environmental integrity across carbon markets. In addition to domestic carbon markets, governments could monitor how international and self-regulatory carbon market frameworks evolve. Governments can also assess the role that carbon credit markets play in achieving their climate objectives, and identify opportunities to enhance their mitigation effectiveness. |
| Keywords: | Article 6, carbon credits, carbon tax, climate change, climate mitigation, compliance carbon market, demand, emissions trading system, environmental integrity, ETS, greenhouse gas emissions, net zero, supply, voluntary carbon market |
| JEL: | F55 G14 H23 Q52 Q54 |
| Date: | 2024–07–18 |
| URL: | https://d.repec.org/n?u=RePEc:oec:envaaa:244-en |
| By: | Heckenhahn, Jonas; Feldhaus, Christoph; Löschel, Andreas |
| Abstract: | Climate change can be addressed by mitigation and adaptation approaches at the national policy level. Since only limited resources are available for both strategies, it is key to unravel how ongoing climate developments and their communication influence the population's preferences regarding the question 'adaptation or mitigation?' Based on construal level theory and the construal matching premise, we hypothesize that when individuals are faced with an abstract tradeoff between mitigation and national adaptation, a larger national short-term risk perception extends prioritization of national adaptation measures, whereas an amplified global long-term risk perception or a lifted construal level of presented climate risks increases mitigation emphasis. To explore these hypotheses, we conducted an online framed field information experiment with a German population sample of 2, 182 participants and find evidence for the hypothesized causal effects by conducting OLS regressions and mediator analyses. We argue for reevaluating current climate communication's emphasis on psychologically close damages, as this approach may push people towards favoring adaptation strategies over essential mitigation measures and could thus entail undesirable side effects. |
| Abstract: | Der Klimawandel kann auf nationalpolitischer Ebene durch Minderung und Anpassung angegangen werden. Da für beide Strategien nur begrenzte Ressourcen zur Verfügung stehen, ist es von zentraler Bedeutung, herauszufinden, wie die aktuellen klimatischen Entwicklungen und deren Kommunikation die Präferenzen der Bevölkerung hinsichtlich der Frage 'Anpassung oder Minderung?' beeinflussen. Basierend auf der Construal Level Theory und der Prämisse des Construal Matching hypothetisieren wir, dass, wenn Individuen mit einer abstrakten Abwägungsentscheidung zwischen Minderung und nationaler Anpassung konfrontiert sind, eine größere national-kurzfristige Risikowahrnehmung die Priorisierung nationaler Anpassungsmaßnahmen erhöht, während eine verstärkte global-langfristige Risikowahrnehmung oder ein erhöhtes Construal Level der dargestellten Klimarisiken den Fokus auf Minderung stärkt. Um diese Hypothesen zu untersuchen, haben wir ein Online Framed Field Information Experiment mit einer deutschen Bevölkerungsstichprobe von 2.182 Teilnehmern durchgeführt und basierend auf OLS-Regressionen und Mediatoranalysen Evidenz für die hypothetisierten kausalen Effekte gefunden. Wir plädieren dafür, die Betonung psychologisch naher Schäden in der aktuellen Klimakommunikation zu überdenken, da dieser Ansatz Menschen dazu verleiten könnte, Anpassungsstrategien gegenüber essenziellen Minderungsmaßnahmen zu bevorzugen, und somit unerwünschte Nebeneffekte nach sich ziehen könnte. |
| Keywords: | Climate change mitigation, climate change adaptation, national adaptation strategies, psychological distance, construal level theory, risk perception, climate communication, information experiment |
| JEL: | Q54 D81 Q58 D91 C93 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:rwirep:300566 |
| By: | Dang, Ruirui |
| Keywords: | Resource/Energy Economics And Policy, Environmental Economics And Policy, Community/Rural/Urban Development |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:343840 |
| By: | Willem THORBECKE |
| Abstract: | Oil prices increased 120% between 2020 and 2024. How do oil prices affect Japanese firms? Since Japan is an oil importer, oil price increases may act as a tax on Japanese firms. This would decrease their cash flows and stock prices. This paper examines how oil prices affect stock prices. Using Hamilton’s (2014) method to decompose oil prices into portions driven by aggregate demand and by oil supply, the results indicate that both demand- and supply-driven oil price increases raise Japanese aggregate stock returns. Aggregate demand-driven oil price increases benefit sectors that compete in global markets and harm sectors that depend on oil and sell to the domestic market. Supply-driven oil price increases benefit Japanese industrial firms that service the oil industry. These findings imply that, if the Japanese government wants to alleviate the burden of high oil prices, it should not provide blanket subsidies but target subsidies to sectors harmed by oil price increases. |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:eti:dpaper:24065 |
| By: | Feld, Lars P.; Hassib, Joshua |
| Abstract: | Die Kohäsionspolitik in der Europäischen Union (EU) ist weithin als Instrument zur Förderung des Aufholprozesses akzeptiert, d.h. zur Unterstützung von Mitgliedstaaten mit einem niedrigeren Bruttoinlandsprodukt (BIP) pro Kopf, um ein höheres Wirtschaftswachstum zu erzielen und so ähnlich hohe Einkommensniveaus wie Mitgliedstaaten mit einem höheren BIP pro Kopf zu erreichen. Empirische Studien liefern jedoch widersprüchliche Evidenz für den Erfolg der Strukturfonds in dieser Hinsicht. Aus politökonomischer Sicht werden die EUStrukturfonds und ihre Instrumente der Kohäsionspolitik, aber auch die EU-Agrarpolitik, als Ausgleich für die Zustimmung ärmerer Mitgliedstaaten zu weiteren Schritten der europäischen Integration interpretiert. In jüngster Zeit hat die Klimapolitik Eingang in die Kohäsionsstrategie der EU gefunden, da höhere Energiekosten aufgrund der CO2-Bepreisung die Umwandlung des bestehenden kohlenstoffintensiven in einen klimaneutralen Kapitalstock erforderlich machen könnten. Die Strukturfonds sollten daher bei der Umstellung auf die CO2-Neutralität unterstützen, damit Mitgliedstaaten nicht ins Hintertreffen geraten. Ein Beispiel dafür ist Next Generation EU (NGEU), das auf den Übergang zur Klimaneutralität abzielt. In diesem Papier werden die Ziele der EU-Kohäsionspolitik den Notwendigkeiten der Klimapolitik gegenübergestellt, um den Klimawandel zu bekämpfen. Mögliche Konflikte und Synergien zwischen den Zielen der Kohäsionspolitik und der Klimapolitik werden aufgezeigt. |
| Keywords: | Kohäsionspolitik, Klimapolitik, Binnenmarkt, Währungsunion, Multi-Level-Governance, Europäische Union |
| JEL: | F42 F55 Q58 R5 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:aluord:300649 |
| By: | Ghosh, Surajit; De Sarkar, K.; Chowdhury, A.; Holmatov, Bunyod; Rajakaruna, Punsisi |
| Abstract: | Quantifying greenhouse gas (GHG) emissions in hydropower reservoirs is linked with national and international sustainability objectives. Deploying scalable and effective cloud-based technologies improves the accessibility, reproducibility, and timeliness of the quantification process. This novel strategy promotes global sustainability in the hydropower industry while making it easier to comply with environmental regulations. It can promote informed decision-making, increase transparency, and expedite the transition to clean energy sources. Considering the use of cloud computing in GHG quantification can support global efforts to mitigate climate change and advance the development of hydropower systems into more sustainable global infrastructure. Earth Observation (EO) data with cloud computing facilities such as Google Earth Engine (GEE) and G-res (an online tool by the International Hydropower Association) can help fill in the missing data gaps and calculate GHG emissions from hydropower reservoirs in Vietnam following IPCC recommendations for estimating GHG emissions. Seven hydropower reservoirs (Ban Ve, Binh Dien, Ho Ham Thuan, Ho Hoa Binh, Ho Song Hinh, Thac Ba and Yali) from different parts of Vietnam were selected as test cases for calculating GHG emissions using the G-res tool. The initial results from the analysis show that the Binh Dien reservoir reports the highest GHG aerial emission rate per year, while the lowest has been observed for the Thac Ba reservoir. Similarly, the highest emission rate has been observed for the Ban Ve reservoir, while the lowest has been recorded for the Thac Ba reservoir. The initial results reported here provide an understanding of GHG emissions from the hydropower reservoirs (test cases) and are needed to be verified with the respective reservoir authorities for actual emissions. |
| Keywords: | Climate Change, Productivity Analysis, Sustainability |
| Date: | 2023–12–31 |
| URL: | https://d.repec.org/n?u=RePEc:ags:iwmirp:344121 |
| By: | Doroteja Mandarić (University North Croatia Author-2-Name: Prof. Dr. Sc. Anica Hunjet Author-2-Workplace-Name: University North Croatia Author-3-Name: Author-3-Workplace-Name: Author-4-Name: Author-4-Workplace-Name: Author-5-Name: Author-5-Workplace-Name: Author-6-Name: Author-6-Workplace-Name: Author-7-Name: Author-7-Workplace-Name: Author-8-Name: Author-8-Workplace-Name:) |
| Abstract: | "Objective - This research aimed to investigate potential disparities between genders in Croatia regarding their pro-environmental attitudes and mindsets, focusing on understanding how gender influences individuals' environmental consciousness and support for sustainable practices. This paper presents an empirical study utilizing survey data to examine gender differences in environmental attitudes and behaviors. Methodology - It contributes to the field of environmental sociology by exploring the role of gender in shaping individuals' responses to environmental challenges, with implications for policy development and sustainability initiatives. By employing an online survey via snowball sampling, a total of 263 adult participants from Croatia were recruited for the study. Closed-ended questions on a Likert scale measured respondents' attitudes towards recycling, waste sorting, environmental protection urgency, and health impacts of environmental issues. Findings - The findings in this research indicate that gender plays a role in influencing individuals' environmental attitudes and behaviors, with significant gender-based variations in environmental consciousness. Women exhibit higher levels of concern for environmental issues, stronger support for recycling policies, and a more positive outlook on the health implications of ecological problems. This study provides valuable insights into the connection between gender and environmentalism in Croatia, making significant contributions to existing literature. Moreover, it offers implications for the development of policies targeting environmental management and recognizing the need to influence the environmental behavior of each gender. By focusing on gender disparities in pro-environmental behaviors, the study offers new insights into the connection between gender and environmentalism, emphasizing the need for gender-sensitive approaches to environmental policymaking and intervention. Novelty - The research aims to deepen our understanding of the intersection between gender and environmental attitudes, highlighting the importance of incorporating gender-specific perspectives into efforts to promote sustainable behaviors, address environmental challenges, and foster more environmentally conscious societies in Croatia and beyond. Type of Paper - Empirical" |
| Keywords: | environmental attitudes, sustainability, eco-awareness, environmental behavior |
| JEL: | F64 J16 Q54 Q56 |
| Date: | 2024–06–30 |
| URL: | https://d.repec.org/n?u=RePEc:gtr:gatrjs:jber249 |
| By: | RÓZSAI Máté (European Commission - JRC); JAXA-ROZEN Marc (European Commission - JRC); SALVUCCI Raffaele (European Commission - JRC); SIKORA Przemyslaw (European Commission - JRC); TATTINI Jacopo (European Commission - JRC); NEUWAHL Frederik (European Commission - JRC) |
| Abstract: | The Joint Research Centre's Integrated Database of the European Energy System (JRC-IDEES) incorporates in a single database a rich set of information allowing for highly granular analyses of the dynamics of the European energy system, so as to better understand the past and create a robust basis for future policy assessments. JRC-IDEES provides a consistent set of disaggregated energy-economy-emissions data for each Member State of the European Union, covering all sectors of the energy system for the 2000-2021 period. This data complies with Eurostat energy balances while providing a plausible decomposition of energy consumption into specific processes and end uses. In each sector, JRC-IDEES uses a vintage-specific approach to quantify the characteristics of the energy-using equipment in operation, along with the average operation of the equipment stock. It accordingly identifies different drivers and provides insights on their role by sector while accounting for structural differences across countries. As such, JRC-IDEES has several key applications for energy system modelling, research, and policy analysis, such as the parameterization of energy models and the assessment of past and prospective policies. JRC-IDEES is freely accessible to the general public since 2018. This report documents the 2024 update (JRC-IDEES-2021), which is available through the JRC Data Catalogue and introduces a number of methodological refinements while extending the time coverage until 2021. |
| Date: | 2024–05 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc137809 |
| By: | Mathieu Petit; Karel Janda (Institute of Economic Studies, Charles University, Prague, Czech Republic & Department of Banking and Insurance, Faculty of Finance and Accounting, Prague University of Economics and Business) |
| Abstract: | This paper aims to estimate the optimal environmental policy in the elektricity generation sector for each of the EU countries maximizing total welfare. The study uses a recently proposed theoretical corporate finance model and empirically estimate each of its components using the current state of the literature to derive the estimated optimal investment size and greenhouse gas abatement activities. Results indicate that a social planner would not significantly reduce the carbon intensity of the EU electricity generation sector but rather keep its industry size well below current levels. |
| Keywords: | investment size, abatement activity, electricity demand, social cost of carbon, carbon intensity, marginal abatement cost curve |
| JEL: | C54 G38 Q41 Q54 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:fau:wpaper:wp2024_24 |
| By: | Mehdi Abbas (PACTE - Pacte, Laboratoire de sciences sociales - CNRS - Centre National de la Recherche Scientifique - UGA - Université Grenoble Alpes - IEPG - Sciences Po Grenoble - Institut d'études politiques de Grenoble - UGA - Université Grenoble Alpes) |
| Abstract: | Cette note de recherche analyse le nouveau mécanisme d'ajustement carbone aux frontières (MACF) de l'Union européenne pour questionner sa pertinence du triple point de vue de l'efficacité climatique, de la politique commerciale et de la stratégie de gouvernance globale de l'UE. On formule l'hypothèse que le MACF est porteur d'une gouvernance polydimensionnelle qui en explique la portée et les limites. |
| Keywords: | Union européenne multilatéralisme gouvernance climat-énergie-commerce gouvernance polydimensionnelle mécanisme d'ajustement carbone aux frontières économie politique internationale de la décarbonation transitions écologique-énergétique internationale, Union européenne, multilatéralisme, gouvernance climat-énergie-commerce, gouvernance polydimensionnelle, mécanisme d'ajustement carbone aux frontières, économie politique internationale de la décarbonation, transitions écologique-énergétique internationale |
| Date: | 2024–06–26 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04626238 |
| By: | Elkerbout, Milan (Resources for the Future); Nehrkorn, Katarina (Resources for the Future) |
| Abstract: | Climate policies that interact with international trade tend to have some administration linked to the quantification of carbon intensities in traded goods. Administrative costs—and transaction costs more broadly—can undermine trade or raise costs for society. As climate-and-trade policies, such as border adjustment mechanisms, gain in popularity, the potential for burdensome red tape also increases, especially for countries that have less developed carbon-accounting policies. “Interoperability” of carbon intensity quantification is shorthand for the ability of nations to design trade-related climate policies without creating barriers to trade in terms of administrative costs. Pursuing interoperability is a way to limit transaction costs and improve policy efficiency. Interoperability in the context of climate-and-trade policy does not mean trying to harmonize policies. Countries understandably adopt policy designs that fit their national political and economic circumstances. Interoperability should be seen more as a bottom-up process that leads to gradual alignment on methodologies and processes while allowing countries to pursue distinct policy goals and designs.The potential for administrative burdens to harm trade is well recognized. Brexit provided an almost ideal natural experiment in what happens when administrative complexity in conducting trade suddenly increases. It has led to an overall reduction in trade volumes between the European Union and the United Kingdom, and some small parties decided to stop trading altogether. Conversely, reducing barriers to trade that arise from different standards and processes (i.e., technical barriers to trade) can boost trade more than tariff reductions do.Quantifying carbon intensities involves measurement, calculation, or both. The carbon intensity of a product is often the result of a specific production process, so some of the quantification is linked to facilities. Industrial facilities are often already regulated under carbon policies. How to move from facility-based to product-level carbon accounting is one challenge in achieving interoperability.Similarly, carbon-accounting policies often come with distinct system boundaries—that is, the boundary of a production process or value chain within which greenhouse gases will be counted. These system boundaries often make sense for a domestic policy, but comparability between carbon-accounting systems using different system boundaries can be challenging. Examples include whether to include the emissions associated with consumed electricity and heat (“Scope 2” emissions) or exchanges of waste heat between industrial facilities. Under US and EU facility-level reporting (the Greenhouse Gas Reporting Program and EU Emissions Trading System, respectively), only Scope 1 emissions—the direct emissions from sources controlled by the firm—are counted, whereas environmental product declarations typically require reporting of the entire life-cycle emissions. Upstream issues such as methane leakage and emissions linked to mining are another example. Ideally, policymakers should agree on technical indicators and methodological approaches that do not impinge on the political aims of a policy, but for which mutual recognition might be feasible. Even if some broader carbon-accounting standards, guidelines, and initiatives already exist with the GHG Protocol and within the International Standardization Organization, interoperability becomes more challenging when addressing product-level accounting, reconciling significant policy differences, involving dissimilar countries. We suggest that policymakers consider the following issues as they incrementally build interoperability:Distinguish between the technical and the political. Some climate policies have goals for innovation, security or competitiveness that do not strictly target emissions reductions. This is likely to be reflected in policy design.Confidentiality and trust matter. Some data required to quantify carbon intensities is sensitive corporate data. Companies need to have trust that this data will be handled safely, both vis-à-vis competitors and regulators.Product-level carbon intensity disclosure is not yet common. Broadening carbon-accounting systems’ focus to facilities and basic and intermediate industrial goods would aid comparability and interoperability.Anticipate the challenges posed by developments in decarbonization, for example, hydrogen, carbon capture and sequestration, and mass-balancing A method for estimating a product’s carbon intensity when dealing with energy and material inputs of varying carbon intensities. accounting issues. As economies progress towards net-zero, new carbon accounting and interoperability challenges will arise—anticipate them and discuss them before they become critical.Variety is a fact of life in the climate policy world. The Paris Agreement and UN Framework Convention on Climate Change itself are based on nationally determined contributions and assume that countries move at different speeds. The potential of decarbonization technologies differs widely among regions, and the industrial clusters of the past may not be the same in the future. Hence, the pursuit of interoperability should not become a straitjacket that constrains domestic climate policy action.Perhaps the most important question to be answered in the short term—once policymakers and stakeholders agree on its importance in the first place—is where the discussion should be pursued. Of the many candidates, two organizations stand out: the Organisation for Economic Co-operation and Development (OECD) and the International Energy Agency. Both have the technical capacity to analyze and compare industrial processes, methodologies, and policies. With its Inclusive Forum on Carbon Mitigation Activities, the OECD seems to have a good setup. What is needed, however, is a truly inclusive forum where emerging and developing countries participate on equal footing. These countries potentially have the most to lose from transaction costs, and their domestic climate policy approaches tend to look different from those of countries that have the greatest incentive to pursue climate and trade policies. |
| Date: | 2024–07–17 |
| URL: | https://d.repec.org/n?u=RePEc:rff:dpaper:dp-24-11 |
| By: | Jeong, Junyoung; Cultice, Brian; Chun, Soomin; Shaffer-Morrison, C. Dale; Gong, Ziqian; Bielicki, Jeffrey; Cai, Yongyang; Irwin, Elena; Jackson-Smith, Douglas; Martin, Jay; Wilson, Robyn |
| Abstract: | Changes in the global economy and climate system have large and wide-ranging repercus- sions for local and regional economies and ecosystems. Here we focus on global-to-local linkages that are hypothesized to impact water quality outcomes within a five-state Great Lakes-Corn Belt region, which includes some of the most intensive agricultural region of the Midwest. We develop a dynamic integrated assessment model (IAM) that links the regional economy to global conditions, local land use change, and water quality outcomes and use a sce- narios framework to assess the likelihood that phosphorus reduction targets for Lake Erie are met by 2050 under a range of plausible global and regional conditions. We examine the relative role that global economic and climate conditions play in regional land use and water quality outcomes and the extent to which local land stewardship incentives and best management prac- tices (BMPs) can offset the potential negative effects of global economic and environmental changes. By integrating a regional-level forward-looking dynamic model, a state-level static computable general equilibrium model, and a local-level land use change model, this IAM en- ables a comprehensive and theoretically consistent integration from global conditions through regional and local decision-making. The model simulates five scenarios defined by distinctly different combinations of global commodity prices, CO2 prices, climate conditions, produc- tivity, population, and economic growth. Our results reveal that success in attaining the policy target is relatively uncertain and highly dependent on future economic, environmental, and policy conditions. We find that only two of the scenarios are projected to attain the 40 per- cent spring DRP and TP reduction targets nine out of ten years by the 2030’s. Other results confirm that lower commodity prices generally lead to reduced cropland acres and are mostly associated with better water quality outcomes. However greater intensification of cropland use is not associated with greater water pollution, a result that may be driven by the relatively high adoption rates for subsurface placement that are reached in later years across scenarios. Taken together, these results demonstrate the potential for local policies to incentivize BMP adoption at levels that can act as a buffer to uncertain, changing global conditions. |
| Keywords: | Climate Change, Environmental Economics and Policy, Food Consumption/Nutrition/Food Safety |
| Date: | 2024–01–05 |
| URL: | https://d.repec.org/n?u=RePEc:ags:assa24:344218 |
| By: | WEITZEL Matthias (European Commission - JRC); VAN DER VORST Camille (European Commission - JRC) |
| Abstract: | Emissions in the EU ETS have declined by 34% between 2013 and 2023. We here show emission dynamics by sector and Member State. The decline was mostly driven by emission reductions in the power generation sector, where emissions decreased by 47%. Member States with the highest reductions mostly benefited from large reductions in their power sectors. Emissions in other sectors (except aviation) also declined in recent years. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc138215 |
| By: | Duradi, Ali; Weigt, Hannes (University of Basel) |
| Abstract: | The electricity sector plays a key role in achieving zero-emission targets. The required transition will lead to substantial changes in the supply, demand, and distribution of electricity but also in stakeholder roles. Future market designs may change substantially to accommodate these changes, address challenges, and take advantage of new opportunities. This paper reviews the characteristics of future carbon-neutral electricity systems and electricity market design options. To provide a guiding framework for the literature review, we transfer the complexity of electricity systems into a three-layer structure: firstly, we analyze the papers that rely on techno-economic modeling of the physical electricity system. As a case study, we analyze various studies focusing on a decarbonized European electricity system in 2050. Secondly, we review papers that investigates the economic behavior and effects of self interest-seeking stakeholderssuch as producers, network operators, and consumers. Finally, we review papers focusing on policy and market design questions that guide policymakers to achieve a target physical asset combination while considering the behavior of stakeholders. We highlight common trends and disagreements in the literature, review the main drivers of future markets, and finally provide a mapping between those drivers, challenges, and opportunities. The review concludes that the most promising next step toward a fully comprehensive assessment approach is to combine the existing approaches across topical and disciplinary boundaries. |
| JEL: | L94 Q4 |
| Date: | 2024–06–30 |
| URL: | https://d.repec.org/n?u=RePEc:bsl:wpaper:2024/06 |
| By: | Kim, Joo Hye (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)) |
| Abstract: | 연구는 태양광 및 리튬이온 배터리 기반 BESS 산업을 중심으로, 중국 정부와 기업의 전략과 중국의 글로벌 공급망 장악에 대한 주요국의 대응을 종합적으로 분석하였다. 이를 통해 우리 업계에 미치는 영향을 파악하고, 한국 정부 및 기업이 활용할 수 있는 대응방안을 제시하였다. To achieve carbon neutrality and increase energy security, the international community is accelerating the energy transition to reduce fossil fuels and increase renewable energy. Solar power, in particular, has emerged as a fast-growing renewable energy source, as its generation costs have fallen to the level of fossil fuels and it is relatively easy to install. Demand is growing rapidly and is expected to exceed the cumulative installed capacity of coal by 2027. In addition, demand for energy storage systems (ESS) is growing in line with the expansion of renewable energy generation. Since the production of electricity from solar and wind power fluctuates depending on the amount of sunlight available and wind speeds, it is necessary to build an ESS to store the generated electricity and release it when it is needed. Among ESS, the demand for battery energy storage systems (BESS) based on lithium-ion batteries (LiB) is growing rapidly, as it is less constrained by location and can be easily dismantled and moved compared to pumped storage hydroelectricity, in which power is generated by utilizing altitude differences in locations such as reservoirs. The problem is that China accounts for 74.7-96.8% of capacity at each stage of the global solar supply chain, and about 70% of capacity in the upstream and midstream of the LiB-based BESS supply chain. (the rest omitted) |
| Keywords: | energy transition; solar power supply chain; ESS; BESS; China |
| Date: | 2024–07–15 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kiepre:2023_008 |
| By: | Frondel, Manuel; Thiel, Patrick; Vance, Colin |
| Abstract: | Exploiting exogenous variation in retail fuel prices from a temporary fuel tax discount in Germany, we estimate how the pass-through of the discount varies over space and time. We draw on daily gasoline prices of virtually all gas stations in Germany and neighboring France, with France serving as a control, and estimate an event study model covering the full period of the discount from June to August 2022. We find average pass-through rates on the order of 87% for diesel and 71% for petrol, but with substantially lower rates in high-income regions and in regions with a low degree of competition. More strikingly, our results suggest pronounced heterogeneity over time: The magnitude of the pass-through rate dissipates sharply over the three months in which the discount was in effect, dropping to 50% by the final month, a pattern consistent with retailer responses to short-term changes in consumer attention. Taken together, our results indicate that average pass-through estimates may obscure a high degree of spatial and temporal heterogeneity that bears upon the assessment of competition and distributional effects: While our estimation of the budgetary costs of the discount confirms the government's a priori estimate of €3.1 billion, we find that about 61% of the discount's financial relief accrues to households with above-median incomes. |
| Abstract: | Unter Ausnutzung exogener Schwankungen der Einzelhandelspreise für Kraftstoffe, die sich aus einer zeitlich begrenzten Ermäßigung der Kraftstoffsteuer in Deutschland ergeben, schätzen wir, wie sich die Weitergabe der Ermäßigung über Raum und Zeit verändert. Wir greifen auf die täglichen Benzinpreise von praktisch allen Tankstellen in Deutschland und dem benachbarten Frankreich, wobei Frankreich als Kontrollgruppe dient, zurück und schätzen ein Event-Study-Modell, das den gesamten Zeitraum des Rabatts von Juni bis August 2022 abdeckt. Wir finden durchschnittliche Überwälzungsraten in der Größenordnung von 87 % für Diesel und 71 % für Benzin, wobei die Raten in Regionen mit hohem Einkommen und in Regionen mit geringem Wettbewerb deutlich niedriger sind. Noch auffälliger ist, dass unsere Ergebnisse auf eine ausgeprägte Heterogenität im Zeitverlauf hindeuten: Die Höhe der Weitergabequote nimmt im Laufe der drei Monate, in denen der Rabatt in Kraft war, stark ab und sinkt bis zum letzten Monat auf 50 %, ein Muster, das mit den Reaktionen der Einzelhändler auf kurzfristige Veränderungen der Verbraucheraufmerksamkeit übereinstimmt. Insgesamt deuten unsere Ergebnisse darauf hin, dass die Schätzungen des durchschnittlichen Pass-Through ein hohes Maß an räumlicher und zeitlicher Heterogenität verdecken können, die sich auf die Bewertung der Wettbewerbs- und Verteilungseffekte auswirkt: Während unsere Schätzung der Haushaltskosten des Rabatts die A-priori-Schätzung der Regierung von 3, 1 Milliarden Euro bestätigt, stellen wir fest, dass etwa 61% der finanziellen Entlastung durch den Rabatt Haushalten mit überdurchschnittlichem Einkommen zugute kommt. |
| Keywords: | Competition, demand elasticity, fuel tax discount, gasoline market |
| JEL: | L13 L81 D43 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:rwirep:300564 |
| By: | Bosio, Andrea Odille; Croce, Annalisa; Toschi, Laura; Ughetto, Elisa |
| Abstract: | This paper highlights the main challenges faced by the Cleantech sector. Key barriers include limited access to external finance, with many respondents expecting to raise significant funds in the next five years. Additionally, stringent and uncertain standards and regulations create operational challenges. Expanding our understanding of the Cleantech sector can enhance targeted support schemes to accelerate clean technology adoption, reduce greenhouse gas emissions, and improve environmental sustainability. This is the latest paper resulting from a project on "The cleantech industry in the European Green Deal: policy challenges and the finance landscape for SMEs" (CLEU), initiated by EIF's Market Assessment and Research Division. Funded by the EIB Institute's University Research Sponsorship (EIBURS) programme, the project aims to enhance our understanding of the Cleantech sector and improve the design of support schemes to accelerate the green transition in the EU. The EIF Working Papers are designed to make available to a wider readership selected topics and studies in relation to EIF's business. The Working Papers are edited by the EIF and are typically authored or co-authored by EIF staff or are written in cooperation with EIF. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:eifwps:300656 |
| By: | Anne Épaulard (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po); Paul Malliet (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po); Anissa Saumtally (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po); Xavier Timbeau (OFCE - Observatoire français des conjonctures économiques (Sciences Po) - Sciences Po - Sciences Po) |
| Abstract: | L'Union européenne (UE) s'est engagée dans une transition écologique ambitieuse via le Pacte vert européen qui vise à atteindre la neutralité carbone d'ici 2050. Ce Policy brief examine les politiques environnementales mises en place par la Commission von der Leyen et analyse leur impact sur l'économie et les sociétés européennes. Le Pacte vert inclut des mesures pour réduire les émissions de gaz à effet de serre, promouvoir l'économie circulaire et protéger la biodiversité. Bien que des progrès aient été réalisés, tels que la diminution des émissions et l'augmentation des investissements dans les technologies vertes, plusieurs défis subsistent, comme l'illustre la crise énergétique que les États membres ont dû affronter à la suite de la seconde invasion de l'Ukraine par la Russie, dans l'urgence et sans forcément le degré de coordination qui pouvait être attendu. Par ailleurs, le contexte économique international n'est pas foncièrement favorable à l'approche régulationniste portée par l'UE. Il est de plus en plus marqué par une confrontation croissante entre les deux géants économiques que sont les États-Unis et la Chine et qui se décline par la mise en œuvre de politiques de décarbonation fondées sur la subvention massive de leur industrie domestique. Pour surmonter ces défis, il est important pour l'UE d'augmenter les investissements publics et privés dans les infrastructures durables, de réviser les cadres réglementaires pour encourager l'innovation et de renforcer la coopération internationale. La transition écologique en Europe est à un carrefour critique, et la réussite de cette démarche dépendra de la capacité des gouvernements nationaux et des institutions communautaires à collaborer afin de trouver des accords qui, sans pénaliser les populations, permettent de garder le cap dessiné par le Pacte vert. Recommandations : ■ Maintenir l'effort d'investissement vers les technologies décarbonées dans le temps en cohérence avec la stratégie industrielle européenne déployée et accroître celui vers la recherche et le développement, nécessaires à la réussite de nos objectifs de long terme ; ■ Procéder dans le cadre de la réforme du marché de l'électricité à un effort de subvention massif des énergies renouvelables pour permettre de faire converger les prix de l'électricité pratiqués dans l'UE (28 c/kWh) vers ceux des États-Unis (16 c/kWh) ; ■ Accroître la dotation du Fonds social pour le climat pour le volet compensation, et ce afin de ne pas pénaliser les populations et les activités particulièrement exposées à l'introduction de l'ETS2 portant sur les activités de transport et de chauffage. |
| Keywords: | Transition écologique |
| Date: | 2024–06–21 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04622328 |
| By: | Matthies, Ellen; Beer, Katrin; Böcher, Michael; Sundmacher, Kai; König-Mattern, Laura; Arlinghaus, Julia; Bloebaum, Anke; Erben, Melanie Jaeger; Kaiser, Florian; Schmidt, Karolin |
| Abstract: | Due to the urgent need for global climate change mitigation, the use of renewable carbon sources and the application of circular economy principles represent promising ways to implement the necessary fundamental transformation toward a sustainable (i.e., carbon-neutral) carbon-based chemical industry. As this required transformation involves a multitude of stakeholders and requires broad societal support, social sciences have to be involved to inform possible transformation pathways. Although there is a growing body of social sciences research in the field of a circular plastics economy, some processes in the social sciences that have the potential to support the transformation process are still understudied. Based on a reflection of the current circular economy approach, we point out research needs in the following fields: (1) behavioral plasticity of consumer behaviors and potential side effects of mitigation strategies, (2) the dynamics of political framework conditions, and (3) the citizens’ literacy as relevant supporters of the transformation. We conclude that social sciences-related circular economy research is just beginning to understand the needs and willingness of actors involved in the transformation toward a sustainable carbon-based chemical industry, clearly implying the need for further contributions from the social sciences. |
| Date: | 2024–07–11 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:tgbcv |
| By: | Missbach, Leonard; Steckel, Jan Christoph; Renner, Sebastian; Kraus, Sebastian |
| Abstract: | Past periods of industrial development have gone hand in hand with the burning of coal, but there is little evidence on the effects of coal infrastructure on manufacturing growth in today's industrializing economies. We quantify the direct and indirect effects of coal-fired power plant commissioning on local incumbent manufacturing firms in Indonesia during a coal phase-in period between 1984 and 2015. We analyze spatially and temporally explicit manufacturing and power plant data in a stacked difference-in-difference framework. Leveraging quasi-random variation in treatment timing, we show that coal-fired power plants have led incumbent larger firms to increase employment, inputs, and outputs. In contrast, smaller firms remained unaffected. We identify mediating channels including improved electricity supply and transportation infrastructure, and increased competition for labor. Ongoing efforts to reduce global coal capacity need to take such effects into account. |
| Keywords: | Coal, Manufacturing, Industrialization, Indonesia, Difference-in-difference |
| JEL: | C55 L60 O12 O14 O53 Q40 R11 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:300209 |
| By: | Myers, Erica; Puller, Steven L; West, Jeremy |
| Abstract: | Mandatory disclosure policies are implemented broadly despite sparse evidence that they improve market outcomes. We study the effects of requiring home sellers to provide buyers with certified audits of residential energy efficiency. Using similar nearby homes as a comparison group, we find that this requirement increases price premiums for energy efficiency and encourages energy-saving investments. We additionally present evidence highlighting the market failure—incomplete information by both buyers and sellers—that prevents widespread voluntary disclosure of energy efficiency in housing transactions. Our findings support that disclosure policies can improve market outcomes in settings with symmetrically incomplete information. (JEL D83, K32, L98, Q41, Q48, R31) |
| Keywords: | Economics, Applied Economics, Affordable and Clean Energy, Banking, finance and investment, Applied economics |
| Date: | 2022–11–01 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:ucscec:qt0nw2m1n4 |
| By: | Rachel Lee; Hugo Rojas-Romagosa; Iulia Ruxandra Teodoru; Xiaoxiao Zhang |
| Abstract: | This study empirically investigates the impact of the climate transition on the French financial sector using a micro-macro approach to examine the long-term effects of climate mitigation and decarbonization policies on sectoral output and the effects on firm profitability and the likelihood of corporate defaults. We employ a recursive-dynamic, multi-regional, multi-sectoral computable general equilibrium (CGE) model to simulate the Fit-for-55 climate scenario and then integrate the sectoral output paths derived from the model into firm-level corporate balance sheets and risks. We then assess the extent of credit exposure of banks to energy-intensive sectors. Our findings indicate that, under the Fit-for-55 scenario, the mining, chemicals and manufacturing sectors might face notable increases in their probability of defaults, in turn creating pockets of vulnerabilities in some parts of the banking system depending on their exposure to these energy-intensive sectors. This highlights the importance for a timely and orderly transition, including integrating climate transition plans into the prudential framework. |
| Keywords: | Climate risk analysis; financial stability; ENVISAGE model; Fit-for-55 |
| Date: | 2024–07–12 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2024/144 |
| By: | Bobtcheff, Catherine; De Donder, Philippe; Salanié, François |
| Abstract: | We set up a static model of electricity provision in which delivery to consumers is only imperfectly reliable. Blackouts can be either rolling or systemic; in both cases a price cap has to be imposed on the wholesale market. We characterize optimal allocations and we show that for any given value of the price cap on the wholesale market, one can decentralize these allocations thanks to two types of regulatory instruments: a retail tax, and capacity subsidies. Some properties follow. If demand is affected by multiplicative shocks only, capacity subsidies are exactly financed by the revenues from the retail tax. If moreover the distribution of systemic blackouts is exogenous, a price cap is sufficient, provided it is set at the value of lost load. In all other cases, all instruments are needed, and capacity subsidies need to be differentiated, based on the correlation between available capacity and its social value. |
| Keywords: | Electricity; Reliability; Renewables; Climate Change |
| JEL: | D24 Q41 Q42 Q48 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:tse:wpaper:129615 |
| By: | King Abdullah Petroleum Studies and Research Center (King Abdullah Petroleum Studies and Research Center) |
| Abstract: | CO2 emissions from aviation are a priority for policymakers, researchers, entities, and governments worldwide. Traditional approaches to analyzing the aviation sector must be modified because aviation practices are no longer supply driven. In fact, the recent increase in environmental awareness worldwide has modified previous motorized-oriented approaches to be more energy efficient by investigating how the system is designed rather than considering the provision of infrastructure. |
| Keywords: | Aviation oil consumption, Aviation oil demand, Crude oil, Diesel |
| Date: | 2023–04–18 |
| URL: | https://d.repec.org/n?u=RePEc:prc:wbrief:ks--2022-wb09 |
| By: | Yildiz Noorda, Aylin |
| Abstract: | Abstract Terrestrial mining plays a critical role in the green energy transition by supplying essential metals and minerals for infrastructure and technologies such as batteries, wind turbines, and solar panels. However, current and planned mines are insufficient to meet the global demand, reliance on a few select regions to supply the world with these products carry risks, and harmful environmental, social, and governance impacts of terrestrial mining persist (IEA, 2021; RMF, 2021). In this context, alternatives to terrestrial mining are gaining prominence, notably deep seabed mining, which might commence in areas beyond national jurisdiction as early as 2026. Yet, the regulatory framework for sustainable management of deep seabed mining remains incomplete, with significant gaps in understanding its impact on biodiversity and ecosystems (IUCN, 2024). Another emerging alternative is outer space mining, which is still in its nascent stages of technical feasibility. Mining this new frontier promises substantial advancements in space exploration, and, eventually, the supply of critical metals and minerals crucial for achieving and maintaining net-zero emissions. Since 2015, four countries – the United States (US), Luxembourg, the United Arab Emirates (UAE) and Japan – enacted legislations that allow companies to explore, extract, use, and own space resources, laying the grounds for a space mining industry to flourish. Moreover, forty countries committed to cooperating for “a new era for space exploration and utilisation”, including space mining, through the Artemis Accords signed in 2020. These developments indicate the emergence of a fragmented regulatory approach to space mining activities, lacking guarantees of an international minimum standard of conduct. Such fragmentation risks jeopardising the long-term sustainability objectives for outer space, as actors with expertise might exploit the pluralist context to benefit from legal entitlements and shape specialised regulatory regimes. This working paper argues for early international regulatory intervention to promote the sustainability of space mining activities. Specifically, we advocate for adopting a due diligence standard of conduct, outlining policy options that encompass both institutional and non-institutional solutions. About the authors Dr Aylin Yildiz Noorda is a postdoctoral researcher at the Lisbon Public Law Research Centre, University of Lisbon, funded by the Swiss National Science Foundation (SNSF). She is also a non-resident research fellow at the WTI and a member of the Oeschger Centre for Climate Change Research (OCCR) of the University of Bern (email: aylin.yildiz@wti.org). Dr Ksenia Polonskaya is an assistant professor at the Department of Law and Legal Studies, Carleton University, Ontario, Canada (email: kseniapolonskaya@cunet.carleton.ca). Dr Merve Erdem Burger is a postdoctoral researcher at the Chair of Public International Law, Faculty of Law, University of Neuchâtel, funded by the SNSF (email: merve.erdem@unine.ch). |
| Date: | 2024–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:wti:papers:1442 |
| By: | Bloebaum, Anke; Schmidt, Karolin; Böcher, Michael; Arlinghaus, Julia; Krause, Friederike; Matthies, Ellen |
| Abstract: | The overall research objective of the present study is the investigation of the effects of a strongly expressed restriction-oriented climate change mitigation heuristic (SER heuristic) on people's attitudes towards and acceptance of climate change mitigation technologies such as Carbon Capture and Utilization (CCU). Furthermore, we want to examine the effects of a scenario-based communication intervention approach on the promotion of a supportive attitude towards and acceptance of CCU, especially referring to people characterized by a SER heuristic. Against this background, we present empirical findings based on an online experiment including a scenario-based intervention in an initial sample of 401 German participants. In line with our expectations, our findings show that participants characterized by a SER heuristic report a significantly lower supportive attitude towards CCU as well as a lower acceptance of CCU, compared to participants who are not characterized by a SER heuristic. Furthermore, our findings imply the examined scenario-based communication intervention approach to be an effective tool for the promotion of participants’ supportive attitudes towards CCU and acceptance of CCU. Taken together, the present study provides further valuable insights for the promotion of people’s supportive attitude towards as well as of their acceptance of necessary new climate change mitigation technologies such as CCU. |
| Date: | 2024–07–11 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:dqt4u |
| By: | Mr. JaeBin Ahn |
| Abstract: | Can a carbon tax reduce inflation volatility? Focusing on fuel excise taxes, this paper provides systematic evidence on their role as a shock absorber that helps mitigating the impact of global oil price shocks on domestic inflation. Exploiting substantial variation in fuel tax rates across 28 OECD countries over the period from 2014 to 2021, a simple idea that a per-unit, specific tax takes up a portion of the product price immune to cost shocks goes a long way toward explaining heterogeneity in the degree of oil price pass-through into domestic inflation across countries. A back-of-the-envelope calculation from the estimation results supports its quantitative significance---differences in fuel tax rates could explain about 30% of the variation in annual headline CPI inflation rates observed between the U.S. and U.K. during the 2021 inflation surge. |
| Keywords: | Fuel excise tax; gasoline tax; diesel tax; oil price pass-through; retail fuel price; inflation; greenflation; greensulation |
| Date: | 2024–07–12 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2024/153 |
| By: | Nate Vernon |
| Abstract: | France has taken a leadership role in global mitigation and made significant progress towards reducing greenhouse gas emissions, but further efforts will be needed to meet domestic mitigation targets. Accelerating emissions reductions from road transportation will be a key part of this strategy, as they account for nearly one-third of national emissions. At the same time, with the shift to more lightly taxed electric vehicles over the next decade, fiscal revenue from the sector is projected to decline and externalities, such as congestion, to worsen. Building on existing policies, a comprehensive reform that combines revenue-neutral continuous feebate schemes with a gradual introduction of road user and congestion charges could support mitigation targets, while maintaining revenue and regulating externalities. This paper discusses administratively feasible options to introduce such policies as well as key welfare and distributional considerations. |
| Keywords: | France; efficient fuel prices; climate change; road transportation economics; congestion; fiscal; environmental policy |
| Date: | 2024–07–12 |
| URL: | https://d.repec.org/n?u=RePEc:imf:imfwpa:2024/145 |
| By: | Schaube, Philipp |
| Abstract: | This article aims to shed light on the contextual embeddedness of the diffusive dynamics of onshore wind energy in Argentina by employing the integrated MLP-TIS framework. Based on the methodology of constellation analysis, this paper analyses the various stages of development of onshore wind energy in Argentina since 1990. The objective is to investigate how exogenous dynamics have hindered or promoted the dissemination of wind energy in Argentina. Thereby, beyond the empirical findings, this study contributes to the growing body of sustainability transitions research. The results provide evidence of a variety of socio-technical niches across the five development phases of the focal TIS: pilot projects, self-generation by energy cooperatives, projects based on feed-in tariffs, state financed and operated wind farms, hydrogen production and compliance with legal requirements for large users. A key insight of this research is that the classification of the development phases of the technology trajectory in Argentina is particularly related to the effects of contextual factors. With the construction of South America's first wind farm in 1990, Argentina was the pioneer of wind energy in Latin America for almost a decade. This initial positive development was facilitated by a constellation of specific framework conditions: Stable exchange rates, liberalisation and privatisation of electricity markets, and subsequently wind energy as a business model for energy cooperatives. Moreover, since the 2000s, renewable energy has been perceived as part of the solution to the national energy crisis. However, the Argentine case also illustrates how, during later development phases, structural problems within the country, such as political instability or macroeconomic uncertainties, hampered access to international project finance and thus severely affected the further development of wind energy. Discontinuities in the basic orientation of the country's economic policy resulting from changes in government were identified as another relevant contextual factor. |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:wuppap:300574 |
| By: | Best, Frank; Tang, Anita |
| Abstract: | Climate change, a transnational issue, necessitates international collaboration for effective mitigation. Despite the progress achieved by the Paris Agreement of 2015, a significant milestone in global cooperation, its implementation remains a challenge for both the international community and individual countries. Because of the agreement's optional nature, there are significant differences in terms of the ambition and achievement levels among signatories. The European Union (EU) stands out because of its unique structure and common policies, yet there is a lack of empirical research into their impact on climate policy effectiveness. This paper aims to fill this gap by comparing the effectiveness of the implementation between EU and non-EU countries in terms of policy output, achieving climate targets and an economically sustainable transition. Quantitative regression models show no significant differences concerning policy output and the achievement of climate targets, while they demonstrate greater ambition and success in economically sustainable transition. Our findings contribute to a better understanding of effective climate policies, highlight the positive impact of EU leadership in this regard, and stress the importance of international cooperation. |
| Keywords: | climate change policy, climate policy effectiveness, ambition gap, implementation gap, paris agreement |
| JEL: | Q58 F68 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:300280 |
| By: | King Abdullah Petroleum Studies and Research Center (King Abdullah Petroleum Studies and Research Center) |
| Abstract: | In May 2022, the King Abdullah Petroleum Studies and Research Center (KAPSARC) and King Abdullah University of Science and Technology (KAUST) co-organized an event titled “Advancing the Circular Carbon Economy in Saudi Arabia.” The one-day event, which comprised a high-level event and a workshop, took stock of progress in the circular carbon economy (CCE) in the Kingdom to date and implementation plans going forward. It also sought to draw attention to the role of research in supporting planning and implementation for the CCE across the public and private sectors. |
| Keywords: | Air conditioning, Applied general model, Article 6, Circular carbon Economy |
| Date: | 2023–05–10 |
| URL: | https://d.repec.org/n?u=RePEc:prc:wbrief:ks--2022-wb10 |
| By: | LEE, Jukwan (KOREA INSTITUTE FOR INTERNATIONAL ECONOMIC POLICY (KIEP)) |
| Abstract: | This paper discusses the emergence of climate clubs as a new form of international cooperation to address climate change and its implications for trade policy. Climate clubs are presented as a potential solution to overcome the limitations of multilateral efforts and unilateral climate-trade measures. The paper explores the concept of climate clubs, examines real-world examples like the G7 Climate Club and the Global Sustainable Steel and Aluminum Agreement, and analyzes their potential economic impacts using simulation models. It also presents findings from interviews with domestic industries in South Korea regarding their perspectives on climate clubs. |
| Keywords: | Climate Clubs; trade policy; international cooperation |
| Date: | 2024–06–27 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kiepwe:2024_019 |
| By: | Lee, Young Gwan; Elbakidze, Levan |
| Keywords: | Environmental Economics And Policy |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:343835 |
| By: | King Abdullah Petroleum Studies and Research Center (King Abdullah Petroleum Studies and Research Center) |
| Abstract: | Phantom oil is oil that is deliberately moved from legally recognized sources or traded in the black market. It is also frequently referred to as illegal, illicit, tacit, or unregistered oil. This oil is generally concealed from the energy community for various reasons, including to evade sanctions and to profit from cross-market price differentials. This arbitrage opportunity can be attributed to the existence of price incentives, taxes, and loose institutional structures. |
| Keywords: | Agreement, Allocations, Commodities, Companies |
| Date: | 2023–03–26 |
| URL: | https://d.repec.org/n?u=RePEc:prc:wbrief:ks--2022-wb07 |
| By: | OECD |
| Abstract: | This paper explores the longer- and shorter-term challenges of the energy markets and their competition policy implications. It considers why wholesale natural gas and electricity prices have risen so much and the public policy responses to high energy prices. It was prepared as a background note for discussions on “Competition in Energy Markets” held at the November 2022 session of the OECD Competition Committee’s Working Party No. 2 on Competition and Regulation. |
| Date: | 2022–11–24 |
| URL: | https://d.repec.org/n?u=RePEc:oec:dafaac:290-en |
| By: | Italo Colantone; Gianmarco I. P. Ottaviano; Tom Schmitz |
| Abstract: | This paper shows how to combine microeconometric evidence on the effects of environmental policy with a macroeconomic model, accounting for general equilibrium spillovers that have mostly been ignored in the literature. To this end, we study the effects of a recent US air pollution policy. We use regression evidence on the policy's impact across industries and local labor markets to calibrate a quantitative spatial model allowing for general equilibrium spillovers. Our model implies that the policy lowered emissions by 11.1%, but destroyed approximately 250'000 jobs. Ignoring spillovers overestimates job losses in polluting industries, but underestimates job losses in clean industries. |
| Keywords: | environmental policy, employment, trade, clean air act |
| Date: | 2024–07–09 |
| URL: | https://d.repec.org/n?u=RePEc:cep:cepdps:dp2016 |
| By: | Epstein, Lucas; Muehlegger, Erich |
| Abstract: | In 2018, California voters rejected Proposition 6, a ballot initiative that sought to repeal state gasoline taxes and vehicle fees enacted as part of the 2017 Road Repair and Accountability Act. This paper examines the relationship between support for the proposition, political ideology and the economic burdens imposed by the Act. For every hundred dollars of annual per-household costs imposed by the Road Repair and Accountability Act, support for proposition rose by 3–5 percentage points, roughly comparable to a commensurate increase in the share of ”liberal” voters. Notably, the relationship between voting and the economic burden of the policy is seven times strong in the most conservative tracts relative to the most liberal tracts. This heterogeneity has important implications for the popular support for environmental taxes, as conservative areas in California and elsewhere tend to bear a higher burden from transportation and energy taxes than liberal areas. View the NCST Project Webpage |
| Keywords: | Social and Behavioral Sciences, Transportation taxes, Political economy, Voting |
| Date: | 2024–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:itsdav:qt6k58771s |
| By: | Mona Yaghoubi (University of Canterbury); Reza Yaghoubi |
| Abstract: | This paper examines the impact of crude oil price changes on corporate environmental responsibility among U.S. non-oil and gas producer firms from 2002 to 2020, focusing on the asymmetric effects of oil price volatility. We distinguish between volatility due to increases or decreases in oil prices and find that a one standard deviation increase in oil volatility from positive price changes leads to a 12.7% decrease in environmental score, while the same increase from negative changes results in only a 5.5% decrease. Financial constraints are identified as a potential channel through which oil price volatility influences environmental activities. Specifically, a one standard deviation increase in oil volatility from positive price changes leads to an 18% decrease in environmental score for firms with high financial constraints, compared to an 8% decrease for firms with low financial constraints. Our findings are robust to sector differences and a 2SLS model addressing potential endogeneity. |
| Keywords: | Crude oil price uncertainty, asymmetric effect, corporate environmental responsibility, financial constraints |
| JEL: | Q41 Q56 G31 G32 |
| Date: | 2024–07–01 |
| URL: | https://d.repec.org/n?u=RePEc:cbt:econwp:24/11 |
| By: | Ofori, Pamela E.; Ofori, Isaac K.; Annan, Kenneth |
| Abstract: | Progress in energy equity, income equality, and environmental quality are fundamental to sustainable development. However, studies providing evidence-based recommendations concerning the joint effect of energy equity and income inequality on environmental sustainability in Africa are lacking. This study fills this gap by using a panel dataset covering 41 African countries from 2008-2019. Results from the Driscoll-Kraay standard errors and the dynamic system GMM estimators reveal the following: (1) energy equity promotes environmental quality, whereas income inequality hampers it, and (2) income inequality nullifies the favourable environmental gains of energy equity. These findings remain consistent when we use the ecological footprint as an alternative measure of environmental quality. We conclude that addressing income inequality is essential for ensuring that energy equity enhances environmental quality. Policymakers should prioritise energy equity and fairer income distribution initiatives to achieve sustainable development goals. |
| Keywords: | Africa; Energy equity; Environmental quality; Income inequality |
| JEL: | D31 O13 O55 Q4 Q5 Q53 |
| Date: | 2024–07–22 |
| URL: | https://d.repec.org/n?u=RePEc:pra:mprapa:121495 |
| By: | Mathias Mier |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ces:econpb:_58 |
| By: | CICCOLINI Giuseppe (European Commission - JRC); JOOSSENS Elisabeth (European Commission - JRC); LE BLANC Julia (European Commission - JRC); MENYHERT Balint (European Commission - JRC); PASQUALINO Roberto (European Commission - JRC); SANYE MENGUAL Esther (European Commission - JRC); WIERZGALA Piotr; ZEC Slavica (European Commission - JRC) |
| Abstract: | Detailed information on the consumption footprint of households is essential for the distributional assessment of their carbon and other environmental impacts. The analysis and monitoring of footprint inequalities helps policymakers to formulate incentives for promoting sustainable lifestyles and consumption patterns, to strengthen consumer awareness and, in turn, to support the steering of our society towards greater environmental and economic sustainability. This report introduces a methodology for a novel dataset of the distribution of the consumption footprint of households as well as its inequality, allowing users to zoom in on geographical areas and socio-demographic characteristics. This dataset is based on granular micro-data on the footprint of the individual products consumed by each individual household. Its construction relies on the product-level matching of survey data on households’ consumption expenditure with information on the related carbon and other environmental footprints. For the latter, we rely on the JRC Consumption Footprint which quantifies the environmental impacts resulting from the consumption patterns of individuals at both the EU and single country scale, accounting for both the impacts within the EU territory as well as the embedded impacts in international trade. This dataset uses the product-level environmental impact information from representative products in the areas of food, mobility, housing, household goods and appliances, which is based on process-based life cycle assessment (LCA) and has a high granularity level to allow for modelling policy scenarios. This report provides a description of the methodology for the development and of the potential use of the novel footprint inequality dataset. Starting from the data description, we outline the steps for matching different input datasets and the challenges involved in developing the data infrastructure. The compiled dataset has a good coverage of the consumption footprint at EU and Member State level and reveals large differences in the level and inequality of the consumption footprint across and within different countries in the EU. |
| Date: | 2024–06 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc137520 |
| By: | Chiara Castelli (Wiener Institut für Internationale Wirtschaftsvergleiche); Marta Castellini (Department of Economics and Management "Marco Fanno", University of Padua and Fondazione Eni Enrico Mattei); Camilla Gusperti (Department of Economics and Management, Università degli Studi di Brescia and Fondazione Eni Enrico Mattei); Veronica Lupi (Department of Environmental Economics, Institute for Environmental Studies, Vrije Universiteit and Fondazione Eni Enrico Mattei); Sergio Vergalli (Department of Economics and Management, Università degli Studi di Brescia and Fondazione Eni Enrico Mattei) |
| Abstract: | The goal of this work is to improve the spatial representation of the Regional Dynamic Integrated model of Climate and the Economy (RICE), in its ’99 version, focusing on the Mediterranean countries, while also updating the calibration to the base year 2015. We evaluate the impact of climate damages and temperature changes in several scenarios, drawing comparisons across regions. Thanks to the theoretical structure of the model, which considers energy as an explicit input factor, we examine macroeconomic and energy indicators across regions. We find that a general slow down in economic growth is needed to decrease emissions and keep temperature change within 2°C by the end of this century. Our results are embedded in a framework showing the costs of delaying the energy transition. Our figures relies on fossil-fuel inputs and exogenous energy saving improvements. |
| Keywords: | IAMs, climate change, social cost of carbon, emissions, temperature, energy, Mediterranean region, Mediterranean countries |
| JEL: | Q54 H23 R13 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2024.20 |
| By: | EORY Vera; BEGHO T.; MACLEOD Michael; MARTINEZ Mari Angeles; CASTELLANOS Vicente; GOMEZ BARBERO Manuel (European Commission - JRC) |
| Abstract: | Livestock production is responsible for most of the greenhouse gas (GHG) emissions from European agriculture. To achieve the climate targets in the European Union, reducing emissions from the food chain, and within that from livestock production, is imperative. Along with structural changes, management and technological improvements on farms have an important role in reducing GHG emissions. However, our understanding of the uptake of low-GHG practices is limited, with uneven evidence across countries and practices. This report adds to the evidence base on the uptake of mitigation practices by presenting the results of two surveys, one done with dairy farmers in Poland about the use of breeding indices, and the other with pig producers in France about multi-phase feeding. The results provide evidence of the importance of farm size and specialisation in practice uptake, while also pointing to the role of the processors in the case of milk production. The most common barriers are high cost, low return on investment and a perception that the farm is too small to implement such practices. Adopters mentioned the benefits of improved milk yield and genetics and also better knowledge of the herd in the case of the breeding index, and reduced feed costs and nitrogen excretion with multi-phase feeding. Simulations of greenhouse gas emissions associated with the adopters’ and non-adopters’ farming systems showed a potential reduction of GHG emission intensity in both cases, namely 9% for milk production with using the breeding index in the herd and 3% for pig meat production with multi-phase feeding. |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc130981 |
| By: | Bakhtavoryan, Rafael; Hovhannisyan, Vardges |
| Keywords: | Demand And Price Analysis, Consumer/ Household Economics, Environmental Economics And Policy |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:343883 |
| By: | Bondonio, D.;; Chirico, P.;; Piacenza, M.;; Robbiano, S.; |
| Abstract: | In March 2023, the EU approved a zero-emission mobility resolution, which mandates zero CO2 emissions for all new vehicles by 2035. This measure has sparked a heated debate due to its uncertain effectiveness in reducing pollution and CO2 emissions globally. Nevertheless, the shift towards zero -emission vehicles has the potential to decrease local nitrogen dioxide (NO2) pollution, particularly in urban areas where air quality is a major concern for citizens’ health. This study investigates what may be the predicted impact of the EU zero-emission mobility policy on local NO2 levels, using the draconian stay-home provision of the Italian Covid-19 lockdown of early 2020 as a natural experiment which generated an exogenous fossil-fuel-traffic abatement that proxies the implementation of the resolution. We exploit datafrom the urban areas with elevated traffic density in the Po-river valley in Northern Italy, a region with the highest peaks of air-pollution in Europe, and we develop a novel intertemporal statistical matching approach which is uniquely suited for policy evaluations on air-quality outcomes in the context of multivariate time series data. The results from our causalinference analysis show that Covid -19 lockdown led to a mean NO2 reduction of 13.62 μg/m3 (around 53% from a baseline average level of 25.8 μg/m3). According to medical literature, this decline in NO2 translates into a reduction in the relative risk of total, cardiovascular, and respiratory mortality of about 9%, 8%, and 4%, respectively. Moreover, we find a marked heterogeneity in the estimated impact of lockdown on pollution and health, with greater decreases in NO2 and in the relative risk of mortality observed for higher baseline pollution levels. These findings suggest that the EU 2035 resolution is indeed expected to improve local air quality and citizens’ health in urban areas with high traffic density. The estimated benefits, however, are likely to vary across EU regions based on prevailing local meteorological conditions and urban texture features, which determine a different baseline pollution, supporting the rationale for a spatial differentiation of the EU zero-emission mobility policy. |
| Keywords: | air pollution;EU zero-emission mobility policy; urban areas; NO2 abatement; health effects; intertemporal statistical matching; impact heterogeneity; |
| JEL: | C10 H23 I18 Q53 R41 R48 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:yor:hectdg:24/07 |
| By: | Feng, Wenxiu; Ruiz Mora, Carlos; Nogales Martín, Francisco Javier |
| Abstract: | We examine a Renewable Energy Source (RES) generator engaged in short-term electricity market trading. Traditionally, variable RES generation has been exempted from balancing responsibilities; however, this exemption is no longer applied in many markets due to their increasing contribution to the energy mix. We consider a RES generator participating in both a day-ahead market and a balancing market. We seek the RES generator’s optimal day-ahead offerings in terms of hourly energy volumes, considering the impact of the subsequent balancing market settlements. To this end, we implement and analyze the accuracy of state-of-the-art Machine Learning (ML) models in forecasting imbalance signs and market prices, assessing the potential to enhance RES’s profitability. Additionally, we evaluate the impact of deploying storage technologies to mitigate the intermittency associated with RES available capacity. We develop a two-stage stochastic optimization model. The first-stage involves day-ahead decisions that anticipate scenario-dependent balancing settlements and real-time battery operation in the second stage. The model uses improved forecasting scenarios generated by an ensemble of ML models, considering contextual and past historical market outcomes. We conduct an extensive set of out-of-sample simulations using real data from the Spanish market, and under the two main financial settlement mechanisms available for balancing markets: single and dual pricing, each with distinct implications for the RES generator. Numerical results indicate that the optimal day-ahead offering strategy, assisted by the proposed ML techniques, leads to increasing and stable profits for the RES generator. When working with a single predictive scenario, prevalent strategic behaviors such as “zero or max” and “null individual imbalance” are observed to facilitate arbitrage or to hedge possible imbalance penalties under single and dual pricing mechanisms. However, in the multiscenario extension, the RES generator trades optimal day-ahead commitments for higher profits or penalty compromises by combining scenario-dependent information for system signs and market prices. Under the single pricing mechanism, storage devices are employed in the balancing market for arbitrating and as an energy backup, while for the dual pricing mechanism, they influence the coordinated day-ahead and balancing trading strategies. |
| Keywords: | Coordinated offering; Electricity markets; Forecast-informed optimization; Stochastic optimization; Storage systems |
| Date: | 2024–07–24 |
| URL: | https://d.repec.org/n?u=RePEc:cte:wsrepe:44216 |
| By: | Masselus, Lise; Ankel-Peters, Jörg; Gonzalez Sutil, Gabriel; Modi, Vijay; Mugyenyi, Joel; Munyehirwe, Anicet; Williams, Nathan; Sievert, Maximiliane |
| Abstract: | Extending the power grid into hitherto unconnected areas is high on the policy agenda in Sub-Saharan Africa. Yet, connection rates and electricity consumption remain low in grid connected areas, at least in the short and medium run. This paper provides a long-term follow-up on an evaluation of a large-scale grid extension program in rural Rwanda. We study the adoption of grid electricity over time using a panel of 41 communities that were electrified up to ten years ago. We find that connection rates for households living near the grid increased from 62% in 2013 to 82% in 2022. At the wider community level, connection rates are much lower, at 51%. Furthermore, electricity consumption and appliance usage are low and did not grow over time. We corroborate these findings with administrative consumption data from the utility customer data base. Our findings suggest that investments into gridbased rural electrification cannot be justified by economic development impacts and cost-benefit considerations. |
| Abstract: | Die Ausweitung des Stromnetzes auf bisher nicht angeschlossene Gebiete steht ganz oben auf der politischen Agenda in Afrika südlich der Sahara. Dennoch sind die Anschlussraten und der Stromverbrauch in netzgebundenen Gebieten zumindest kurz- und mittelfristig niedrig. Dieses Papier bietet eine langfristige Nachbereitung einer Evaluierung eines groß angelegten Netzausbauprogramms im ländlichen Ruanda. Wir untersuchen die Akzeptanz von Netzstrom im Laufe der Zeit anhand eines Panels von 41 Gemeinden, die vor bis zu zehn Jahren elektrifiziert wurden. Wir stellen fest, dass die Anschlussquote für Haushalte, die in der Nähe des Netzes leben, von 62 % im Jahr 2013 auf 82 % im Jahr 2022 gestiegen ist. Auf der Ebene der gesamten Gemeinde liegen die Anschlussquoten mit 51 % deutlich niedriger. Darüber hinaus sind der Stromverbrauch und die Gerätenutzung gering und haben im Laufe der Zeit nicht zugenommen. Wir untermauern diese Ergebnisse mit administrativen Verbrauchsdaten aus der Kundendatenbank des Versorgungsunternehmens. Unsere Ergebnisse deuten darauf hin, dass Investitionen in die netzgestützte ländliche Elektrifizierung nicht durch wirtschaftliche Entwicklungseffekte und Kosten-Nutzen-Erwägungen gerechtfertigt werden können. |
| Keywords: | Energy access, energy consumption, energy use, electricity, Sub-Saharan Africa |
| JEL: | H54 L94 O12 O13 O18 Q41 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:rwirep:300563 |
| By: | Dan Xie |
| Abstract: | Real manufacturing output increased rapidly in China from 1998 to 2012 while sulfur dioxide (SO2) pollution emissions grew at a much lower rate. To study the reasons for this, I focus on the contributions of environmental policy, trade liberalization, and other factors linked to China’s development process. Using China’s entry into the World Trade Organization and the 11th Five-Year Plan as policy shocks, the difference-in-differences analyses show that these policies effectively reduced firm-level pollution intensity. The change in pollution is primarily driven by within-sector firm heterogeneities rather than industry structural change toward less polluting sectors. Finally, the counterfactual analysis based on a quantitative model reveals that environmental regulations play a major role in reducing pollution and the implicit pollution tax faced by firms grew substantially over the period. In addition, tariff cuts due to trade liberalization reduce variable costs of trade and allow firms to abate pollution more. |
| Keywords: | international trade, China, Environmental regulation, Pollution emission |
| JEL: | L60 Q56 F68 F18 Q58 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:wsr:wpaper:y:2024:m:07:i:198 |
| By: | Stewart, Shamar L.; Isengildina Massa, Olga |
| Keywords: | Risk And Uncertainty, Demand And Price Analysis |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:343936 |
| By: | Laura Wangen (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes); Cédric Clastres (GAEL - Laboratoire d'Economie Appliquée de Grenoble - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes) |
| Abstract: | The crucial issue on how to model an optimal economic trading model for Energy Communities (ECs) reveals the need for adapted trading mechanisms and pricing strategies in emerging decentralised market forms. Yet, the extent to which these trading models influence the allocation of costs and benefits to EC members remains unexplored. This poster provides an overview of existing literature findings, lays down relevant models and derives essential principles for economic trades inside ECs. For this purpose, a comprehensive review of relevant literature across economic and engineering domains was conducted, with a specific focus on ECs and Peer-to-Peer (P2P) markets. By examining these concepts, important obstacles and enablers of local energy trading are discussed and related to the framework of ECs. Among the assessed models, the community-based P2P model emerges as highly adaptable for ECs, primarily due to its potential to foster cooperation among prosumers. Furthermore, this research delves into vital insights concerning sharing mechanisms and their integration within trading models. Finally, essential conditions and key considerations are proposed to determine the optimal energy trading structure for ECs, including the need to find a balance between efficiency, fairness and scalability in the design of allocation methods. |
| Keywords: | Energy Communities, Local energy trading, Peer-to-Peer Energy Trading, Optimisation models |
| Date: | 2024–06–25 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-04632076 |
| By: | Anna Viktoria Rohrer (University of Graz, Austria); Santiago J. Rubio (University of Valencia, Spain) |
| Abstract: | This paper investigates the impact of the timing of adaptation on the stability of international environmental agreements (IEAs) for different levels of cooperation. This issue is addressed by solving a three-stage coalition formation game in a Nash-Cournot setting. In the first stage, countries decide non-cooperatively on their participation in an IEA. Then depending on the timing, countries decide on adaptation and emissions in the second and third stage. The game is solved for three levels of cooperation. Countries can either cooperate on emissions (emission agreement), on adaptation (adaptation agreement), or both actions (complete agreement). When emissions are chosen first, this extension to an emission-adaptation game is a generalization of the pure emission game. However, when adaptation is chosen first, the grand coalition is stable, provided that countries sign a complete agreement. With partial cooperation, stable coalitions are small. The results establish a connection between the strategic role of adaptation, the levels of adaptation of non-signatories and signatories for the different types of agreements and the participation in an IEA. Moreover, the results indicate that the grand coalition is stable even when it significantly enhances net benefits. |
| Keywords: | International Environmental Agreements, Emission-Adaptation Game, Prior Commitment, Strategic Effects, Participation, Effectiveness of Adaptation. |
| JEL: | D62 F53 H41 Q54 |
| Date: | 2023–03 |
| URL: | https://d.repec.org/n?u=RePEc:grz:wpaper:2023-03 |
| By: | Mats Kröger |
| Abstract: | Public support systems and private investments in renewable energy are increasingly existing side-by-side and are both emphasized in policy proposals on the European and national levels. This paper assesses the interaction between the two approaches with respect to cream-skimming, i.e., the potential for low-cost projects to sign private contracts that increase the costs of publicly supported renewable energy. This paper uses a stylized microeconomic model and a numerical simulation to assess this question. It finds that the incentive to cream-skimming exists when governments employ any form of resource differentiation in their renewable energy contracts. The numerical analysis shows that, at current price levels, cream-skimming could increase power prices by 2-6% depending on the PPA’s mark-up. The effect is larger for a wider cost-distribution of renewable energy projects, which might occur as the energy transition proceeds. |
| Keywords: | Climate policy, renewable energy, distributional consequences, creamskimming, contracts for differences |
| JEL: | D44 Q42 Q48 |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2092 |
| By: | Pablo Garcia Sanchez |
| Abstract: | To finance the fight against climate change, sustainable investment is projected to surpass $40 trillion by 2030. In principle, sustainable investment diverts funds away from brown firms, increasing their borrowing costs to encourage them to become greener. However, recent empirical evidence does not support this channel, as the most polluting firms tend to become more brown in response to higher costs of capital. I formalise this empirical finding by developing a stylised model where brown firms must choose the optimal time to switch from old, polluting technologies to new, clean alternatives. Results indicate that raising the cost of capital for brown firms can have non-monotonic effects on the optimal switching times. For example, firms operating in capital-intensive sectors, often among the largest polluters, are more likely to respond to higher borrowing costs by delaying their switching time. In contrast, brown firms that are nearly ready to switch to cleaner methods may speed up their transition when faced with higher borrowing costs. |
| Keywords: | Sustainable Investment, Cost of Capital, Green Transition |
| JEL: | Q50 Q56 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:bcl:bclwop:bclwp187 |
| By: | Lee, Jaeyoon (Korea Institute for Industrial Economics and Trade); Tak, Eun-myeong (Korea Institute for Industrial Economics and Trade); Kim, Jeong-Hyun (Korea Institute for Industrial Economics and Trade) |
| Abstract: | Climate-conscious trade norms are rapidly taking root worldwide, transforming the trade environment andfueling uncertainty in the steel industry. This new trade paradigm presents a significant challenge to the Koreansteel industry, the country’s largest emitter of greenhouse gases (GHGs). With the European Union (EU)having finally adopted a Carbon Border Adjustment Mechanism (CBAM) after years of rumor and speculation, Korean steelmakers — and particularly those with businesses exporting carbon-intensive steel — mustbrace for the impact of the CBAM and other carbon regulations. While the introduction of the CBAM poses threatens steelmakers who rely heavily on exports to the EU(particularly of steel plates), the CBAM also creates new opportunities for market participants. In this paper, we analyze the potential impacts of the CBAM on Korean steel exports and imports. Assuming the currentexport basket and carbon intensity levels remain unchanged, initially the CBAM is likely to erode the marketshare of Korean steel in Europe. But it could also create space for Korean producers to capture demanddisplaced from competitors even less prepared for the new regulatory regime. This effect is likely to intensifyafter 2030 as the CBAM’s carbon reduction measures tighten. The evolving landscape in the Europeanmarket may also see increased competition from steel producers in China as well, with implications forKorea’s own domestic market. The path forward for the Korean steel industry lies in embracing green steelmaking. This necessitates swiftand decisive action from Korean decisionmakers, who ought to immediately begin implementing a roadmapfor achieving net zero in steelmaking, enhancing the competitiveness of Korean steel and navigating theincreasingly uncertain trade environment. Broad-based support from both the government and society isnecessary to ensure that Korean steelmakers are equipped to effectively compete with their internationalrivals backed aggressive state investments in green technologies. |
| Keywords: | Korea; EU; Carbon Border Adjustment Mechanism; CBAM; steel; steel industry; steelmaking; green steel; hydrogen reduction; manufacturing; emissions; greenhouse gases; GHGs; KIET |
| JEL: | F13 F51 F53 L61 Q52 Q55 Q56 Q58 |
| Date: | 2024–03–29 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kietrp:2024_004 |
| By: | Le, Hoanh; Gálvez-Soriano, Oscar |
| Keywords: | Land Economics/Use, Resource/Energy Economics And Policy, Environmental Economics And Policy |
| Date: | 2024 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea22:343763 |