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on Energy Economics |
| By: | Christoff Scherrer (Kassel Institute for Sustainability & Global Labour University) |
| Abstract: | This paper explores the possibility of using voluntary carbon credits to retire coal-fired power plants early. It introduces carbon emission trading using the example of the substantial European emissions trading market. It presents recommendations for phasing out coal power plants and discusses the challenges of calculating plant proprietors' losses and carbon emission savings. It also outlines the specific challenges of voluntary carbon credits and the need to monitor carbon credit deals. These issues are illustrated with the world’s first Energy Transition Mechanism transaction for the early retirement of a coal plant owned by ACEN in the Philippines: the South Luzon Thermal Energy Corporation (SLTEC). It analyzes the financial transactions carried out by the power plant owner and the envisaged use of voluntary carbon credits. The paper concludes that there are many obstacles to moving beyond a few pilot projects. |
| Keywords: | energy transition; voluntary carbon credits; coal power plant; Philippines |
| JEL: | Q54 Q58 |
| Date: | 2025–09 |
| URL: | https://d.repec.org/n?u=RePEc:phs:dpaper:202505 |
| By: | Tomás Domínguez-Iino; Jonathan T. Elliott; Allan Hsiao |
| Abstract: | The green energy transition will be powered by the mining and processing of lithium, nickel, and cobalt, which are critical for the production of advanced batteries. These minerals are concentrated geographically but traded globally, allowing key mining countries to exercise market power through policy intervention. Advanced batteries use multiple minerals in combination, and this joint use creates interdependence across mineral markets. We study the geopolitical implications of these forces and their consequences for green technology adoption worldwide. We quantify supply chain vulnerability, international policy spillovers, and the potential for mineral cartels. |
| JEL: | L13 L72 Q37 Q56 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35654 |
| By: | Javier Gonzalez-Ruiz; Carlos Rodriguez-Pardo; Alice Di Bella; Paolo Mastropietro; Jose Pablo Chavez-Avila; Massimo Tavoni |
| Abstract: | European countries are debating policies to mitigate the increased energy costs caused by renewed geopolitical tensions, while pursuing decarbonization and electrification. A notable example is Italy's 2026 Decreto Bollette package, which proposes to remove the carbon price equivalent from the bids of certain gas-driven power plants to wholesale electricity markets, among other provisions. We use this as a case study to assess the long-term implications of suppressing the carbon price signal in the electricity market for investment, emissions, and consumer costs. We employ a stylized Italian power system using MARLEY, a multi-agent reinforcement learning framework focused on long-term electricity market assessments. In this framework, we test this policy across configurations with varying levels of support for green investment, resource adequacy, and flexibility. Results show that partial suppression of the carbon price signal yields short-term cost reductions but only a minor long-term effect on total system costs, as the deferred emissions are ultimately repaid by consumers. CO$_2$ emissions rise across most configurations since suppressing the price signal erodes incentives for renewable and storage investment. Only the most ambitious configurations for supporting green investment avoid this outcome, but they do so by marginalizing the wholesale price signal itself, thereby requiring a commitment to a hybrid market paradigm that is in contradiction with the rationale of the proposed price intervention. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.12363 |
| By: | R. Andrew Butters; Jackson Dorsey; Ivan Rudik |
| Abstract: | How much does pricing pollution cut aggregate emissions, and at what cost? We develop a microfounded equilibrium model of firm production and abatement that can be estimated from standard firm financial and emissions data, without observing abatement effort directly. The model captures three adjustment margins: short-run input substitution, reallocation of output from dirty to cleaner firms, and long-run clean technology adoption. Applying it to the first 17 years of the European Union Emissions Trading System (EU-ETS), we find input substitution is rigid: firms cannot cut emissions in the short run without cutting output. Reallocation instead drives nearly all of the short-run aggregate emissions response, concentrated in sectors with heterogeneous emissions intensities, like power and cement, or with elastic demand, like refining. Clean technology adoption also responds causally to permit price shocks, reducing firms’ emissions intensity over the five years that follow. Doubling the permit price cuts aggregate emissions 23% in the short run and 31% in the longer run after induced clean technology adoption. In the short run, output falls by 4%, primarily because carbon costs pass from upstream polluting industries like electricity to downstream producers. In the long run, output falls just 2.5%, as clean technology adoption dampens these supply-chain impacts. Carbon pricing thus delivers substantial emissions reductions with moderate output effects, and much of the economic burden falls on downstream firms through higher upstream input costs. |
| JEL: | D22 E23 Q52 Q54 Q58 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35682 |
| By: | Tao, Yingnian (Lancaster University); Ryan, Mark |
| Abstract: | The green energy transition has recently become a hot topic in public and policy debates in the UK. This study employs corpus-assisted analysis to examine how the green energy transition is represented in left-leaning and right-leaning UK newspapers (2015-2024). Specifically, we identified the temporal changes in frequencies of emotional reporting and analysed and compared five group of strong emotion words (represented by crisis, damage, greenwashing, catastrophe, and wealth) through collocation analysis and concordance analysis. Our findings indicate that although the sentiment of coverage is more positive than negative, negative sentiment is gradually increasing over time. Both sides cover environmental and economic aspects of the transition; however, they differ in their priority area and the way they engage with these areas. Left-leaning newspapers emphasise environmental degradation, blame fossil fuels for the climate crisis, and call for urgent action. Right-leaning newspapers focus more on the economic impacts of transition, often framing policies as threats to jobs or prosperity while downplaying accountability for emissions. Across the spectrum, reporting tends to adopt a techno-optimist, business-as-usual stance that rarely challenges the idea of continuous economic growth. Implications for media, readers, and policymakers are discussed. |
| Date: | 2026–07–31 |
| URL: | https://d.repec.org/n?u=RePEc:osf:socarx:dn8cp_v2 |
| By: | Rim Berahab; Sabrine Emran |
| Abstract: | The global energy system has entered a period of acute structural stress following the strikes by the United States and Israel on Iran in late February 2026, and the subsequent disruption of flows through the Strait of Hormuz. According to the International Energy Agency, the resulting shock marks the most severe disruption to global energy markets since the 1970s oil crises, with systemic characteristics comparable to the combined effects of those crises and the 2022 Russia-Ukraine energy shock. This policy paper examines the mechanics of the oil-price shock, then assesses the structural importance of the Strait of Hormuz as a global energy chokepoint, through which an estimated 17.8 million barrels per day of crude oil and LNG transited before the Iran conflict. It highlights the limited substitutability of existing bypass infrastructure under conditions of sustained disruption. It also evaluates the fragmentation of the OPEC+ framework, including the United Arab Emirates’s announced withdrawal from the alliance on May 1, 2026, marking a critical point in the erosion of coordinated production management among major Gulf exporters. Finally, it analyses the role of renewable energy as a structural variable in the crisis, not as a short-term buffer, but as an accelerating force reshaping the geopolitical foundations of energy security. The Hormuz disruption should therefore be understood not only as a price shock, but as a systemic stress test of global energy governance, exposing deep structural fragilities and accelerating realignments across markets, alliances, and the energy transition. |
| Date: | 2026–06 |
| URL: | https://d.repec.org/n?u=RePEc:ocp:pbtrad:pb29_26 |
| By: | Daniel Lopez Garcia; Robert D. Metcalfe; Andrew R. Schein; Yixin Sun |
| Abstract: | As renewable generation plays a growing role in the energy system, periods of negative wholesale electricity prices are becoming increasingly common and are expected to grow dramatically over the next ten years. Traditionally, system operators respond by paying generators, especially renewables, to curtail production, or mandating that they do so without compensation. In this study, we propose and test a novel alternative: exposing consumers to free and negative prices to stimulate demand when supply is abundant. We implemented large-scale nationwide natural field experiments simultaneously in Great Britain and Spain, with roughly 60, 000 residential customers in each country randomized to receive varying financial incentives to “turn up” their electricity. We found that demand increased substantially as prices fell to zero, but paying customers to consume beyond zero price yielded little additional response. Households with electric vehicles and rooftop solar had a larger elasticity than households without such technologies, suggesting demand turn-up becomes more effective as households adopt low-carbon technologies. In Great Britain, consumption was largely shifted from adjacent hours, while in Spain the increase appeared to represent net new demand. We develop a welfare framework showing conditions under which demand turn-up improves on curtailment; we find that by inducing additional consumption in periods and locations where the marginal cost of supply is low, demand turn-up generates welfare gains that curtailment leaves uncaptured. |
| JEL: | Q4 Q41 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35530 |
| By: | Sandra Batten (Bank of England and Durham University Business School); Stephen Millard (NIESR, Durham University Business School and Portsmouth University) |
| Abstract: | In this paper, we use a dynamic general equilibrium model to examine the effect of the move to net zero in the United Kingdom on productivity. One argument is that the transition is likely to be productivity-reducing, as it will involve a move from more to less efficient means of producing. Alternatively, it could be argued that the transition will be productivity-enhancing, as the capital investment required to bring about this move leads to a rise in productivity, both within the specific ‘greening’ industries and more generally via productivity spillovers to the rest of the economy. Our model enables us to examine how this potential trade-off varies depending on whether we look at the short, medium or long run. We find that the introduction of a carbon tax, applied to encourage the move towards net zero, reduced GDP and total hours worked, but since total hours fell by more than GDP, increased productivity. As electricity becomes more substitutable for petrol and gas, the effect on productivity becomes more positive as GDP recovers while total hours remain permanently lower than initially. Finally, our results suggest that unless investment in green technology leads to significant technological gains elsewhere, it is unlikely that the move to net zero will have a large effect on productivity growth above and beyond the direct effect resulting from the capital deepening that will be associated with it. |
| Keywords: | Climate change;dynamic general equilibrium;carbon tax;climate policy;energy;renewable energy |
| JEL: | Q28 Q38 Q43 Q48 Q58 E32 |
| Date: | 2026–02–13 |
| URL: | https://d.repec.org/n?u=RePEc:boe:boeewp:023293 |
| By: | Britto, Anthony; Scharnhorst, Leandra; Kleinebrahm, Max; Fichtner, Wolf |
| Abstract: | The DEIMOS project developed and applied two complementary open-source modeling frameworks, FORECAST-Sites Extended and iSTEDS, together with openly accessible industrial datasets. These resources enable transparent and reproducible analysis of industrial decarbonization pathways across sectors, technologies, and locations. FORECAST-Sites Extended captures site-specific investment decisions, including asset vintages, reinvestment timing, technology costs, and infrastructure access, while iSTEDS assesses industrial electrification and demand-side flexibility. Applied in three case studies, the models highlighted the roles of hydrogen, carbon capture, and electrification in industrial transformation. Together, the models and datasets provide an open-science foundation for analyzing industrial transition and supporting future energy and climate policy. |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:kitiip:343114 |
| By: | Felix B. Schäfer (Institute of Energy Economics at the University of Cologne (EWI)); David Wohlleben (Institute of Energy Economics at the University of Cologne (EWI)) |
| Abstract: | In the EU, hydrogen production must meet additionality and temporal correlation requirements to qualify as a renewable fuel of non-biological origin (RFNBO), which puts renewable power purchase agreements (PPAs) into focus. We first derive hypotheses on how RFNBO criteria, renewable electricity support schemes, and the default risk of hydrogen suppliers jointly affect hydrogen supply costs. We then model the supplier’s electricity procurement and asset configuration problem as a stochastic optimization under weather-year uncertainty, incorporating risk preferences. Further, we approximate the near-optimal solution space by exploiting the problem’s convexity. Finally, we test the hypotheses in a case study for Germany: We find RFNBO criteria to raise hydrogen supply costs by 14–41 EUR/MWhH2 , with additionality, default risk, and hourly matching being the main cost drivers. The interaction of renewable electricity support schemes with the additionality criterion further shapes the technological and regional composition of the optimal PPA portfolio. Tighter temporal correlation enlarges the optimal PPA portfolio and makes surplus electricity sales a key cost-reduction channel. Annual supply costs vary by 4–20 EUR/MWhH2 between the most and least favorable weather years, with the largest variations under hourly matching. A risk-averse supplier weighs expected costs against interannual costs variability, though the trade-off appears small. The near-optimal solution space contains PPA portfolios of different compositions. However, its size and thus the hydrogen supplier’s flexibility in technology choice shrink with stricter RFNBO criteria, especially when accounting for the hydrogen supplier’s default risk. We discuss that hydrogen suppliers’ default risk is especially relevant during the market ramp-up phase, and that introducing the additionality criterion and tight temporal matching regimes without de-risking instruments could further slow down market ramp-up dynamics. |
| Keywords: | RFNBO; Power purchase agreement (PPA); Renewable energy support schemes; Levelized cost of hydrogen (LCOH); Near-optimal solutions; Environmental policy |
| JEL: | C61 D81 Q42 Q48 |
| Date: | 2026–09–01 |
| URL: | https://d.repec.org/n?u=RePEc:ris:ewikln:023573 |
| By: | Toby C. Monsod (School of Economics, University of the Philippines Diliman) |
| Abstract: | We set out to understand the resource requirements of the Philippines’ low carbon transition, the sources of low carbon finance, and the chances that supply of low carbon finance will be responsive to demand at scale. We find that the country will require an initial USD 94.2 billion for measures that are expected to contribute an emissions reduction of 990mmtCO2e out of a pledged 2505 mmtCO2e, or 39.5 percent of the country’s Nationally Determined Contribution, and that private and public capital are expected to cover this amount in a 63 - 37% split. We determine that prospects are relatively high for an overwhelming 95.4% of the required amount, an assessment that rests on the positive market response to energy sector initiatives and management, and hinges critically on the government’s ability to extract pre-requisite transmission investments from its privately-owned transmission service provider in a timely manner. For 1.8%, prospects are fair and involve technologies dependent on nascent markets or behavioral change, such as accepting Energy Efficiency as the “first fuel†in the energy mix and all that this implies. For the remaining 2.8%, prospects are low, hindered by governance dysfunctions that have long-undermined efficiency in the agriculture, waste and road-based public transport sectors. While representing just 2.8% of the required amount, these programs and measures account for 30% of the 990 mmtCO2e emissions reduction targeted and, more importantly, feed into or coincide with food and water security strategies prioritized under the country’s climate change adaptation plan. Securing the 2.8% is not optional in other words. Thus, fixing institutions is the first and most important finance strategy moving forward. |
| Keywords: | low carbon transition; low carbon finance; green finance; Philippines’ Nationally Determined Contribution (NDC); governance |
| JEL: | Q54 Q58 Q01 O20 O16 O53 |
| Date: | 2026–05 |
| URL: | https://d.repec.org/n?u=RePEc:phs:dpaper:202605 |
| By: | Karlsson, Jimmy (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Carbon taxation is one of the main policy instruments for reducing greenhouse gas emissions, yet there is still limited evidence on its effects on firms and workers. This paper studies the environmental and economic effects of carbon taxation, with a particular focus on heterogeneity in labor demand across worker groups. I exploit a reform that increased the effective carbon tax for a subset of Swedish manufacturing firms between 2011 and 2018, and combine administrative firm data with matched employer-employee records in a difference-in-differences design. The reform reduced emissions by about 30%, primarily through substitution away from fossil fuels toward biofuels and district heating. It also reduced revenue and employment, with the strongest negative effects concentrated among emission-intensive firms. The employment effects are driven mainly by older workers without a high school degree, although older, highly educated workers are also negatively affected in the most exposed firms. Additional evidence suggests that firms adjusted labor demand primarily through lower hiring rather than higher separations. Scaled by the average increase in effective tax rates (measured in euro per ton CO2), the estimates imply semi-elasticities of -0.58% for emissions and -0.20% for employment among low-educated workers. These results suggest that carbon taxation can substantially reduce industrial emissions, but with concentrated labor-market costs. |
| Keywords: | Carbon taxation; Climate change; Firm performance; Inequality; Employment |
| JEL: | H23 J23 L60 Q52 Q58 |
| Date: | 2026–08–24 |
| URL: | https://d.repec.org/n?u=RePEc:hhs:iuiwop:1564 |
| By: | Ludwig, Maren; Jarvis, Stephen |
| Abstract: | Economic development, rising temperatures, and decarbonisation policy will have profound implications for electricity systems worldwide. Using data on appliance ownership and hourly electricity demand for a large, diverse set of countries, we provide new global evidence on how temperature affects electricity demand. Combining our estimates with climate and development projections, we show that the adoption and use of both air conditioning and electric heating will increase average per capita electricity demand in all regions by mid-century, with peak demand during periods of extreme heat or cold rising nearly twice as much. Global annual electricity grid costs increase by over $0.3 trillion per year in 2050, with the largest burden falling on low- and middle-income countries. Our findings underscore the growing importance of appliance adoption and climate change in electricity system planning. |
| Keywords: | electricity demand;temperature;climate change;development |
| JEL: | Q40 L94 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:ehl:lserod:140636 |
| By: | Wansleben, Leon |
| Abstract: | Renewable electrification - upstream switches to variable renewable energy sources such as wind and solar, combined with downstream electrification - implies a profound reconfiguration of the energy-society nexus. This is evidenced by significant frictions and political conflicts that intensify at the very moments at which the diffusion of the respective technologies gains pace. Existing transition scholarship has not sufficiently captured these dynamics since it lacks a conception of regime instability and trusts too optimistically in transition progress through economic and policy feedbacks. I leverage the concept of "mismatch" or "structural adjustment" crises from innovation economics to capture situations in which technology adoption happens broadly and quickly, while the development of integrative mechanisms adjusted to the demands of renewable energy lags behind. We see this evidenced by mismatch crises that manifest in three domains: Infrastructures facilitating energy production and use are maladapted to variable power; status orders are destabilized amid growing distributional conflict; and institutions of energy governance are not appropriately reformed. Identifying these manifestations of mismatch crisis does not automatically imply a need to slow down the transition but rather to explore much-needed reforms to establish the integrative foundations for societies powered by renewables. |
| Abstract: | Die Elektrifizierung des Energieverbrauchs, kombiniert mit Stromerzeugung aus erneuerbaren Energien, impliziert eine tiefgreifende Neuordnung des Verhältnisses von Energie und Gesellschaft. Dies zeigt sich an der Zunahme von Friktionen und politischen Konflikten in genau jenen Phasen, in denen die Diffusion der jeweiligen Technologien an Fahrt gewinnt. Die bisherige Forschung zu Energiewenden hat diese Krisen- und Konfliktdynamiken unzureichend erfasst, weil ihr ein Konzept von Regimeinstabilität fehlt und sie allzu optimistisch auf Fortschritte durch ökonomische und politische Rückkopplungen vertraut. Ich rekurriere auf den Begriff der strukturellen Anpassungskrisen aus der Innovationsökonomik, um Situationen zu erfassen, in denen Technologien in der Breite und mit hoher Geschwindigkeit diffundieren, während die Entwicklung integrativer Mechanismen, zugeschnitten auf die Anforderungen einer erneuerbaren Elektrifizierung, hinterherhinkt. Entsprechend manifestieren sich Anpassungskrisen in drei Dimensionen: Infrastrukturen zur Energieerzeugung und -nutzung sind nicht auf variable Quellen von Energie eingestellt; Statusordnungen sind durch wachsende Verteilungskonflikte destabilisiert; und Institutionen der Governance von Energiesystemen sind nicht angemessen reformiert. Die Identifikation solcher Anpassungskrisen bedeutet nicht automatisch, dass Energiewenden verlangsamt werden sollten; vielmehr gilt es, dringend notwendige Reformen auszuloten, um die integrativen Grundlagen für Gesellschaften zu schaffen, die sich mit erneuerbaren Energien versorgen. |
| Keywords: | decarbonization conflicts, energy transitions, governance and institutions of energy systems, structural adjustment crises, Dekarbonisierungskonflikte, Energiewende, Governance und Institutionen des Energiesystems, strukturelle Anpassungskrisen |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:mpifgd:343081 |
| By: | Bierbrauer, Felix |
| Abstract: | Should climate policy rely on a price of Carbon that is uniform across sectors? This paper studies this question from a public finance perspective. It is found that a justification for a uniform price can be given, but it relies on strong assumptions, among them indifference with respect to the distributive consequences of climate policy. Distributive considerations may imply that sectors whose output is consumed mostly by "the poor" should contribute less to meeting the government’s emission target, whereas sectors whose output is consumed mostly by "the rich" should contribute more. |
| Keywords: | Climate policy |
| JEL: | H21 H22 Q58 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19202 |
| By: | Loubna Eddallal |
| Abstract: | The renewed instability in the Middle East has exposed Africa's continued vulnerability to external energy shocks. Shipping disruptions through the Strait of Hormuz, the maritime chokepoint through which roughly one-fifth of global oil and LNG supplies transit, have once again demonstrated that African fuel security remains highly dependent on geopolitical developments beyond the continent. While many African economies have traditionally relied on refined petroleum imports from Gulf producers, the current crisis is accelerating the emergence of a continental alternative. The Dangote Refinery is increasingly functioning as a continental contingency mechanism by supplying refined petroleum products to African markets facing supply uncertainty. Although this role is driven by commercial incentives rather than coordinated policy, it represents an important shift in Africa's energy geography: for the first time, a continental refining hub possesses the scale to partially cushion African markets against external supply disruptions and strengthen Africa's control over the oil value chain. Dangote's potential to serve as a strategic energy supplier for Africa creates significant trade and energy-security opportunities for several African countries, particularly Morocco, whose aviation market has been expanding rapidly since 2024. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:ocp:pbtrad:pb48_26 |
| By: | Stephen C Littlechild; Harry Bush; Alan DA Sutherland; Gavin Knott; Andrew Walker |
| Keywords: | Negotiated settlements, customer engagement, energy regulation, water regulation, airports |
| JEL: | L51 L94 L95 L97 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2618 |
| By: | Jacopo Ghirri; Carlos Rodriguez-Pardo; Lara Aleluia Reis; Massimo Tavoni |
| Abstract: | The European Union has committed to reducing greenhouse gas emissions 55% below 1990 levels by 2030, but whether current trends are compatible with this ambition remains uncertain. We apply deep learning to high-resolution socioeconomic and sectoral data across EU27 member states till 2023 to project sectoral CO$_2$ trajectories under current trends, extrapolating observed sectoral momentum without assuming changes in the pace or effectiveness of the policy environment beyond what is already reflected in historical data. We project that EU27 emissions will exceed the 2030 target by 35% (620 Mt CO$_2$ shortfall), with only a small minority of countries on trajectories consistent with the bloc's commitments. While the Power sector achieves target-consistent reductions driven by the renewable transition, Mobility shows minimal progress and accounts for over a third of total emissions by 2030, reflecting a structural inertia across member states rather than geographically concentrated lag. Our findings indicate that substantial additional intervention is required to close Europe's ambition-implementation gap, and call for establishing up-to-date energy information in Europe. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.18690 |
| By: | Josh Kirk; Evgenia Passari; Hélène Rey |
| Abstract: | Trade networks underpinning the energy transition are endogenous economic objects, and their structure is a source of market power. Using bilateral trade data for thirteen electrification metals over 1995–2023, we show that trade in these materials has reorganised into a hub-and-spoke system centred on China, in sharp contrast to the diffuse, multilateral structure of fossil fuels. This centrality did not follow from resource endowments: China holds few of the underlying reserves. It was built through processing investment, industrial policy, and commodity-targeted development finance—an equilibrium outcome rather than a geographical accident. We formalise this in a stylised model in which a country chooses how central to become, and show that centrality maps into pricing power: the world price response to a strategic supply cut is stronger when the network is more concentrated and downstream demand and fringe supply are more inelastic. Constructing text-based, commodity-specific supply shocks and estimating local projections, we find that supply contractions in critical metals raise US and EU consumer prices by roughly twice as much as comparable fossil-fuel shocks, and more persistently. Centrality is therefore not merely descriptive: it creates leverage over global prices. The green transition reduces strategic dependence on hydrocarbon exporters but reconstitutes it around mineral supply chains. |
| JEL: | F49 F50 F60 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35497 |
| By: | Díaz-Pastor, Santos J.; Liu, Yang; Pérez-Arriaga, Ignacio J. |
| Abstract: | This paper proposes a replicable regulatory and financial framework to achieve universal electricity access as a core component of a just energy transition in Sub-Saharan Africa. It argues that universal access is feasible under realistic constraints when electrification planning, tariff regulation, and capital mobilization are designed as one coherent system rather than separate workstreams. The analysis rests on a computational, multi-period financial model that integrates individual interacting sub-models for every actor in the distribution segment. Versions of the same overall approach are applied to three countries, spanning different starting points and sector structures. Uganda provides the reference implementation in the wake of an expiring private distribution concession; Zambia recalibrates the same logic to a distressed national utility and a thin domestic revenue base; and Madagascar—where the framework is already being applied—shows it moving from design to district-scale delivery in the lowest electricity access setting of the three. The central mechanism is an integrated national planning, regulatory, business, and financing architecture that coordinates grid extension, mini-grids, and stand-alone systems within a single distribution-level financial plan. The framework separates two gaps that are routinely mixed—the viability gap, the recurring shortfall between affordable tariff revenues and the regulated cost of service, and the financing needs, the timing mismatch between front-loaded investment and gradual cost recovery—and shows that they each call for a distinct instrument. The evidence indicates that universal access can be reached without permanent reliance on external grants, and that extending the access horizon rather than compressing investment improves feasibility while still reaching everyone—so that the design becomes a problem of finding an electrification target year, a pattern of overall subsidy, and tariffs that are just right, each neither too much nor too little. The paper reframes universal access as a challenge of cost allocation and institutional design, showing that affordability, inclusion, and financial sustainability are not competing objectives once electrification is designed as one system. |
| Date: | 2026–08–31 |
| URL: | https://d.repec.org/n?u=RePEc:wbk:wbrwps:11439 |
| By: | McDowall, Will; Fuchs, Janina |
| Abstract: | Policymakers globally have been and remain interested in understanding the scale of economic activity associated with various aspects of the green economy. But defining what is ‘green’ is not straightforward, and standard industrial classifications are unhelpful for many areas of green activity which involve relatively new technologies. This research has been funded by the Office for National Statistics as part of the research programme of the Economic Statistics Centre of Excellence (ESCoE). The report reviews the definitions of ‘green’ economic activity used in a variety of contexts, and considers whether and how the UK’s approaches to estimating the ‘Environmental Goods and Service Sector’ could be improved. |
| Keywords: | Green Economy; Environmental Policy; Green Jobs; Environmental Regulation; Sustainability Indicators; Green Economic Activity; Environmental Accounting; Green Technologies; Environmental Data |
| JEL: | E01 Q56 Q58 |
| Date: | 2025–07–30 |
| URL: | https://d.repec.org/n?u=RePEc:eoe:escoed:escoe-dp-2025-09 |
| By: | Thiel, Zarah; Gonzalez-Gordon, Ivan; Löschel, Andreas |
| Abstract: | Scaling of renewable energy (RE) delivers global mitigation and local co-benefits, such as enhanced energy security. Narratives and policies in the energy transition differ in their advocacy of international cooperation or competition, reflecting different priorities in securing co-benefits for one's own country or others. We conduct a pre-registered information provision experiment with 4, 000+ representative respondents in Germany and Spain analyzing two novel determinants of locational mitigation preferences: moral universalism-altruism towards strangers versus in-group members- and economic narratives about the energy transition. In our 2x2 design, treatments manipulate the location-home versus developing country-of required investments in renewables and resulting cobenefits. We identify a universalism gap, underpinning the moral universalism literature: universalist individuals show stronger support for foreign RE projects than communitarians. While co-benefit narratives shift average policy preferences, they do not close this moral divide in preferences, even under narratives targeting communitarian audiences. Despite notable differences between Germany and Spain with respect to their technical and institutional environment to scale RE, the effects of the narratives and the association between moral universalism and policy preferences are consistent across both countries. Overall, our results indicate that moral foundations strongly shape locational mitigation preferences, and that communicating positive spillovers to the home country from RE investments abroad is an effective narrative to build support for climate transfers. |
| Abstract: | Der Ausbau erneuerbarer Energien (EE) trägt weltweit zur Eindämmung des Klimawandels bei und bringt lokale Zusatznutzen mit sich, wie beispielsweise eine verbesserte Energiesicherheit. Die Diskurse und politischen Strategien im Rahmen der Energiewende unterscheiden sich darin, ob sie internationale Zusammenarbeit oder Wettbewerb befürworten, was unterschiedliche Prioritäten bei der Sicherung von Zusatznutzen für das eigene Land oder für andere Länder widerspiegelt. Wir führen ein vorab registriertes Experiment zur Informationsvermittlung mit über 4.000 repräsentativen Befragten in Deutschland und Spanien durch, in dem wir zwei neuartige Determinanten der Präferenzen für den Standort von Klimaschutzmaßnahmen analysieren: moralischen Universalismus - Altruismus gegenüber Fremden im Vergleich zu Mitgliedern der eigenen Gruppe - und wirtschaftliche Narrative zur Energiewende. In unserem 2x2-Design manipulieren die Behandlungsgruppen den Standort - Heimatland versus Entwicklungsland - der erforderlichen Investitionen in erneuerbare Energien und der daraus resultierenden positiven Nebeneffekte. Wir identifizieren eine Universalismus-Kluft, die die Literatur zum moralischen Universalismus untermauert: Universalisten zeigen eine stärkere Unterstützung für ausländische Projekte im Bereich erneuerbarer Energien als Kommunitaristen. Während Narrative zu Mitnutzen die durchschnittlichen politischen Präferenzen verschieben, schließen sie diese moralische Kluft in den Präferenzen nicht, selbst bei Narrativen, die sich an ein kommunitaristisches Publikum richten. Trotz bemerkenswerter Unterschiede zwischen Deutschland und Spanien hinsichtlich ihres technischen und institutionellen Umfelds für den Ausbau erneuerbarer Energien sind die Auswirkungen der Narrative und der Zusammenhang zwischen moralischem Universalismus und politischen Präferenzen in beiden Ländern konsistent. Insgesamt deuten unsere Ergebnisse darauf hin, dass moralische Grundlagen die Präferenzen hinsichtlich standortbezogener Klimaschutzmaßnahmen stark beeinflussen. |
| Keywords: | economic narratives, moral universalism, co-benefits, climate mitigation, renewable energy, survey experiment |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:rwirep:343082 |
| By: | Adrien Bilal; Thibault Ingrand; Diego R. Känzig |
| Abstract: | This paper develops a theory of balanced growth and optimal climate policy in an integrated assessment framework. Balanced growth is possible despite climate change, but at a slower rate. Two distinct policy regimes emerge because emissions permanently raise carbon stocks. For low damages, optimal growth coincides with the laissez-faire and carbon is priced at a constant rate. For high damages, optimal policy caps temperature growth to prevent escalating losses and achieve faster economic growth than in the laissez-faire by pricing carbon at an increasing rate. We quantify our model and show that empirical damage estimates span both regimes. For low damages, optimal policy achieves a 1% welfare gain with 3 to 8°C of warming per century and no change in long-run growth. For high damages, optimal policy raises annual growth by 0.8 percentage points and achieves a 26% welfare gain by capping warming at 0.4°C per century. |
| JEL: | E23 H23 O44 Q54 Q56 Q58 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35573 |
| By: | Zia, Mumtahinah; Akhundjanov, Sherzod B.; Kim, Man-Keun |
| Keywords: | Resource /Energy Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404752 |
| By: | Eoghan O'Neill (University College Dublin); Sofia Velasco (Banco de España) |
| Abstract: | The question of how oil supply news shocks transmit to real activity, financial conditions and regional labor markets is back at the center of the macroeconomic research agenda. To answer this question, we introduce the Factor Bayesian Additive Regression Tree (FABART) model, a nonlinear factor-augmented vector autoregression model, and apply it to a large U.S. macro-financial dataset with externally identified oil supply news shocks. The framework incorporates a flexible nonparametric measurement equation that allows nonlinear transmission to emerge from the data without imposing a specific functional form on the asymmetry. We find that adverse oil supply news shocks generate stronger and more persistent contractions in real activity than the expansions associated with favorable shocks of comparable magnitude, with especially pronounced differences in industrial production, interest rates and equity prices. Employment responses are highly heterogeneous across U.S. states, with substantially stronger contractions in manufacturing-intensive regions than in energy-producing states. Across shock magnitudes, nonlinearities arise mainly between very small and moderate oil-price movements: small shocks generate weak and imprecisely estimated responses, while even moderate shocks produce economically meaningful effects on industrial production and regional employment. Larger shocks, however, do not systematically generate proportionally stronger responses across variables and shock signs. |
| Keywords: | Bayesian FAVAR, nonlinear models, non-parametric techniques, oil price shocks, factor models |
| JEL: | C11 C32 E32 Q43 |
| Date: | 2026–09 |
| URL: | https://d.repec.org/n?u=RePEc:bde:wpaper:2627 |
| By: | Tiziano Distefano; Luigi Reatti; Mario Biggeri; Cristina Vaquero-Piñeiro |
| Abstract: | This paper, considering regional disparities in climate change and policy impacts, highlights the need for a multi-regional level modelling that accounts for non-identical socio-economic and environmental dynamics at the sub-national level. Through a systematic literature review, we aim to identify and summarise heterogeneous approaches and research’s focus from existing literature concerning multi-level and multi-regional models used to address sustainability issues. We identify the most relevant themes, trends and topics investigated by the papers for which multi-level models have been used. While environmental and ecological issues are frequently addressed by these models, social dynamics are not particularly investigated and little to no interest is devoted to regional-national links. From the methodological perspective, most of the computational models employed utilise static systems (primarily Input-Output and CGE) and dynamic Integrated Assessment Models (IAMs). The paper provides a welcome basis for how multi-level models can contribute to addressing sustainability issues in economic research. Indeed, national areas deal with non-identical climate shocks and are characterised by inconsistent socio- economic dynamics. Through an analysis of the current literature, of relevant papers concerning multi-level and multi-regional models, and of analyses spanning across multidisciplinary subjects, the most relevant themes, trends and topics are shown. This examination shows how social dynamics are not particularly investigated in the considered papers, and little to no interest is devoted to regional-national links. Moreover, this literature exploration highlights that most computational models employed utilise IAMs and static systems (primarily Input-Output and CGE) and that the interest concerning ecological economics related issues, has been growing in the past years. |
| Keywords: | Sustainability; Energy Transition; Environment; Multi-level; Multi-regional; Climate Policy; IAMs, I-O; CGE; Ecological Economics |
| JEL: | C6 Q5 Q4 R1 D6 O1 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:frz:wpaper:wp2026_06.rdf |
| By: | Clemens Stiewe |
| Abstract: | Long-term transmission rights (LTTRs) are designed to support hedging in interconnected European electricity markets. LTTR auction prices have historically fallen short of forward market prices, signaling limited arbitrage. This paper studies the interaction of transmission rights and forward markets. Option pricing theory predicts that LTTR holders take short forward positions in importing markets and long forward positions in exporting markets to lock in arbitrage profits. Empirically, I find a corresponding price effect in the German electricity forward market immediately after LTTR auctions, using panel regression on EEX futures contracts traded between 2018 and 2025. This shows that LTTR holders can achieve systematic rents, indicating an inefficient regulatory intervention and a transfer from consumers to LTTR holders. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2607.28790 |
| By: | Cabon-Dhersin, Marie-Laure; Poyago-Theotoky, Joanna; Raffin, Natacha |
| Abstract: | We explore the interplay of competition and environmental policies to address the question of whether green antitrust has beneficial effects in terms of both environmental and consumer welfare performance. We focus on two environmental policy tools, an emission tax and an emission standard, and explore three particular configurations: competitive ‘green R&D, collaborative ‘green’ R&D in the form of a joint lab, and the benchmark case of no ‘green’ R&D. Firms compete in the product market by selling a homogeneous product, either by setting prices (Bertrand competition) or quantities (Cournot competition) while facing convex costs. We show that ‘green antitrust’ can unambiguously improve the effectiveness of environmental policy without undermining the interests of either consumers or producers, establishing a ‘win-win-win’ outcome. |
| Keywords: | Environmental Economics and Policy, Sustainability |
| Date: | 2026–08–31 |
| URL: | https://d.repec.org/n?u=RePEc:ags:feemwp:410235 |
| By: | Jan Carlo B. Punongbayan (School of Economics, University of the Philippines Diliman) |
| Abstract: | This paper estimates the pass-through of world oil price innovations to Philippine fuel prices and headline CPI, and decomposes total CPI pass-through into a fuel-basket component and a residual non-fuel component. Using a structural VAR and 25 years of monthly pump price data, I find that a 10 percentage point increase in year-on-year oil price growth is associated with about a 4.9 percentage point increase in gasoline price growth and a 6.6 percentage point increase in diesel price growth at 12 months, while the corresponding effect on headline CPI inflation is about 0.65 percentage points. The residual non-fuel component accounts for the larger share of the CPI response, though its estimated magnitude is somewhat sensitive to the estimation method. Results are robust to extensions with the exchange rate and rice prices, local projections with HAC inference, alternative data transformations, sub-period splits around the TRAIN Law, and an alternative pump price series. |
| Keywords: | oil price pass-through; consumer prices; structural VAR; Philippines |
| JEL: | E31 Q43 C32 F31 |
| Date: | 2026–03 |
| URL: | https://d.repec.org/n?u=RePEc:phs:dpaper:202603 |
| By: | Michele Fioretti; Kavanaugh FitzPatrick; Alessandro Iaria |
| Abstract: | Economic sanctions on oil-producing autocracies change not only the quantity of oil but also how it is produced. Combining field-level production data with satellite measurements of gas flaring and atmospheric methane across six Latin American countries from 2012 to 2024, we study the U.S. sanctions on Venezuela. Per-barrel gas flaring in Venezuela rose about two-and-a-half-fold even as production fell by two-thirds, a pattern no unsanctioned neighbor shows, so environmental damage under sanctions is about two and a half times what a proportional decline in output would predict. Three channels generate this gap: the exit of small, dirty fields (composition) is more than offset by surviving fields running their infrastructure past design capacity (strain) and cutting their operating budgets (maintenance). We identify strain from the response of satellite-measured methane to the world price of naphtha, the imported diluent Venezuela's extra-heavy crude requires, and maintenance from a November 2022 U.S. Treasury license that allowed only Chevron to resume operations at its Venezuelan fields. A similar pattern of rising per-barrel emissions despite falling output appears under the sanctions on Iran (after 2018). |
| JEL: | F51 L71 Q35 Q53 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35512 |
| By: | Olivier de Bandt, David Nefzi, Johannes-Gabriel Werner |
| Abstract: | This paper investigates whether supervisory climate stress tests change how euro-area banks price and allocate credit according to borrowers’ transition risk. We combine loan-level data from the Eurosystem’s AnaCredit database with a firm-level measure of greenhouse-gas (GHG) intensity and compare banks subject to the ECB’s 2021-22 climate stress test with non-participating banks. A difference-in-differences-in-slopes design estimates whether the sensitivity of new-loan spreads to carbon intensity changed after the exercise. The average shift in this spread-intensity relationship is small and statistically insignificant. However, decomposing the aggregate effect reveals economically meaningful and offsetting adjustments. Participating banks reallocate new credit away from more carbon-intensive incumbent borrowers, while applying more carbon-sensitive pricing to relationships that enter or exit their portfolios; for new borrowers, a one-standard-deviation increase in carbon intensity is associated with about 10 basis points higher spreads. By contrast, repricing within continuing bank-firm relationships remains limited. The effects are strongest among the most carbon-intensive firms, and participation in the more demanding bottom-up module does not generate a clearly additional response. Overall, climate stress tests appear to operate mainly through portfolio recomposition and extensive-margin pricing, consistent with an information-and-supervisory-scrutiny channel rather than a broad repricing of existing loans. |
| Keywords: | Banking, Climate Stress Tests, Transition Risk, Credit Register, Loan Pricing, Carbon Intensity |
| JEL: | C23 E51 E58 G21 G28 G32 Q54 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:bfr:banfra:1059 |
| By: | Mahmoud Fatouh (Bank of England); Benjamin Guin (Bank of England); Haluk Unal (University of Maryland) |
| Abstract: | We study product innovation in the UK mortgage market by analysing when and how attributes outside the traditional structure of mortgage contracts become pricing relevant. To do so, we develop a stylised framework that treats mortgage products as structured bundles of attributes, focusing on the two-part tariff, comprising interest rates and fees, to infer innovation from pricing patterns. Our empirical strategy first uses transaction-level data and exploits within-product variations over time to detect when new product features affect pricing, which we apply to the case of green mortgages. Matching Energy Performance Certificates (EPCs) to UK mortgage originations, we show that EPCs become pricing-relevant in 2018, with lenders starting to offer pricing discounts for loans to buy properties with higher energy efficiency. We also use offer-level data on advertised green products to precisely estimate pricing discounts. We detect considerable green discounts, which reach up to 15 basis points in 2022. Mortgages against high EPC properties are concentrated in new buildings, suggesting relaxed credit constraints and increased housing investment, with implications for the broader economy. |
| Keywords: | Product innovation;green mortgages;housing construction;economic growth |
| JEL: | G21 O31 R31 |
| Date: | 2026–01–16 |
| URL: | https://d.repec.org/n?u=RePEc:boe:boeewp:023289 |
| By: | Wiwattanakornwong, Kunakorn; Eamphoo, Monthian; Saetang, Kanticha; Srichaiwongyot, Pattarawet; Matpang, Paerphon |
| Abstract: | This study examines Thailand’s strategic pathway toward low-carbon agricultural logistics by analyzing the sector’s structural characteristics, operational constraints, technological readiness, and policy conditions. The findings show that Thailand’s agricultural logistics system remains highly dependent on road freight, which accounts for more than 80.75% of total domestic freight movement, while agricultural logistics represents the largest freight category at 41.7% of total transport volume. Although this structure supports flexibility and broad market access, it also reinforces a carbon-intensive logistics pattern. The system remains deeply locked into fossil fuel dependence, as more than 77% of the truck fleet relies on diesel, and new truck registrations continue to rise by approximately 70, 000 units annually. While this structure provides flexibility and extensive market access, it also generates a carbon-intensive logistics pattern and limits progress toward more sustainable freight systems. The analysis further reveals that the transition is confronted by multiple challenges, including vehicle-related emissions, persistent modal imbalance, limited readiness for low-emission freight technologies, underutilized supply chain efficiency measures, and fragmented policy implementation collectively constrain the development of low-carbon agricultural logistics. In response, the study proposes a five-pillar strategic framework consisting of direct road freight decarbonization, gradual modal rebalancing, targeted technological readiness support, system-wide green supply chain improvement, and integrated governance. The study argues that low-carbon agricultural logistics should be treated not merely as an environmental issue, but as a strategic development agenda linking freight reform, infrastructure modernization, institutional coordination, and long-term competitiveness. These findings contribute to policy discussions on sustainable freight transition and provide practical implications for strengthening Thailand’s agricultural logistics system in line with climate and development goals. |
| Keywords: | Environmental Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:nccc26:409066 |
| By: | Giovanni Covi (Bank of England); Maren Froemel (Bank of England); Dennis Reinhardt (Bank of England); Nora Wegner (Bank of England) |
| Abstract: | How do banks respond to transition risk and which mechanisms drive this response? We shed new light on this question using data on granular international large exposures of UK banks. Climate policy is the main source of transition risk we use. We find that an increase in climate policy stringency on average leads to a decline in the share of lending that is exposed to transition risk. However, this finding is not uniform across banks: banks with a lower initial exposure to transition risk decrease their transition-risk exposure by more and increase their transition-aligned exposure, while banks with a high initial exposure to transition risk further increase their exposure to those sectors. We also find evidence supportive of outward international spillovers through banks' cross-border lending portfolios: banks increase transition risk-exposed lending to a given country if climate regulation gets tighter in other countries banks have such exposures to. |
| Keywords: | Transition risks;climate policy;large exposures;capital flows |
| JEL: | F42 G11 G21 G38 |
| Date: | 2025–10–31 |
| URL: | https://d.repec.org/n?u=RePEc:boe:boeewp:023271 |
| By: | Janusz Bialek |
| Keywords: | Power system blackouts, security of supply, Iberian blackout 2025 |
| JEL: | L94 L98 Q40 Q48 Q42 |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:enp:wpaper:eprg2619 |
| By: | Grugni, Elisa; Bazzana, Davide; Guerini, Mattia |
| Abstract: | Carbon farming comprises land-use practices that enhance carbon sequestration and reduce greenhouse gas emissions while improving soil quality and long-term agricultural sustainability. Despite its potential as a naturebased solution to climate change, its large-scale adoption is hindered by high upfront costs, monitoring challenges, and carbon permanence risks. This paper develops an agent-based model to study the adoption dynamics of carbon farming under alternative policy designs. Farmers allocate land across different agricultural practices, including conventional farming, crop rotation, and afforestation, each characterized by distinct economic and environmental implications. The model is used as a laboratory to study the agricultural transition under different incentive mechanisms: action-based subsidies, result-based payments linked to carbon sequestration, and hybrid mechanisms. Simulation results highlight important trade-offs. Action-based subsidies promote rapid adoption but may increase policy costs and threaten food production. Result-based schemes ensure economic sustainability but generate weaker environmental improvements. The paper provides policy-relevant insights into how incentive design shapes the diffusion and effectiveness of carbon farming, contributing to the debate on climate policy within the EU agricultural sector. |
| Keywords: | Climate Change, Environmental Economics and Policy, Land Economics/Use, Resource/Energy Economics and Policy, Sustainability |
| Date: | 2026–09–01 |
| URL: | https://d.repec.org/n?u=RePEc:ags:feemwp:410239 |
| By: | John A. List; Matthias Rodemeier; Sutanuka Roy; Gregory K. Sun |
| Abstract: | Behavioral interventions have become central to modern public policy, but their empirical promise remains contested because estimated treatment effects often appear small. We argue that a policy response is economically meaningful only relative to the response generated by alternative policies. We assemble more than 1, 200 estimates from over 600 studies comparing “nudges” and traditional price interventions in the markets for cigarettes, alcohol, influenza vaccination, electricity, and residential water. Translating nudge effects into equivalent price changes, we find that behavioral interventions often correspond to enormous fiscal interventions, from an 11% tax on electricity to a 100% subsidy on influenza vaccinations. Nudges are also more cost-effective than price instruments in all markets, but cost-effectiveness does not predict the welfare ranking of policies. Using a behavioral extension of the Marginal Value of Public Funds, we show that nudges have high welfare returns at the margin, while price instruments often generate larger total surplus at scale. |
| JEL: | D61 D83 H21 I12 I18 Q41 Q48 |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:nbr:nberwo:35567 |
| By: | Boss, Ruchira; Hoddinott, John; Colen, Liesbeth |
| Abstract: | Clean cooking policies are often promoted as a way to improve women’s welfare by reducing time spent cooking. Yet it remains unclear whether a shift to liquefied petroleum gas (LPG), and its sustained use, translates into meaningful reductions in women’s cooking time, or whether it instead reshapes how households prepare food. Using household survey data from Indigenous communities in Nagaland, India, this paper examines clean fuel transitions in a remote and under-studied region where firewood use and boiling-based cooking practices remain culturally embedded. We analyse these relationships through the lens of women’s occupational roles, recognising that differences in work schedules, flexibility, and income stability may influence LPG adoption and LPG use intensity. We find that women in salaried and self-employed occupations use LPG significantly more intensively than farmers and homemakers. Instrumental variable estimates show no robust evidence that exclusive LPG use reduces total cooking time. Instead, LPG use is associated with higher edible oil consumption, suggesting that clean fuel transitions may reshape food preparation practices rather than reduce cooking duration. These findings challenge the assumption that clean cooking benefits women primarily through time savings and highlight the importance of women’s livelihoods and local food contexts in shaping household energy transitions and their implications for diets, nutrition and well-being. |
| Keywords: | Agricultural and Food Policy, Consumer/Household Economics, Food Consumption/Nutrition/Food Safety, Labor and Human Capital |
| Date: | 2026–08–19 |
| URL: | https://d.repec.org/n?u=RePEc:ags:gausfs:410237 |
| By: | Huiying Ye; Richard S. J. Tol; Fangzhi Wang |
| Abstract: | Artificial intelligence (AI) interacts with climate in various ways, while a unified analytical framework of this intricate interplay is lacking. To align AI investment with climate policy, we propose such a framework integrating AI's impact on emissions, output, and climate damages into the DICE model. We distinguish between ICT-like and Industrial Revolution (IR)-like AI prospects. Calibrated to the best available evidence, we find that AI development is net polluting. Under current low abatement, ICT-like AI adds 0.1 degree C to 2100 warming, while IR-like AI adds 0.8 degree C. The associated climate costs offset roughly one-fifth and one-quarter of AI's economic gains, respectively. Meeting the 2 degree C target saves the optimal ICT(IR)-like AI investment rate by 2100 from 3.3% (5.1%) under the low-abatement scenario to 3.7% (12.7%), indicating that mitigation is complementary to AI development. We further show that the investment trade-off between AI and abatement is driven primarily by AI's economic prospects, not by its emissions footprint. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.24670 |
| By: | Banerjee, Anwesha; Barbieri, Stefano; Konrad, Kai A. |
| Abstract: | Global systematic economic shocks may affect the Nash equilibrium contributions to international climate mitigation. We study how this effect depends on the flexibility countries have to adjust to these shocks. The kind of rigidities countries face because of technological irreversibilities plays a crucial role. Under the plausible assumption of “prudence, †higher global uncertainty tends to reduce equilibrium climate contributions if irreversibilities in the level of climate policy choices exist. And, if countries are committed to allocating a proportion of income to climate protection, rigidities may increase welfare. Thus, exercising the option to perfectly adjust one’s contributions to shocks may be another form of free riding. |
| Keywords: | Global warming; Climate Protection |
| JEL: | Q54 H41 Q55 |
| Date: | 2024–07 |
| URL: | https://d.repec.org/n?u=RePEc:cpr:ceprdp:19283 |
| By: | Brüggemann, Anke; Grewenig, Elisabeth; Rode, Johannes; Schwartz, Michael |
| Abstract: | Climate investment in the business sector in Germany fell by just under 8% in real terms to EUR 80 billion in 2024. This is one of the findings of the 2025 KfW Climate Barometer. The decline in investment was driven by large enterprises. Compared with the previous year, they reduced their climate investments by 18.5% on an inflation-adjusted basis. The difficult global economic environment, growing international competitive pressure and changed priorities likely put the brakes on large enterprises’ climate commitments. SMEs, on the other hand, expanded their total investment in climate action last year (+7.8% in real terms). The survey shows that economic and financial aspects as well as lengthy approval procedures continue to pose the most urgent barriers to companies’ investments in climate-related measures. Businesses’ main plea to policymakers is to lower electricity prices to support climate investment. |
| Date: | 2025–12–15 |
| URL: | https://d.repec.org/n?u=RePEc:dar:wpaper:161625 |
| By: | Hu, Chenyang 'Nate'; Chen, Zhenshan |
| Keywords: | Resource /Energy Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404735 |
| By: | Benjamin E. Radoc, Jr. (Bangko Sentral ng Pilipinas); Karl Robert L. Jandoc (University of the Philippines School of Economics); Majah-Leah V. Ravago (Ateneo de Manila University) |
| Abstract: | Past studies reveal that forward markets reduce prices and mitigate market power. However, these results are conditional on the ability of sellers to leverage arbitrage opportunities in spot (real-time) and forward (period-ahead) markets. To investigate this further, we conducted a laboratory experiment to examine the impact of alternative forward market microstructures on the market for a non-storable commodity (i.e., electricity). Contrary to the standard theoretical prediction that forward markets narrow price differentials across stages, offer and clearing prices are persistently higher in the period-ahead stage in a market for a non-storable commodity. Among the forward market microstructures considered in this study, short selling yields the highest offered quantities (as a proportion of capacity) and the lowest average prices. Forward markets with dominant players reinforced higher clearing prices and disproportionately increased earnings of dominant participants. Overall, our findings suggest that forward markets, while potentially stabilizing prices and expanding trading opportunities, do not necessarily guarantee pro-competitive or welfare-improving outcomes in a market for a non-storable commodity like electricity. |
| JEL: | D22 D47 L11 |
| Date: | 2025–12 |
| URL: | https://d.repec.org/n?u=RePEc:bhd:dpaper:202520 |
| By: | Joan Christine S. Allon-Pineda (Bangko Sentral ng Pilipinas); Eduard Renzo D. Santos (Bangko Sentral ng Pilipinas) |
| Abstract: | Successive supply shocks led to above-target inflation for the Philippines from 2021 to 2023. Formulating the optimal policy response to bring inflation back to target requires central banks to have estimates of the direct and indirect pass through of supply shocks to domestic inflation. We estimate the direct and second round effects of shocks to global oil, global food, and domestic rice prices on various measures of inflation as well as inflation expectations using local projections methodology. In addition, we examine the asymmetry in the pass-through of price increases vis-Ã -vis a price reductions. Global oil and food price shocks produce significant and persistent inflationary responses that trigger further second-round effects and a significant but lagged impact on month-ahead inflation expectations. Decomposing realized inflation, the impact of global oil shocks has historically been larger than food shocks. Second-round effects from oil shocks are larger than its direct effects, while the latter is larger for global food and domestic price shocks. This is consistent with the role of oil as an intermediate good, which is in contrast with both food and rice which are considered final commodities. Assessing the asymmetry of shocks, headline and core inflation were found to respond asymmetrically to oil price shocks, although the effect does not persist for more than a month. Policymakers must continue to monitor the emergence of second-round effects and ensure that inflation expectations are well-anchored, especially during large, positive oil and food price shocks. |
| JEL: | E31 E37 C32 C36 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:bhd:dpaper:202506 |
| By: | Hong Lee (Korea Institute for Industrial Economics and Trade) |
| Abstract: | This study analyzes the paradoxical mechanism by which one country’s protectionist industrial policy unintentionally redirects the path of technological innovation in its trading partners, often to the supplying country’s own disadvantage. Historical episodes, including the OPEC oil shock, the Soviet Union’s threats to natural gas supplies to the West, China’s rare earth embargo against Japan, and US semiconductor export controls against China, share a common pattern.<p> First, the supplying country restricts exports of the resources and technologies it holds, or manipulates their prices, inflicting a supply shock on the importing country. The relative price of the resource then surges, dramatically raising the incentives of firms and researchers in the importing country to develop substitute and workaround technologies. Private R&D combines with the government’s directed industrial policy (R&D subsidies, public procurement, and regulatory reform) to bring substitute technologies quickly to market.<p> Over the long run, the importing country’s dependence on the resource declines, and the supplying country’s bargaining power and market position erode. This study argues that a supply restriction strategy raises short-term bargaining power but can carry a self-defeating quality, eating away the supplier’s own market base. For the importing country, by contrast, a supply shock can become the occasion for a technological leap, and here the government’s directed industrial policies, R&D subsidies among them, act as complements that accelerate private innovation. |
| Keywords: | rare earths; rare earth elements; REEs; directed technological change; DTC; protectionism; industrial policy; supply chain security; resource weaponization; economic security |
| JEL: | F13 F52 L52 O33 |
| Date: | 2026–07–31 |
| URL: | https://d.repec.org/n?u=RePEc:ris:kietrp:023560 |
| By: | Omid Oshriyeh (University of South Carolina [Columbia]); Ercan Sirakaya-Turk; Yuksel Ekinci |
| Abstract: | Many tourists support sustainability, but sustainable tourism markets are not homogeneous. This paper reports the results of a study on whether sustainability values can be used to segment UK tourists and whether the resulting segments differ in global warming concern and stated willingness to pay for carbon offsets. Survey data were collected from 560 UK tourists at four locations. Sustainability-value domains were first identified and then used to classify respondents into value-based segments. The analysis retained four domains: respect for nature, social equity and solidarity, tolerance, and shared responsibility. Two interpretable segments were identified. Tourists in the higher-sustainability-values segment reported stronger global warming concern and greater willingness to pay for carbon offsets than tourists in the moderate segment. However, willingness to pay was not universal even among tourists with stronger sustainability values. The findings suggest that values-based segmentation can help identify more receptive audiences for carbon-offset initiatives, but values-based targeting should be supported by credible, transparent, and easy-to-evaluate offset schemes. |
| Abstract: | De nombreux touristes soutiennent la durabilité, mais les marchés du tourisme durable ne sont pas homogènes. Cet article présente les résultats d'une étude visant à déterminer si les valeurs de durabilité peuvent être utilisées pour segmenter les touristes britanniques et si les segments qui en résultent diffèrent en termes de préoccupation face au réchauffement climatique et de disposition déclarée à payer pour des compensations carbone. Des données d'enquête ont été recueillies auprès de 560 touristes britanniques dans quatre lieux. Les domaines des valeurs de durabilité ont d'abord été identifiés, puis utilisés pour classer les répondants en segments fondés sur les valeurs. L'analyse a retenu quatre domaines : le respect de la nature, l'équité sociale et la solidarité, la tolérance et la responsabilité partagée. Deux segments interprétables ont été identifiés. Les touristes du segment aux valeurs de durabilité les plus élevées ont signalé une préoccupation plus marquée pour le réchauffement climatique et une plus grande disposition à payer pour des compensations carbone que les touristes du segment modéré. Cependant, la disposition à payer n'était pas universelle, même parmi les touristes ayant des valeurs de durabilité plus fortes. Ces résultats suggèrent que la segmentation fondée sur les valeurs peut aider à identifier des publics plus récepteurs pour les initiatives de compensation carbone, mais que le ciblage basé sur les valeurs doit être soutenu par des programmes de compensation crédibles, transparents et faciles à évaluer. |
| Keywords: | climate change, United States, United Kingdom, Travel, tourism, pro-environmental behavior, carbon offsetting, market segmentation, sustainable tourism, sustainability values |
| Date: | 2026–07–28 |
| URL: | https://d.repec.org/n?u=RePEc:hal:journl:hal-05706292 |
| By: | Giulo Cifarelli |
| Abstract: | We employ Logistic Smooth Transition (LSTAR) copulas with GARCH margins to investigate the transmission of dependence across major financial assets and two key benchmark commodities. Our analysis first examines the remarkably resilient role of gold as a hedging and safe-haven asset and compares its performance with that of WTI crude oil futures as an alternative strategic commodity. The proposed estimation framework provides a flexible approach to modelling time-varying dependence structures, avoiding arbitrary assumptions regarding the identification of contagion episodes or the definition of extreme market movements. The superior fit of the Gaussian copula specifications suggests that gold occupies a central position in the transmission of information across financial markets. Surprisingly, however, crude oil appears to outperform gold as a risk-hedging instrument during periods of heightened uncertainty, offering more effective downside protection in crisis episodes across three major markets. Another particularly robust finding concerns the dominant role of the CBOE VIX Index as the transition variable within the LSTAR framework. International sources of financial turbulence seem to affect dependence structures primarily when transmitted through the U.S. equity market, highlighting both the pivotal role of U.S. financial markets in the global financial system and their function as a conduit through which economically relevant information is assimilated and propagated by market participants. |
| Keywords: | Standard Essential Patents, Licensing Level, Automotive Industry, SEP regulation, TTBER |
| JEL: | G10 G11 G14 G15 |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:frz:wpaper:wp2026_14.rdf |
| By: | Schmid, Katrin; Schöneberg, Katharina |
| Abstract: | Die Branchenanalyse untersucht die Beschäftigungs- und Arbeitsbedingungen der deutschen Luft- und Raumfahrtindustrie vor dem Hintergrund eines starken Auftragswachstums und eines massiven Stellenaufbaus der letzten Jahre. Analysiert werden Umsatz- und Beschäftigtendaten, Auftragsentwicklung, Produktions- und Lieferkettenengpässe, die Rolle wachsender Rüstungsausgaben, Digitalisierung und KI, Anforderungen an "grünes Fliegen" sowie Qualifikationsbedarfe, Onboarding und Arbeitsbelastungen. Basis sind dabei amtliche Statistiken, Branchenpublikationen und 15 leitfadengestützte Interviews mit Betriebsräten, Management und Verbandsvertreter:innen. Daraus werden Handlungsfelder für Arbeitnehmervertretungen abgeleitet. |
| Keywords: | Airbus, Boeing, Renewable Energy, Directive II, Grünes Fliegen, Klima VII |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:zbw:hbsfof:342521 |
| By: | Harold Glenn A. Valera (Bangko Sentral ng Pilipinas); Mark J. Holmes (University of Waikato); Vic K. Delloro (Bangko Sentral ng Pilipinas) |
| Abstract: | In this paper, we address the challenge of using aggregate data to study the effects of fuel and rice prices on overall inflation in emerging markets. Our quantile regression analysis using the Philippines' province-level monthly data from 1996 to 2024 finds a strong impact during periods of higher inflation. Indeed, this impact is verified in Indonesia, Thailand, and India. We also find that inflation targeting and rice tariffication reduce such an impact and that high-poverty and rice-deficit areas exhibit a higher fall in rice inflation effect post-tariffication. In addition, the impact of remittances on Philippine inflation is nonlinear, while it is asymmetric for the other three countries. |
| JEL: | E31 E52 C32 |
| Date: | 2025–04 |
| URL: | https://d.repec.org/n?u=RePEc:bhd:dpaper:202502 |
| By: | Niko Hauzenberger; Michael Pfarrhofer |
| Abstract: | We develop fast methods for conditional forecasting and structural scenario analysis with high-dimensional Bayesian vector autoregressions (VARs). Our general framework features a factor structure on the reduced-form errors, which enables fast and order-invariant equation-by-equation estimation; suitably identified factors admit a structural interpretation. The scenarios are defined through separate distributional restrictions on observables, structural shocks and idiosyncratic components. The computational cost of our proposed algorithm is cubic only in the number of restrictions, while the dimension of the forecasted system enters linearly. In our application with $33$ macroeconomic and financial variables and ten set-identified structural shocks for the US, we compute counterfactual predictions for oil price scenarios in the context of the 2026 closure of the Strait of Hormuz. The same oil price path is consistent with outcomes ranging from a mostly benign episode to pronounced stagflation, depending on which structural and idiosyncratic shocks are allowed to deliver it. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2607.29215 |
| By: | Zheng, Yanan; Adamowicz, Vic; Qiu, Feng |
| Keywords: | Resource /Energy Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404746 |
| By: | Carlos L. Vega (University of East Anglia, School of Economics); Jestoni A. Olivo (Economics Office, Philippine Competition Commission); Antonio Miguel S. Ventura (Economics Office, Philippine Competition Commission); Eirene Gillian M. Reyes (University of the Philippines College of Law) |
| Abstract: | Change ownership reforms for electric cooperatives (ECs) have once again attracted policymakers’ interest due to current efforts in expediting their privatization. This note serves as input to this ongoing conversation using the lens of competition. We argue that unchecked consolidation - especially vertical integration along the power supply chain from generation to distribution - may cause more pernicious effects on the industry and welfare than existing inefficiencies of ECs. Consistent with Canlas & Jandoc (2025), we support a franchise competition regime where the threat of displacement may foster an overall competitive behavior among existing and potential players. The necessary conditions for and the challenges to implementing an effective competition for the market framework are determined. |
| Keywords: | market imperfections; legal monopolies; regulation or deregulation; electric utilities |
| JEL: | D43 L43 L94 |
| Date: | 2025–08 |
| URL: | https://d.repec.org/n?u=RePEc:phs:dpaper:202504 |
| By: | Jorrit Gosens; Alex B. H. Turnbull; Frank Jotzo |
| Abstract: | There is renewed attention for maritime chokepoints and their potential disruption of global trade in energy. We analyse global trade in coal, and find that it is highly resilient to maritime chokepoints. Feasible chokepoints do not truly sever any supply from the seaborne market. Potential re-routing of trade flows, and switching to alternative suppliers or consumers moderates effects on costs and revenues. We assess costs to importers would rise by as little as 0.5 \$/t or less in case of closures of most feasible chokepoints. The exception is a restriction to maritime traffic in the South and East China Sea, which could raise costs by 10 \$/t for China, whilst reducing costs for other importers in the region by similar levels. Maritime chokepoints do create geographical separation of regional markets, and therefore do not have a globally uniform effect on costs to importers and revenues to exporters. |
| Date: | 2026–07 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.00328 |
| By: | Haofeng Liao; Xing Wang |
| Abstract: | This paper develops an econometric framework for analysing smooth structural change in cointegrated systems following a known intervention time. We consider a vector error-correction model in which the cointegration rank and the pre-intervention cointegrating structure are identified from a stable pre-intervention subsample. After the intervention, both the adjustment coefficients and the cointegrating vectors are allowed to evolve smoothly as functions of rescaled time, which are estimated using kernel-weighted local reduced-rank methods. The analysis is formulated directly in a cointegrated VAR/VECM system, which preserves the treatment of long-run relations and short-run error-correction dynamics. By working with the decomposition $\Pi(\delta)=\alpha(\delta)\beta(\delta)'$, the method separates changes in the equilibrium relation from those in the speed of adjustment. We also provide two tests for the parameter consistency and the post-intervention parameter smoothness respectively. An empirical application to energy market, foreign-exchange, and gold-market index around the 24 February 2022 Russia's invasion of Ukraine illustrates how the proposed approach distinguishes between a discrete regime shift and smooth post-intervention evolution. The results suggest that cointegrating relation among the price of Brent crude oil, the spot exchange rate (USD/EUR), and the Credit Suisse NASDAQ Gold Price Index has smoothly changed after the outbreak of war, instead of a constant long-run conintegration system in the pre-intervention period. |
| Date: | 2026–08 |
| URL: | https://d.repec.org/n?u=RePEc:arx:papers:2608.03773 |
| By: | Dong, Yifan; Fei, Chengcheng; McCarl, Bruce |
| Keywords: | Resource /Energy Economics and Policy |
| Date: | 2026 |
| URL: | https://d.repec.org/n?u=RePEc:ags:aaea26:404788 |