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on Energy Economics |
| By: | Vesterberg, Mattias (Department of Economics, Umeå University) |
| Abstract: | This study estimates the causal impact of the recent years’ high electricity prices on electric vehicle (EV) adoption. Utilizing Swedish registry data and leveraging regional discontinuities in electricity prices, I demonstrate that higher electricity prices reduce EV demand, but also the demand for combustion-engine vehicles. Additionally, the response to electricity prices varies across different types of EVs and socio-economic groups. Based on these findings, I explore a counterfactual policy that reduces electricity prices for EV buyers, and show that under plausible assumptions, this policy is less cost-effective in boosting EV demand compared to subsidies for EV purchases or charging infrastructure. |
| Keywords: | Electrification; Transportation; Regression discontinuity |
| JEL: | D12 Q41 R41 |
| Date: | 2025–03–07 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:umnees:1032 |
| By: | Raimi, Daniel (Resources for the Future); Greenspon, Jacob |
| Abstract: | The imperative to reduce greenhouse gas emissions necessitates major changes in the domestic and global energy sector. However, one concern is whether workers currently employed in the coal, oil, and natural gas industries will be able to access alternative employment opportunities with comparable levels of pay, inside or outside of the low-emissions energy sector. A related question is whether current educational programs are sufficient to train the large workforce that will be needed to rapidly deploy the range of technologies required to achieve deep reductions in greenhouse gas emissions. This analysis provides early evidence on these questions by analyzing data on occupational skills across the US economy. We find that a substantial number of occupations offer a good “skills match” for today’s fossil fuel workforce, but most of those occupations pay considerably less than jobs in fossil fuel extraction, refining, transportation, and power generation. Occupations that frequently offer a good-match with comparable pay are found mainly in transportation, construction, and rail industries. Several low-emissions sectors, particularly critical minerals mining, hydrogen, carbon capture, and energy-related civil engineering and construction, offer a substantial number of jobs with similar levels of pay and a good skills match for fossil fuel workers. We find that educational programs training workers to work with low-emissions technologies are fairly modest in scope, with the largest number in construction and heat pump installation and maintenance. We also find that in most cases, there is a positive correlation between where low-carbon technologies are being deployed and where workers are being trained to build and operate those technologies. |
| Date: | 2025–03–03 |
| URL: | https://d.repec.org/n?u=RePEc:rff:dpaper:dp-25-06 |
| By: | Burtraw, Dallas (Resources for the Future); Palmer, Karen (Resources for the Future); Roy, Nicholas (Resources for the Future) |
| Abstract: | This paper examines three frameworks to achieve 100 percent clean energy for electricity consumption in Maryland with full compliance by 2040. Increasing the stringency of the existing Renewable Portfolio Standard (RPS) is insufficient to achieve this goal. A higher alternative compliance payment is essential for boosting policy-driven clean energy development.A Clean Energy Standard (CES), similar to the RPS, but credits all nonemitting generation and includes an increasing alternative compliance payment, achieves greater investment in clean energy. This standard might be met with imported clean energy or imported clean energy credits, both of which enable continued fossil generation in Maryland, potentially for export.The third framework, an Emissions Intensity Standard (EIS), would cover Maryland’s generated and imported power, focusing on the emissions intensity of consumption. This approach provides incentives for a greater set of compliance opportunities, including substitution away from coal in imported power, and improving the cost effectiveness of emissions reductions. The EIS yields lower electricity prices, negligibly above business as usual through 2035, and modestly higher thereafter.We identify several essential elements of policy design. Compliance could be achieved by placing an obligation upon retail suppliers to achieve clean energy goals. Enforcement would require a resource planning process. Suppliers might demonstrate compliance through power purchase agreements and potentially through joint compliance planning. A regulatory process involving oversight by the Public Service Commission could aim to balance the imperatives to maintain affordability and electricity resource adequacy with clean energy goals. The regulatory process might involve planning, procurement obligations (e.g., power purchase agreements), and ongoing compliance evaluation.Increasing demand for clean energy by large private loads such as data centers could lead to future increases in the price of clean energy, hence early commitments to contracts for clean energy could help limit exposure to such price increases.These policy designs retain Pennsylvania-New Jersey-Maryland’s (PJM’s) role of assuring resource adequacy in the broader region including Maryland, while accelerating the transition toward clean energy consumption within the state. The reliability of electricity supply in Maryland is not necessarily tied to locating generation in Maryland, however, locating a greater amount of generation in the state may provide greater local resilience and give Maryland more options in future energy planning. |
| Date: | 2025–03–14 |
| URL: | https://d.repec.org/n?u=RePEc:rff:dpaper:dp-25-09 |
| By: | Marta Castellini (Department of Economics and Management "Marco Fanno", University of Padova, and Fondazione Eni Enrico Mattei); Chiara D'Alpaos (Department of Civil, Environmental and Architectural Engineering, University of Padova); Fulvio Fontini (Department of Law Studies, University of Salento and Climate Economics Chair, University Paris Dauphine); Michele Moretto (Department of Economics and Management "Marco Fanno", University of Padova) |
| Abstract: | Renewable energy production plays a crucial role in the energy transition. However, many renewable energy sources (RES) are intermittent, and there is often a mismatch between energy production and consumption, which can be partially solved by storage. In this paper, we investigate the investment decision in a photovoltaic (PV) power plant coupled with a Battery Energy Storage System (BESS), namely an Energy Storage System (ESS). We aim to investigate the relationship between the net present value (NPV) of the investment and the technical implications related to the maximum amount of energy to be stored while also accounting for the impact of energy prices. In our setting, the BESS is connected to the national power grid and the PV plant. Energy can be produced, purchased from the grid, stored, self-consumed, and fed into the grid. PV production and energy consumption loads evolve stochastically over time. In addition, as BESS are costly, energy stored has an opportunity cost, which depends on the prices of energy purchased from the grid and energy fed in and sold to the grid, respectively. However, BESS can significantly contribute to increase ESS managerial flexibility and, in turn, ESS value. In detail, we investigate the optimal BESS size that minimizes ESS net operating costs. We also provide insights on ESS optimal management strategy. Our results show that ESS net operating costs are relatively small. They reduce for increasing selling prices of energy, whereas they increase for increasing volatility of the stock of energy stored in the battery. |
| Keywords: | Renewable Energy Sources, Photo-voltaic, Battery Storage |
| JEL: | Q42 C61 D81 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2025.06 |
| By: | Prest, Brian C. (Resources for the Future) |
| Abstract: | Surging exports of US liquefied natural gas (LNG) over the past decade have raised concerns about their potential to increase domestic gas prices and spur environmental impacts, both local and global, especially because methane, a potent greenhouse gas, commonly leaks from US oil and gas infrastructure. Yet methane leak rates vary widely—up to an order of magnitude—across sources of US oil and gas supply, creating uncertainty in the carbon footprint of US LNG. This paper models the impacts of increased US oil and gas export demand on domestic oil and gas prices, marginal oil and gas supply by US basin, and the implied methane intensity of that marginal supply. Each 1 billion cubic feet per day (Bcf/d) increase in gas export demand is estimated to increase domestic natural gas prices by approximately 2.5% while reducing crude oil prices by 0.5% due to the induced supply of coproduced oil. The US supply response to gas export demand comes disproportionately from basins with low estimated methane leak rates, led by Appalachia, yielding an effective methane intensity of the gas supply anticipated to meet export demand (1.7% leak rate) that is lower than the average US gas supply (3.1%). The supply response to an increase in oil demand shows the reverse pattern, with high-leak Permian supply crowding out low-leak basins like Appalachia, yielding a very high effective methane leak rate (9.1%). These widely varying effective methane leak rates suggest that the 2015 repeal of the US crude oil export ban may have been a bigger driver of US methane emissions than expanded LNG exports would be. In particular, model results suggest that US crude oil exports over 2015–23 drove methane emissions twice as large as those driven by US LNG exports over the same period, with the former’s induced emissions equivalent to those expected to be caused by more than 20 Bcf/d of gas exports. |
| Date: | 2025–03–10 |
| URL: | https://d.repec.org/n?u=RePEc:rff:dpaper:dp-25-05 |
| By: | Markoulakis, Andreas (University of Warwick); Nduka, Eleanya (University of Warwick) |
| Abstract: | Using UK household data, we examine empirically how different facets of energy security, energy vulnerability, affordability, reliability and imports dependency impact the support for three different energy sources: renewables, nuclear and shale gas extraction. Our approach utilises an ordered logistic econometric model and controls for various socio-demographic variables. We find that each facet can have a differential impact in the probability of support for each energy source and in general, as energy security concerns decline, households are becoming less likely to support each energy source, however, the effects are larger for nuclear and shale gas compared to renewables. Our findings are robust to potential endogeneity concerns which are addressed by using instrumental variables. The above results can be useful for policy appraisal purposes to inform policy makers on the differential impact of energy security facets when designing future energy policies towards the net zero targets. |
| Keywords: | Energy security ; renewable energy ; nuclear energy ; shale gas ; climate change concern. JEL Codes: D12 ; Q20 ; Q40 ; Q42 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:wrk:warwec:1556 |
| By: | Kay, Owen; Hausman, Catherine; Ham, Dasom |
| Abstract: | The US electrical grid is experiencing a rapid transition as cheap renewable electricity transforms the energy mix. With these grid changes, new supply is not spatially matched to demand, and the transmission network has become more strained. Better market integration could thus lower US generation costs. This report estimates the excess generation costs associated with transmission congestion and other spatial constraints across the lower 48 states, as an extension of a 2024 report on the MISO/SPP regions. We document that eliminating interregional constraints would have reduced generation costs by $5.8–7.1 billion in 2022 and $3.4–5.0 billion in 2023. Despite these overall potential cost savings, we show that market integration creates winners and losers among generation companies—of interest because generators have a large say in whether transmission projects are developed. We show clear spatial patterns in generation company outcomes, documenting that producers in some regions have incentives to delay or block grid integration despite the overall system benefits.Keywords: Electricity markets, transmission constraints, renewable energy, market integration, political economy of energy markets, energy transitionJEL Codes: L94, P18, Q41, Q42, Q48 |
| Date: | 2025–04–04 |
| URL: | https://d.repec.org/n?u=RePEc:rff:dpaper:dp-25-10 |
| By: | Julian Puig (CEFIT-IIE-FCE-UNLP); Leonardo Gasparini (CEDLAS-IIE-FCE-UNLP & ANCE & CONICET); Jorge Puig (CEDLAS-IIE-FCE-UNLP & CEFIT-IIE-FCE-UNLP) |
| Abstract: | This paper examines the relationship between energy subsidies and energy poverty (EP). Understanding this relationship is important because subsidies are often justified from an equity perspective to protect the most vulnerable households. Argentina, which has subsidized residential energy consumption since the early 2000s, is used as the case study. Since then, the energy subsidy policy has experienced two well-defined phases: massive and universal subsidies until 2015, followed by an attempt at reduction and targeting. This context, combined with notable regional disparities -including variations in income levels, climatic conditions, energy prices, and residential energy consumption patterns (e.g., electricity vs. piped gas)- makes this case study particularly compelling. EP is analyzed both unidimensionally and multidimensionally. Under both measures, EP follows a U-shaped pattern that reflects the phases of energy subsidies: a significant decrease between 2005 and 2013, followed by a considerable increase by 2018. The paper also highlights the key role of regional disparities which is crucial for interpreting the results beyond the Argentine case. Based on the findings, the paper contributes with globally relevant insights on the link between energy subsidy policies and EP. |
| JEL: | I32 Q40 D30 H24 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:dls:wpaper:0348 |
| By: | Pu Chen (MIT, USA; University of Melbourne, Australia); Willi Semmler (Department of Economics, New School For Social Research, USA) |
| Abstract: | Much Keynesian-oriented research on energy policies has studied the effects of quantity shocks on sector expansions and contraction. The New Keynesian literature has considered the energy transition and their effects on relative prices due to fossil fuel and renewable energy shocks resulting from carbon tax and subsidies. We consider sectoral dynamic interactions of quantities and prices in markets after shocks. The issue here is then to what extent do prices and quantities change when there are quantity shocks. On the other hand, how sizable are the price and quantity effects when there are price shocks. New Keynesian literature refers to the monopolistic competition theory and the Lerner measure, capturing demand elasticity, and is relying on expected future marginal costs and markups studying equilibrium relative price change. Instead of using this proposition, or partially assuming or estimating elasticities, we undertake here model guided econometric VAR and CIVAR estimations, to understand the size of the interaction effects of quantity and price shocks in markets not necessarily in equilibrium, but when market variables have moved below or above some trends. As to the energy transition we show that in higher carbon intensity sectors the prices and quantities move differently as compared to less carbon intensive sectors. As we demonstrate the relative quantity and price changes show sectoral dependency – the price and quantity shock responses are dependent on the carbon intensity of the sectors. |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:new:wpaper:2504 |
| By: | Mitchell Berlin; SungJe Byun; Pablo D'Erasmo; Edison Yu |
| Abstract: | We develop a measure of climate transition risk for regional economies in the U.S., based on the mix of firms that produce emissions in each region. To quantify transition risks, we consider the introduction of an emissions tax levied on companies emitting greenhouse gases and estimate changes in the market values of industries due to a carbon tax using Merton’s (1974) model. We find that transition risks are highly concentrated in a few sectors and counties with heavy exposures to transition-sensitive sectors. The size and geographic concentration of the tax effects depend significantly on assumptions about the elasticity of demand for inputs in the production chain. When applying county-level estimates for transition risks to banks’ deposit footprint, we find mild to moderate transition risks for community banks as a whole, although transition risks are high for a few banks. |
| Keywords: | Greenhouse Gas Emissions; Transition Risk; Carbon Taxes; Regional Transition Risks; Bank Exposure |
| JEL: | R11 R15 Q21 Q51 Q54 C53 |
| Date: | 2025–03–21 |
| URL: | https://d.repec.org/n?u=RePEc:fip:fedpwp:99714 |
| By: | World Bank |
| Date: | 2023–09 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40325 |
| By: | Andrea Bastianin (Department of Economics, Management and Quantitative Methods, University of Milan and Fondazione Eni Enrico Mattei); Chiara F. Del Bo (Department of Economics, Management and Quantitative Methods, University of Milan); Luqman Shamsudin (Fondazione Eni Enrico Mattei and Department of Environmental Science and Policy, University of Milan) |
| Abstract: | We map the mining sector in Europe, with a focus on Energy Transition Metals (ETMs), and present an in-depth analysis of the environmental impact and associated monetary costs, at the regional level, of extraction activities. We aim to offer a spatially disaggregated view of the current mining projects and associated environmental costs in terms of CO2 emissions and their monetary value. To do this, we collected global warming potential (GWP) data from Life Cycle Assessment Impact Analysis (LCIA) and linked these to their expected monetary value. By considering the full spectrum of sourced ETMs, we map the environmental, physical, and monetary impact of current mining activities in Europe, and understand what a further increase in exploiting European reserves to reduce dependence from abroad and facilitate the green transition, could imply for European regions. |
| Keywords: | Critical raw materials, Europe, Life Cycle Assessment Impact Analysis, mining, regional |
| JEL: | L72 O52 Q32 Q51 R11 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2025.08 |
| By: | Yanxia Yu; Chenfei Qu; Tom Coupé (University of Canterbury); Mathilda Featherston-Lardeux; Andreas Loeschel; Arne R. Weiss; Da Zhang |
| Abstract: | How effective are Emission Trading Schemes (ETS) in reducing carbon emissions? This paper addresses this question using a meta-analysis of 80 primary studies and 732 effect size estimates assessing the impact of China’s pilot ETS, introduced in seven provinces and cities in 2011. Our findings suggest that China’s pilot ETS led to small to medium-sized reductions in CO2 emissions, with estimated reductions ranging from 5.5% to 16.6% compared to a no-ETS counterfactual. Meta-regression and Bayesian Model Averaging analyses further show that the estimated impacts of the ETS vary with the empirical methods employed and the control variables used. The range of estimates we obtain from synthesizing the literature provides policy-makers with an evidence-based expectation of the potential scale of emissions reductions in the initial phase of developing an ETS. |
| Keywords: | Meta-analysis, Emission trading scheme |
| JEL: | C18 Q58 |
| Date: | 2025–03–01 |
| URL: | https://d.repec.org/n?u=RePEc:cbt:econwp:25/04 |
| By: | Döttling, Robin; Rola-Janicka, Magdalena |
| Abstract: | We analyze optimal carbon pricing under financial constraints and endogenous climate-related transition and physical costs. The socially optimal emissions tax may be above or below a Pigouvian benchmark, depending on the strength of physical climate impacts on pledgeable resources. We derive necessary conditions for emissions taxes alone to implement a constrained-efficient allocation, and show a cap-and-trade system may dominate emissions taxes because it can be designed to have a less adverse effect on financial constraints. We also assess how capital structure, carbon price hedging markets, and socially responsible investors interact with emissions pricing, and evaluate other commonly used policy tools. |
| Date: | 2023–05–22 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:ds7bx_v1 |
| By: | Alexandrina Platonova-Oquab; Apoorva Shenvi |
| Date: | 2023–11 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40635 |
| By: | World Bank |
| Keywords: | Communities and Human Settlements-Urban Communities Environment-Adaptation to Climate Change Environment-Air Quality & Clean Air Environment-Climate Change Mitigation and Green House Gases |
| Date: | 2023–09 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40310 |
| By: | Sophie M. Behr; Till Köveker; Merve Kücük |
| Abstract: | Russia’s invasion of Ukraine in 2022 was accompanied by a significant reduction of its gas supply to Europe, causing sharp energy price surges and prompting governments to respond with public appeals and programs aimed at reducing consumption. This paper investigates the effects of price increases and non-monetary factors, such as public appeals and saving programs, on residential energy savings during the crisis. Using a unique building-level dataset on residential energy consumption and prices in Germany, we identify price-driven savings and energy price elasticities with a DiD-PSM approach. By comparing buildings that faced price increases to buildings with constant prices, we can isolate price-driven savings from contemporaneous non-monetary effects. Our findings reveal that while increased prices led to moderate short-run energy savings, the majority of observed savings were driven by non-monetary factors. Consequently, we identify a relatively low short-run price elasticity of residential heat energy demand of -0.07. Going beyond average effect estimation, we use two machine learning methods to calculate building-level price-driven and non-price-driven savings, then analyzing their variation with socio-economic characteristics using census data. |
| Keywords: | Energy crisis, Energy policy, Causal inference, Double machine learning |
| JEL: | Q41 Q48 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2112 |
| By: | Samantha M. Treacy; Alexandra B. Moura |
| Abstract: | As reliance on solar photovoltaic (PV) generation grows, particularly in Alberta, accounting for the impact of wildfire smoke on solar energy production is crucial. This is particularly relevant in regions with high PV generation potential, such as Alberta, as they are often more vulnerable to frequent and intense wildfires. This study quantifies PV energy losses and financial impacts due to wildfire smoke in Alberta, using fine particulate matter 2.5 (PM2.5) as a proxy for smoke pollution. Historical weather and PM2.5 data, along with simulated PV production from actual completed, proposed, and under-construction projects, are used to train and test the model. The simulated data is validated against real production data. The six-year study (2018–2023) covers major wildfire years and employs machine learning techniques, particularly random forest regression, to isolate the effects of PM2.5 on solar production. Financial losses are estimated in Canadian dollars, adjusted for inflation to December 2023. Results show a PV production decline of up to 6.3% at a single solar site over six years, with an overall average reduction of 3.91% under severe conditions. The cumulative impact led to a 0.19% average generation loss, equating to over $4.5 million in financial losses. Higher smoke levels consistently correlate with greater solar energy losses, aligning with findings from other regions. The results of this study enhance our understanding of climate change impacts on solar energy, highlighting wildfire smoke as a relevant factor. As PV adoption expands, these findings offer valuable insights for decision-makers and operational planners, emphasizing the need for strategies to mitigate smoke-related disruptions and ensure energy reliability. |
| Keywords: | Photovoltaic production; Wildfires; PM2.5; Financial impact; Random forest; Solar power. |
| JEL: | C55 N72 P18 Q42 Q54 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:ise:remwps:wp03732025 |
| By: | Bushong, James; Bushong, Henry |
| Abstract: | Recent observations of astrophysical plasma jets emanating from the galactic-core of Galaxy M87 underscore the importance and intensity of magnetic fields in powerful celestial vortices. Based on standard electromagnetic theory, this naturally indicates the presence of potent electric field within these vortices. Any new method of generating powerful electromagnetic field is worthy of consideration for humanities’ power and energy needs. As astrophysical plasma jets are also known to be among the most powerful forms of energy in the observed Universe, it seems well-worthy of consideration as to how humanity may be able to simulate them in a scaled-down version that could serve as an alternative green energy source. This paper explores how these energetic processes might be simulated and scaled to humanities’ needs based on (1) postulates around the physics / energy sources of celestial vortices; (2) potential characteristics of the electric field charge-distribution, convective currents, and spatial orientation within celestial vortices; (3) characteristics of the magnetic field spawned by the proposed electric field; (4) estimates of density and rotational velocity of celestial vortices based on novel stellar-formation vortex theory and computational modeling, and (5) how aspects of stellar formation physics may aid in achieving humanities’ quest for nuclear fusion. |
| Date: | 2023–05–25 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:bymjg_v1 |
| By: | Phoebe Koundouri; Angelos Alamanos; Christopher Deranian; Jorge Andres Garcia; Olympia Nisiforou |
| Abstract: | The Greek maritime sector, one of the largest in the world, faces multiple economic, environmental and development challenges, requiring careful long-term investment decisions. In this paper we present the application of a free, open-source Investment Decision Support tool we have developed, the MaritimeGCH, applied for the Greek fleet. We quantify the effect of two main interventions for a cost-effective carbon abatement, under the recent EU environmental regulations: the implementation of mature on-ship emission reduction technologies and transition scenarios to cleaner fuels. While significant emissions are achievable, even ambitious interventions fall short of fully decarbonizing the sector by 2050. This suggests that a more unified set of policy solutions are needed to achieve the national commitments. |
| Date: | 2025–04–02 |
| URL: | https://d.repec.org/n?u=RePEc:aue:wpaper:2529 |
| By: | Saufillah, Zulfiyatus |
| Abstract: | Energy management is critical to achieving sustainable agriculture development and reducing environmental impacts. The strategies for energy management discussed in this essay, including energy efficiency measures, energy management systems, and green financing, can help drive green entrepreneurship growth in the agriculture sector. Implementing these strategies can help green entrepreneurs reduce energy consumption and costs, improve productivity, promote sustainable development, and create new growth opportunities. Therefore, policymakers, investors, and other stakeholders should work together to support the implementation of these strategies in the agriculture sector. |
| Date: | 2023–05–08 |
| URL: | https://d.repec.org/n?u=RePEc:osf:osfxxx:5qcwr_v1 |
| By: | International Finance Corporation |
| Keywords: | Environment-Climate Change Mitigation and Green House Gases Environment-Adaptation to Climate Change Urban Development-City Development Strategies Finance and Financial Sector Development-Access to Finance |
| Date: | 2023–11 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40561 |
| By: | Hassel, Anke (Hertie School); Gómez, Sofía (Hertie School); Jansen, Jannik (Hertie School); Weil, Kilian (Hertie School) |
| Abstract: | Transitioning towards a greener economy means profound changes in industries and employment. This paper examines the challenges of employment transitions with a focus on the geographical and social implications of structural shifts. |
| Keywords: | Green transition, labour market adjustment, emission-intensive industries, political responses, regional policies |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:bda:wpsmep:wp2025/31 |
| By: | Enrico Cavallotti (Trinity College Dublin, Department of Economics); Italo Colantone (Bocconi University, Department of Social and Political Sciences, GREEN Research Centre, Baffi Research Centre, CESifo & Fondazione Eni Enrico Mattei); Piero Stanig (Bocconi University, Department of Social and Political Sciences, GREEN Research Centre, & Dondena Research Centre); Francesco Vona (University of Milan, Department of Environmental Science and Policy & Fondazione Eni Enrico Mattei) |
| Abstract: | We study how occupation-related material interest affects environmental voting. Specifically, material interest hinges on the greenness vs. brownness of individual occupational profiles. That is, on the extent to which individuals are expected to benefit vs. lose in a greener economy. We employ individual-level data from 14 western European countries, over 2010-2019. To measure the greenness and brownness of occupational profiles, for each individual we compute predicted greenness and brownness scores based on the predicted probabilities to be employed in each possible occupation. These probabilities are combined with occupation-specific greenness and brownness scores. Individuals characterized by higher predicted brownness are less likely to vote for Green parties and for parties with a more environmentalist agenda, while the opposite holds for individuals characterized by higher predicted greenness. Voting preferences of brown profiles tend to converge towards those of greener profiles in regions that are better placed to gain from the green transition. |
| Keywords: | green voting, material interests, green jobs, brown jobs, labour market effects of the green transition |
| JEL: | D72 Q52 P16 |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:fem:femwpa:2025.09 |
| By: | Anjali Singh (Indian Council for Research on International Economic Relations (ICRIER)); Amit Kumar; Kartik Nair; Ritika Verma; Narasimhan Soundarrajan |
| Abstract: | A technology roadmap for EV battery recycling in India is essential to establish a circular economy, reduce environmental hazards and ensure the sustainable use of critical minerals like lithium, cobalt, nickel, and phosphorous. It guides the investment in advanced recycling technologies, promoting efficiency and scalability. This technology roadmap can be a guiding document to strategise and plan the country's infrastructure, promote industry collaboration (EV and battery manufacturers and recyclers), and ensure regulatory compliance to manage the looming EV battery waste. Ultimately, it will strengthen India's self-reliance in raw materials and aligns with global sustainability commitments. |
| Keywords: | Supply Chain, EV Battery, clean energy, icrier, environmental hazards, recycle |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:bdc:report:25-r-08 |
| By: | Vassilios Babalos (Department of Accounting and Finance, University of Peloponnese, Kalamata, Greece); Xolani Sibande (Department of Economics, University of Pretoria, Pretoria, South Africa); Elie Bouri (Adnan Kassar School of Business, Lebanese American University, Lebanon); Rangan Gupta (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa) |
| Abstract: | This study offers new insights into the herding behaviour in US clean energy Exchange-traded funds (ETFs) over the period from May 1, 2016 to June 19, 2024. The baseline model shows significant herding. An extended mode indicates that herding is present in both down and up markets, with a stronger effect in the down market, suggesting an asymmetry. Herding is also found to be time-varying. Further analysis shows that the transition climate risk, particularly its high level, reduces the probability of herding in clean energy ETFs, whereas physical climate risk does not exert any significant impact on the probability of herding. Thus, large levels of transition climate risk seem to encourage market efficiency in clean energy ETFs and climate-hedging behavior by investors. |
| Keywords: | Herding Behaviour, Climate Change, Clean Energy |
| JEL: | G14 Q54 P18 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:pre:wpaper:202512 |
| By: | Matzner, Nils; Otto, Danny; Polzin, Christine; Hauck, Jennifer; Förster, Johannes; Wollnik, Ronja; Siedschlag, Daniela; Thrän, Daniela |
| Abstract: | Wie werden verschiedene Verfahren zur Entnahme von CO2 aus der Atmosphäre von Stakeholdern in unterschiedlichen Regionen Deutschlands wahrgenommen? Dieser Frage sind Workshops des Projektes "BioNET - Multi-stage assessment of biobased negative emission technologies"1 nachgegangen, um Potenziale und Herausforderungen biomassebasierter Carbon Dioxide Removal (bioCDR)-Technologien besser zu verstehen. In vier Stakeholder-Workshops wurden Expert*innen aus Industrie, Landwirtschaft, Forstwirtschaft, NGOs und Politik einbezogen, um bioCDR Maßnahmen, deren regionale Besonderheiten und gesellschaftlich-politisches Vertrauen zu diskutieren. Die Ergebnisse zeigen, dass bioCDR-Technologien wie Aufforstung, Pyrolyse von Biomasse (PyCCS) und Moor-Wiedervernässung als vielversprechend angesehen werden, jedoch auf regulatorische, wirtschaftliche und soziale Hürden stoßen. Während regionale Unterschiede in der Umsetzbarkeit bestehen, gibt es wiederkehrende Herausforderungen wie Flächenkonkurrenz, mangelnde politische Unterstützung und Unsicherheiten in der Finanzierung. Besonders betont wurde die Bedeutung von Kaskadennutzung, um die Effizienz von bioCDR zu maximieren. Das entwickelte Planspiel "Carbon Cascadia" unterstützte die Diskussion über Biomassekaskaden und langfristige CO₂-Speicherung. Die Ergebnisse verdeutlichen die Notwendigkeit gezielter Förderinstrumente und eines abgestimmten Politikrahmens, samt Bürger*innenbeteiligung, um bioCDR langfristig zu etablieren. Ohne klare Strategien und gesellschaftliche Einbeziehung besteht das Risiko, dass Potenziale dieser Technologien ungenutzt bleiben. Der Bericht liefert wertvolle Einblicke für Forschung, Politik und Praxis zur Weiterentwicklung von bioCDR in Deutschland. |
| Keywords: | Biomasse, Klimapolitik, Stakeholder, Carbon Dioxide Removal, Negative Emissionen |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ufzdps:315204 |
| By: | World Bank |
| Keywords: | Environment-Climate Change Mitigation and Green House Gases Energy-Energy Conservation & Efficiency Environment-Environmental Governance |
| Date: | 2023–09 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40408 |
| By: | World Bank |
| Keywords: | Information and Communication Technologies-ICT Applications Governance-E-Government Environment-Adaptation to Climate Change |
| Date: | 2023–11 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40594 |
| By: | Keohane, Robert O |
| Keywords: | Social and Behavioral Sciences |
| Date: | 2025–03–31 |
| URL: | https://d.repec.org/n?u=RePEc:cdl:globco:qt6q2833r3 |
| By: | Alienor Cameron |
| Abstract: | Defining a fair and transparent measure of carbon leakage risk is essential to ensure the effectiveness of the EU's climate policies. This paper proposes a novel methodology to assess this risk, which takes market structure into account -- a key factor often overlooked in both academic research and policymaking. The methodology involves applying the micro-founded hypothetical monopolist test (or SSNIP test) at the country-product level. It allows for the definition of the relevant market for four products in the steel and cement industries. The inputs required for the hypothetical monopolist test are derived by estimating a product-level gravity equation. The findings from this study illustrate that market structure differs substantially at the product level, even within a single industry. Clinker appears as the product most at risk of carbon leakage. This suggests that carbon leakage risks should be computed by policymakers at a highly granular level and taking market structure into account. |
| Keywords: | climate policies, hypothetical monopolist, gravity model, carbon leakage, EU ETS |
| JEL: | H23 L51 O33 Q58 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:drm:wpaper:2025-17 |
| By: | Khamidov, Imomjon; Egamberdiev, Bekhzod |
| Abstract: | Environmental issues adversely impact air quality, biodiversity, and socio-economic conditions in Central Asia. This paper utilizes the Life in Transition dataset to analyse climate change awareness and willingness to mitigate among populations from Kazakhstan, the Kyrgyz Republic, Tajikistan, and Uzbekistan. Our findings reveal that public perceptions of environmental problems vary, with the highest concerns about air pollution, waste, species loss, temperature fluctuations, natural disasters, and disease spread noted in Uzbekistan and the Kyrgyz Republic. Conversely, awareness and concern for environmental issues in Tajikistan are relatively low. |
| Keywords: | environmental problems, climate change, public perception, willingness to contribute, Central Asia |
| JEL: | Q54 Q56 P48 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:esprep:314939 |
| By: | Christian Bayer (University of Bonn, CEPR, CESifo & IZA); Alexander Kriwoluzky (Freie Universität Berlin & DIW Berlin); Gernot J. Müller (University of Tübingen, CEPR & CESifo); Fabian Seyrich (Frankfurt School of Finance & Management & DIW Berlin) |
| Abstract: | The distributional and disruptive effects of energy supply shocks are potentially large. We study the effectiveness of alternative fiscal responses in a two-country HANK model calibrated to the euro area. Subsidies can stabilize the domestic economy, but they are fiscally costly and generate negative spillovers to the rest of the monetary union: What the subsidizing country gains, other countries lose. Transfers based on historical gas consumption in the form of a Slutsky compensation are less effective domestically than subsidies, but do not harm economic activity abroad. Moreover, transfers increase domestic welfare, while subsidies decrease it. |
| Keywords: | Energy Crisis, Subsidies, Transfers, HANK2, Monetary Union, International Spillovers, Heterogeneity, Inequality, Households |
| JEL: | D31 E64 F45 Q41 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:ajk:ajkdps:361 |
| By: | Liza Archanskaia; Plamen Nikolov; Wouter Simons; Lukas Vogel |
| Abstract: | The EU corporate sector has been subject to severe shocks in recent years, i.e., the administrative restrictions on activity in the context of the COVID-19 pandemic, the supply bottlenecks in its aftermath, and more recently the spike in energy prices in the context of the full-scale invasion of Ukraine by the Russian Federation. This paper uses the latest available industry- and firm-level data to quantify the impact of the spike in energy prices on cost-price dynamics and corporate profitability of non-financial corporations (NFCs). Firstly, we document price-cost margin developments at the country-industry level by computing production cost indices at quarterly frequency. In this step, input-output tables are used to construct implicit input deflators. Secondly, we plug these price-cost margin developments into the latest available financial statements of the firm to simulate the evolution of profitability over 2022-2023. Thirdly, we characterise the evolution of profitability for publicly listed EU firms, based on their published financial accounts up to 2023. In the first step, we uncover a positive relationship between production cost increases and the energy intensity of the industry, only partly compensated by producer price growth. In the second step, we find that 20% of NFCs had negative cumulative operating profits over 2022-2023. About half of these firms posted positive profits in 2021, underpinning the contribution of partial pass-through to a deterioration of corporate profitability. In the third step, we provide an indirect robustness check of our simulations, by showing that the spike in energy prices had a negative effect on NFC profitability overall. Further, we assess the role of exposure to the shock. We find that profitability growth of energy intensive firms was pushed into negative territory over 2016-2023. This result holds for gross, operating, and net profit margins. Overall, the results suggest that while there has been substantial pass-through of production cost increases to producer prices, dampening the impact on profitability, the spike in energy prices was associated with a deterioration in cost competitiveness. Longer-term challenges remain, particularly for energy-intensive industries, that require more structural solutions. |
| JEL: | C23 C67 D22 D24 |
| Date: | 2024–12 |
| URL: | https://d.repec.org/n?u=RePEc:euf:dispap:216 |
| By: | International Finance Corporation |
| Keywords: | Agriculture-Agribusiness Energy-Renewable Energy Private Sector Development-Private Sector Economics |
| Date: | 2023–09 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:41239 |
| By: | Papathanassiou, Chryssa; Nieto, María J. |
| Abstract: | Greenwashing is a generic term used for breaches and misleading claims about the sustainability credentials of various legal provisions, ranging from unfair competition, securities laws infringements and unethical advertising to wrong corporate disclosure. This paper focuses on the latter. Against the background of the significant financial flows needed to finance the transition to meet the objectives of the Paris Agreement and the EU Climate law, the EU corporate sustainability reporting rules integrated in the Corporate Sustainability Reporting Directive (CSRD) and the Corporate Sustainability Due Diligence Directive (CSDDD), as well as the EU taxonomy constitute an ambitious legislative framework which is aimed at establishing common mandatory European Sustainability Reporting Standards for companies to report comparable and relevant information required by investors and other stakeholders. This framework’s aim is to support companies in the transition to a more sustainable economy and help stakeholders and investors understand the sustainability risks in their investments (and facilitate financial flows for the transition). This framework’s aim is to support companies in the transition to a more sustainable economy and help stakeholders and investors understand the sustainability risks in their investments (and facilitate financial flows for the transition). This will help mitigate greenwashing risks because this framework raises the responsibility for inaccurate disclosure. In addition, accurate data are important for central bank operations because they can ensure that prices and the risk control framework adequately reflect climate physical and transition risks. The success of the regulatory framework will rely heavily on its credible implementation, including penalties, which will help anchor expectations and condition the behaviour of economic agents. […] |
| Keywords: | climate, disclosure, greenwashing, sustainability |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:ecb:ecbops:2025370 |
| By: | IFC; Amundi |
| Keywords: | Finance and Financial Sector Development-Capital Markets and Capital Flows Finance and Financial Sector Development-Mutual Funds Environment-Adaptation to Climate Change |
| Date: | 2023–09 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40336 |
| By: | Congressional Budget Office |
| Abstract: | Investment in wind and solar electric power is directly supported by two tax credits, the investment tax credit (ITC) and the production tax credit (PTC), which were modified and extended by the 2022 reconciliation act. In CBO’s January 2025 baseline budget projections, the ITC and PTC together increase projected deficits by $308 billion from 2026 to 2035. The tax credits provide an incentive for private-sector investment; CBO estimates that without them, investment in wind and solar electric power from 2024 to 2026 would be about one-third less than is expected with the credits in |
| JEL: | H23 H25 Q48 |
| Date: | 2025–04–11 |
| URL: | https://d.repec.org/n?u=RePEc:cbo:report:61188 |
| By: | Dünhaupt, Petra; Gräf, Helena; Jiménez, Valeria; Jungmann, Benjamin |
| Abstract: | Adequate policy space is essential for resource-rich countries to move up the value chain and seize the opportunities presented by global decarbonization and the demand for low-carbon technologies. However, WTO rules, investment and free trade agreements (FTAs) deprive nonhegemonic powers of the industrial policy tools used by successful developmental states in the past, thus reducing policy space and arguably 'kicking away the ladder'. The present article addresses these issues in the context of Chile's lithium industrial policy and the modernised EU-Chile FTA. With the objective of moving up the lithium value chain, Chile employs preferential pricing: offering lithium at a preferential price to companies that establish production sites for higher-value processes. However, the modernized FTA includes restrictions on the use of preferential pricing, as outlined in its Energy and Raw Materials Chapter (ERM) -a novel element in the EU FTAs aimed at safeguarding access to critical raw materials for the EU's Green Deal objectives. By means of document analysis and 21 expert interviews, we find that the modernised FTA and its ERM are compatible with Chile's current lithium industrial policy. Nonetheless, they further restrict Chile's policy space, potentially limiting future policy adaptations. These restrictions, alongside further national factors, may hinder the fulfilment of Chile's industrial policy goals. The article offers explanations for the negotiation outcomes and identifies factors beyond policy space that constrain the effectiveness of Chile's lithium industrial policy. |
| Keywords: | Chile, Lithium, Policy Space, Industrial Policy, Free Trade Agreement |
| JEL: | F63 O24 O25 O54 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:ipewps:313641 |
| By: | Elise Viadere |
| Abstract: | This paper explores why energy-sharing communities need policy support via network tariff adjustments and how to optimally design that support. Findings from a case study indicate that, even with high self-consumption, the energy-sharing model may not ensure participants reach break-even. Counterfactual analyses, using machine-learning techniques, indicate that capacity-term adjustments alone had minimal impact on peak consumption. Policy recommendations suggest limiting capacity-term adjustments to communities capable of actively managing peak loads through real-time data and flexible assets. |
| Keywords: | Demand-response; Energy community; Energy-sharing; Network tariffs |
| Date: | 2025–03 |
| URL: | https://d.repec.org/n?u=RePEc:ulb:ulbeco:2013/389043 |
| By: | World Bank |
| Keywords: | Environment-Adaptation to Climate Change Energy-Hydro Power Environment-Forests and Forestry Environment-Sustainable Land Management |
| Date: | 2023–09 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40350 |
| By: | Benavides (Dir. proy.), Juan (FEDESARROLLO); Cabrales, Sergio (Inv.) |
| Abstract: | En el largo plazo, en ningún país del mundo la energía se va a electrificar total mente, ni toda la electricidad se producirá con FNCER, que solo pueden generar electricidad cuando brilla el sol y sopla el viento. En Colombia, una ´transición energética´ debe subordinarse a apoyar el crecimiento de la economía, con ingreso de tecnologías de producción variables a una velocidad no mayor a la de la reducción de costos de seguridad del suministro. El ingreso acelerado de FNCER podría aumentar el riesgo de racionamiento si se sustituyen las fuentes convencionales sin considerar la seguridad del suministro. Una política óptima de expansión de la capacidad debe construir portafolios resilientes con diver sificación de fuentes, incluyendo soluciones como baterías y energía nuclear cuando sean viables comercialmente. Las autoridades plantean invertir 16, 182 MW más en FNCER durante seis años según el escenario agresivo propuesto por XM. En épocas secas hacia 2030, las plantas a gas podrían requerir operarse entre 3 y 7 horas diarias dependiendo del escenario considerado; mientras tanto, las plantas a carbón necesitan operar entre 6 y 16 horas al día bajo condicio nes similares climáticas. Además, se estima que el precio spot podría reducirse hasta un 43% bajo ciertos escenarios con alta adopción de FNCER durante períodos secos críticos si no se ajustan adecuadamente los precios ofrecidos por hidroeléctricas para compensar pérdidas potenciales debido al menor volumen generado bajo condiciones hidrológicas adversas como El Niño o sequías prolongadas. |
| Keywords: | Mercado Mayorista de Electricidad; Margen Mayorista; Electricidad; Crecimiento Económico; Colombia |
| JEL: | L94 O13 Q41 Q43 |
| Date: | 2024–12–03 |
| URL: | https://d.repec.org/n?u=RePEc:col:000124:021064 |
| By: | Mathieu Guigourez (Centre d'Economie de la Sorbonne, Université Paris 1 Panthéon-Sorbonne) |
| Abstract: | Individual actions – and individual responsibility – in regard to climate-related issues are often overlooked because they have a negligible impact at the global scale. Yet, despite having little to no impact, some people commit themselves to reducing their carbon footprint; that is, they are willingly choosing to adapt their consumption despite having no tangible impact on the issue they are tackling. Our aim is to question the permeability of economic rationality with moral (individual) responsibility at stake in climate-related issues. We provide an account of a possible bridge between deontological obligations and utility-maximisation in three different frameworks, namely Senian commitment, Kantian economics and choice under unresolved valuations conflicts. This analysis of different frameworks incorporating deontological motives in Rational Choice Theory analytically grounds individual commitments without relying on political enforcements or monetary incentives |
| Keywords: | Rational Choice Theory; Amartya Sen; Individual Responsibility; Kantian Economics; Normative Uncertainty; Commitment; Climate Ethics; Normative Decision Theory |
| JEL: | B41 D01 D72 D81 |
| Date: | 2025–02 |
| URL: | https://d.repec.org/n?u=RePEc:mse:cesdoc:25002 |
| By: | Helmut Lütkepohl; Till Strohsal |
| Abstract: | This paper analyzes possibly time-varying shock transmission in structural vector autoregressive (VAR) models when the reduced-form VAR coefficients are time-invariant and the shocks are identified through non-Gaussianity. To check for possible time-variation in the impulse responses, we propose Wald tests for two situations: (1) homoskedastic and (2) heteroskedastic structural shocks. For the latter case, the challenge is to ensure that the test does not indicate time-varying impulse responses if the changes are due only to changes in the variances of the shocks. To illustrate the usefulness of the tests, they are applied to an empirical model of the crude oil market. They support time-varying shock transmission reflected in impulse response functions that change over time. |
| Keywords: | Structural vector autoregression, independent component analysis, non-Gaussian shocks, structural break tests, heteroskedasticity |
| JEL: | C32 |
| Date: | 2025 |
| URL: | https://d.repec.org/n?u=RePEc:diw:diwwpp:dp2110 |
| By: | World Bank Group |
| Keywords: | Environment-Climate Change Mitigation and Green House Gases Environment-Climate Change and Environment Energy-Energy Conservation & Efficiency |
| Date: | 2023–10 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40546 |
| By: | World Bank Group |
| Keywords: | Environment-Climate Change Mitigation and Green House Gases Energy-Energy and Environment Macroeconomics and Economic Growth-Economic Growth |
| Date: | 2023–10 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40467 |
| By: | World Bank Group; IMF; OECD |
| Keywords: | Finance and Financial Sector Development-Finance and Development Environment-Climate Change Mitigation and Green House Gases |
| Date: | 2023–09 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wboper:40402 |
| By: | Erich Muehlegger; Reid Taylor |
| Abstract: | We estimate the effect of competition on incumbent firm pricing by using high frequency price data and the precise geographic location for all gas stations in California. Using an event study design, we find that the entry of a new station is associated with a 2.5 cent decrease in prices at incumbent stores, which equates to a 7 percent reduction in estimated retail markups. The effects are immediate, persistent and show no sign of deterrence or limit pricing behavior. In contrast, nearby exit results in precisely estimated null effects on prices with no evidence of predatory pricing in the lead up to the station departure. We show that these results are consistent across all fuel blends, dissipate with distance and are driven by less concentrated markets. Finally, we explore the asymmetric effects, showing that the difference cannot be attributed to difference in branding, proximity to highway or data quality idiosyncrasies, although we find suggestive evidence that exit tends to happen in more competitive markets and amongst less heavily trafficked stations. |
| Keywords: | competition; entry; exit; retail gasoline; market structure |
| JEL: | D40 L11 L81 Q41 R32 |
| Date: | 2025–03–05 |
| URL: | https://d.repec.org/n?u=RePEc:fip:feddwp:99661 |
| By: | Abhishek KUMAR (University of Southampton); Apra SINHA (University of Delhi); Gazi Salah UDDIN (Linkoping University) |
| Abstract: | Using administrative plant-level data from India, we estimate the effect of revenue and cost uncertainties on markup (product market power), markdown (labour market power), and combined market power. We show that historical two- and three-digit industry averages of exports, imported inputs, and oil share are valid instruments for exports, imported inputs, and oil share at the plant level. The results suggest that revenue and cost uncertainties affect markup differently: revenue uncertainty decreases markup, whereas cost uncertainty increases markup. Despite the opposite effect of these uncertainty measures on product market power, revenue and cost uncertainties tend to increase combined market power. This is because the revenue uncertainty significantly increases labour market power. Heightened cost uncertainties reduce labour market power but by less compared to increases in product market power. Given the results obtained in this paper, it is important to make a distinction between revenue and cost uncertainty to understand their cyclical nature. |
| Keywords: | Markup, Markdown; Labour Share; Uncertainty; Exchange Rate Volatility; Oil Price Volatility |
| JEL: | D21 D22 |
| Date: | 2025–03–04 |
| URL: | https://d.repec.org/n?u=RePEc:era:wpaper:dp-2024-37 |