|
on Environmental Economics |
| By: | Jaime de Melo (University of Geneva and FERDI) |
| Abstract: | The paper surveys the state of knowledge about the trade-related environmental consequences of a country’s development strategy along three channels: (i) direct trade-environment linkages (overexploitation of natural resources and trade-related transport costs);(ii) ‘virtual trade’ in emissions resulting from production activities; (iii) the product mix attributes of a ‘green-growth’ strategy (environmentally preferable products and goods for environmental management). Main conclusions are the following. Trade exacerbates over-exploitation of natural resources in weak institutional environments, but there is little evidence that differences in environmental policies across countries have led to significant ‘pollution havens’. Trade policies to ‘level the playing field’ would be ineffective and result in destructive conflicts in the WTO. Lack of progress at the Doha round suggests the need to modify the current system of global policy making. |
| Keywords: | Environmental Goods, Natural Resources, Green Growth, Trade and Climate |
| JEL: | F18 Q56 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2012.47&r=env |
| By: | Timilsina, Govinda R. |
| Abstract: | One key contentious issue in climate change negotiations is the huge difference in carbon dioxide (CO2) emissions per capita between more advanced industrialized countries and other nations. This paper analyzes the costs of reducing this gap. Simulations using a global computable general equilibrium model show that the average the carbon dioxide intensity of advanced industrialized countries would remain almost twice as high as the average for other countries in 2030, even if the former group adopted a heavy uniform carbon tax of $250/tCO2 that reduced their emissions by 57 percent from the baseline. Global emissions would fall only 18 percent, due to an increase in emissions in the other countries. This reduction may not be adequate to move toward 2050 emission levels that avoid dangerous climate change. The tax would reduce Annex I countries'gross domestic product by 2.4 percent, and global trade volume by 2 percent. The economic costs of the tax vary significantly across countries, with heavier burdens on fossil fuel intensive economies such as Russia, Australia, the United Kingdom and the United States. |
| Keywords: | Climate Change Mitigation and Green House Gases,Environment and Energy Efficiency,Climate Change Economics,Energy and Environment,Carbon Policy and Trading |
| Date: | 2012–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6115&r=env |
| By: | Benchekroun, H.; Ray Chaudhuri, A. (Tilburg University, Tilburg Law and Economics Center) |
| Abstract: | Abstract: This paper shows that, if countries are farsighted when deciding whether to defect from a coalition, then the implementation of cleaner technologies may jeopardize the chances of reaching an international environmental agreement. The grand coalition may be destabilized by the implementation of cleaner technologies, ultimately resulting in higher global emissions and lower global welfare. We further show that the higher the stock of pollution at the instant when the cleaner technology is implemented, the more likely that the above mechanism unfolds. We examine a reduction in the emission per output ratio as well as measures that enhance the natural rate of decay of stock pollutants. |
| Keywords: | transboundary pollution;renewable resource;clean technologies;coalition formation;differential games. |
| JEL: | Q20 Q54 Q55 Q58 C73 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:dgr:kubtil:2012021&r=env |
| By: | Matthew Ranson (Harvard University, Harvard Kennedy School); Robert N. Stavins (John F. Kennedy School of Government, Harvard University) |
| Abstract: | The outcome of the December 2011 United Nations climate negotiations in Durban, South Africa, provides an important new opportunity to move toward an international climate policy architecture that is capable of delivering broad international participation and significant global CO2 emissions reductions at reasonable cost. We evaluate one important component of potential climate policy architecture for the post-Durban era: links among independent tradable permit systems for greenhouse gases. Because linkage reduces the cost of achieving given targets, there is tremendous pressure to link existing and planned cap-and-trade systems, and in fact, a number of links already or will soon exist. We draw on recent political and economic experience with linkage to evaluate potential roles that linkage may play in post-Durban international climate policy, both in a near-term, de facto architecture of indirect links between regional, national, and sub-national cap-and-trade systems, and in longer-term, more comprehensive bottom-up architecture of direct links. Although linkage will certainly help to reduce long-term abatement costs, it may also serve as an effective mechanism for building institutional and political structure to support a future climate agreement. |
| Keywords: | Global Climate Change, Market-Based Instruments, Cap-and-Trade, Carbon Pricing, Carbon Taxes, Linkage, International Climate Policy Architecture |
| JEL: | Q54 Q58 Q40 Q48 |
| Date: | 2012–05 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2012.43&r=env |
| By: | William Shobe (University of Virginia); Dallas Burtraw (Resources for the Future) |
| Abstract: | Climate change policy analysis has focused almost exclusively on national policy and even on harmonizing climate policies across countries, implicitly assuming that the harmonization of climate policies at the subnational level would be mandated or guaranteed. We argue that the design and implementation of climate policy in a federal union will diverge in important ways from policy design in a unitary government. National climate policies built on the assumption of a unitary model of governance are unlikely to achieve the expected outcome due to interactions with policy choices made at the subnational level. In a federal system, the information and incentives generated by a national policy must pass through various levels of subnational fiscal and regulatory policy. Effective policy design must recognize both the constraints and opportunities presented by a federal structure of government. Furthermore, policies that take advantage of the federal structure of government can improve climate governance outcomes. |
| Keywords: | climate change, subsidiarity, states, federalism, climate governance |
| JEL: | Q54 Q58 H7 |
| Date: | 2012–01–18 |
| URL: | http://d.repec.org/n?u=RePEc:vac:wpaper:wp12-01&r=env |
| By: | Melania Michetti (Fondazione Eni Enrico Mattei (FEEM), Centro Euro-mediterraneo per i Cambiamenti Climatici (CMCC)) |
| Abstract: | The rapid development of climate policies and the need to understand the dynamics of climate change have highlighted and shaped the role of land use, land-use change and forestry dynamics (LULUCF), making it an issue of global importance. As a consequence, LULUCF has become a central topic in economic theory and in environmental sciences. The attention is focused on creating and expanding comprehensive global land-use datasets and on improving the modelling strategies allowing for an extensive representation of the land-use system. However, this is a relatively new research field and the development of this challenging process is likely to require greater effort in the years to come. By adopting a straightforward model classification, this paper provides a broad, but detailed, overview of the most representative methods and models developed to date. This summary will guide a critical discussion on relevant methodological aspects related to the global modelling of land use and its changes. An additional focus is placed on the representation of forest-carbon sequestration within climate mitigation, which represents one of the most demanding issues from a modelling perspective. |
| Keywords: | Land, Land-Use Change Modelling, Agriculture, Forestry |
| JEL: | Q23 Q24 Q51 Q54 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2012.46&r=env |
| By: | Hamilton, Kirk; Stover, Jana |
| Abstract: | Recent carbon market prices are substantially lower than mean or median estimates of the social cost of carbon in the literature. Intuition would therefore suggest that'investment errors'are being made, in the sense that markets favor higher carbon-emitting projects, while global welfare would be larger with lower carbon-emitting projects. This intuition is correct in specific circumstances, but not others. For any comparison of two alternative projects, there is a carbon switching price that equalizes their net social benefits. From the perspective of maximizing global welfare, investment errors only occur when this switching price lies between the carbon market price and the social cost of carbon. Data on the costs of high-carbon and low-carbon electric generation projects suggest that there is no financing gap using mean or median published figures, but for precautionary (95th percentile) choices of the social cost of carbon, there is a financing gap between carbon market prices and the switching price that would trigger investment in the global welfare-maximizing low-carbon project. A global carbon fund to finance this gap could be conceived, but stricter emission caps and reforms of carbon markets are likely to be a more efficient solution to the problem. |
| Keywords: | Climate Change Mitigation and Green House Gases,Climate Change Economics,Markets and Market Access,Carbon Policy and Trading,Energy Production and Transportation |
| Date: | 2012–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6117&r=env |
| By: | Kousky, Carolyn (Resources for the Future) |
| Abstract: | This paper reviews the empirical literature on the economic impacts of natural disasters to inform both climate adaptation policy and the estimation of potential climate damages. It covers papers that estimate the short- and long-run economic impacts of weather-related extreme events as well as studies regarding the determinants of the magnitude of those damages (including fatalities). The paper also includes a discussion of risk reduction options and the use of such measures as an adaptation strategy for predicted changes in extreme events with climate change. |
| Keywords: | natural disaster damages, climate adaptation, risk mitigation |
| JEL: | Q54 D1 E2 O1 |
| Date: | 2012–07–05 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-12-28&r=env |
| By: | Frank Jotzo |
| Abstract: | The inaugural Australia Carbon Pricing Survey elicits expectations about the future of carbon pricing from experts working for Australia's largest greenhouse gas emitting companies, the carbon finance and investment industry and selected other experts. The survey indicates pervasive uncertainty about the future of Australia's carbon pricing scheme, but also a strong expectation that carbon pricing will be a feature of Australia's economic policy framework in the medium to long term. 79% of respondents expect that there will be a carbon price in Australia in 2020. But 40% expect that the current scheme will be repealed by the end of 2016. Of those who expect repeal, almost half think that a carbon price will be re-instated by 2020. Factoring in expectations of a possible zero carbon price, the average expected effective Australian carbon price falls from its initial level of $23 per tonne of carbon dioxide equivalent to $10 to $11 per tonne during 2016-18, before climbing to $22 per tonne in 2025. Assessments vary greatly between respondents, illustrating the extent of policy uncertainty. Nevertheless, 69% of respondents from large carbon emitters indicate that their companies have cut emissions in anticipation of a carbon price, and 84% expect their company to do so over the next three years – not withstanding significant uncertainty about whether the carbon price may be repealed. The survey also covers expectations about future prices in the EU emissions trading scheme and credits under the Clean Development Mechanism, the Australian price floor and linking with the EU scheme, and the future of Australia's national emissions target. |
| Keywords: | Carbon pricing, emissions trading, public policy, expert survey, Australia |
| JEL: | Q52 Q54 Q58 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:een:ccepwp:1206&r=env |
| By: | Robert S. Pindyck |
| Abstract: | Climate policy poses a dilemma for environmental economists. The economic argument for stringent GHG abatement is far from clear. There is disagreement among both climate scientists and economists over the likelihood of alternative climate outcomes, over the nature and extent of the uncertainty over those outcomes, and over the framework that should be used to evaluate potential benefits from GHG abatement, including key policy parameters. I argue that the case for stringent abatement cannot be based on the kinds of modeling exercises that have permeated the literature, but instead must be based on the possibility of a catastrophic outcome. I discuss how an analysis that incorporates such an outcome might be conducted. |
| JEL: | D81 Q51 Q54 |
| Date: | 2012–07 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:18205&r=env |
| By: | Coretha Komba; Edwin Muchapondwa |
| Abstract: | In Sub-Saharan Africa, climate change is set to hit the agricultural sector the most and cause untold suffering particularly for smallholder farmers. To cushion themselves against the potential welfare losses, smallholder farmers need to recognize the changes already taking place in their climate and undertake appropriate investments towards adaptation. This study investigates whether smallholder farmers in Tanzania recognize climate change and consequently adapt to it in their agricultural activities. The study also investigates the factors influencing their choice of adaptation methods to climate change To do this, the study collected and analyzed data from 556 randomly selected households in a sample of districts representing the six agro-ecological regions of the country. The data shows that Tanzanian smallholder farmers have observed changes in mean and variance precipitation and temperature and responded to it The farmers have generally used shortseason crops, drought-resistant crops, irrigation, planting dates and tree planting to adapt to the potential negative impacts of climate change on their agricultural yields. A binary logit model is used to investigate the factors influencing a famer's decision to undertake any adaptation at all to climate change while a multinomial logit model is used to investigate the factors influencing farmers' choice of specific adaptation methods. The Tanzanian government needs to help smallholder farmers overcome constraints they face in taking up adaptation to climate change. Furthermore, the government can play a significant role by promoting adaptation methods appropriate for particular circumstances e.g. particular crops or agro-ecological zones |
| Keywords: | Adaptation methods, smallholder farmers, agro-ecological zones, climate change, Tanzania. |
| JEL: | Q10 Q12 Q51 Q54 Q57 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:rza:wpaper:299&r=env |
| By: | Thure Traber; Claudia Kemfert |
| Abstract: | The German decision to finally phase-out nuclear electricity has led to a debate on its effects on electricity prices, emission prices in the European emission trading system, as well as on international electricity trade. We investigate these effects with a Electricity market model for Europe with investments in power plants under oligopolistic conditions in Germany. We find modest price increases on the German wholesale market by the mid-term 2020 and an effect of the accelerated nuclear phase- out of between four and twelve percent. Moreover, the increase in the emission allowance prices due to the change in nuclear policy is between 1:8 and 3 Euro per ton of CO2 by the same period. The large variations in our results are induced by four combinations of the European emission trading policy and the success of the German energy efficiency policy. Most pronounced price effects are found in scenarios with a successful energy savings policy, which acts as a substitute for new power plants. Moreover, the tighter the emission trading system is, the larger are the effects of the accelerated phase-out on electricity and emission prices. Under a tight system, however, investments in conventional generation are likely to be dominated by natural gas fired plants since the decrease of utilization rates induced by renewable energies are more important for coal fired power plants with their relative high investment costs. |
| Keywords: | energy modeling; nuclear phase-out; climate policy; oligopoly |
| JEL: | C63 L13 L94 Q38 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwwpp:dp1219&r=env |
| By: | Adkins, Liwayway; Garbaccio, Richard; Ho, Mun (Resources for the Future); Moore, Eric; Morgenstern, Richard (Resources for the Future) |
| Abstract: | The effects of a carbon price on U.S. industries are likely to change over time as firms and customers gradually adjust to new prices. The effects will also depend on offsetting policies to compensate losers and the number of countries implementing comparable policies. We examine the effects of a $15/ton CO2 price, including Waxman-Markey-type allocations, on a disaggregated set of industries, over four time horizons—-the very-short-, short-, medium-, and long-runs—-distinguished by the ability of firms to raise output prices, change their input mix, and reallocate capital. We find that if firms cannot pass on higher costs, the loss in profits in a number of energy-intensive, trade-exposed (EITE) industries will be substantial. When output prices can rise to reflect higher energy costs, the reduction in profits is substantially smaller, and the offsetting policies in H.R. 2454 reduce output and profit losses even more. Over the medium- and long-terms, however, when more adjustments occur, the impact on output is more varied due to general equilibrium effects. We find that the use of the output-based rebates and other allocations in H.R. 2454 can substantially offset the output losses over all four time frames considered. Trade or "competitiveness" effects from the carbon price explain a significant portion of the fall in output for EITE sectors, but in absolute terms, the trade impacts are modest and can be reduced or even reversed with the subsidies. The subsidies are less effective, however, in preventing emissions leakage to countries not adopting carbon policies. Roughly half of U.S. trade-related leakage to non-policy countries can be explained by changes in the volume of trade and the other half by higher emissions intensities induced by lower world fuel prices. |
| Keywords: | carbon price, competitiveness, input-output analysis, computable general equilibrium models, output-based allocations, carbon leakage |
| JEL: | F14 D D57 D58 H23 |
| Date: | 2012–06–29 |
| URL: | http://d.repec.org/n?u=RePEc:rff:dpaper:dp-12-27&r=env |
| By: | James Roumasset (UHERO, University of Hawaii at Manoa); Christopher Wada (UHERO, University of Hawaii at Manoa) |
| Abstract: | We provide a synthesis of the economics of groundwater with a focus on optimal management and the Pearce equation for renewable resources. General management principles developed through the solution of a single aquifer optimization problem are extended to the management of multiple resources including additional groundwater aquifers, surface water, recycled wastewater, and upland watersheds. Given an abundant (albeit expensive) substitute, optimal management is sustainable in the long run. We also discuss the open-access equilibrium for groundwater and the conditions under which the Gisser-Sanchez effect (the result that the present value generated by competitive resource extraction and that generated by optimal control of groundwater are nearly identical) is valid. From the models and examples discussed, one can conclude that optimization across any number of dimensions (e.g. space, time, quality) is driven by a system shadow price, and augmenting groundwater with available alternatives lessens scarcity and increases welfare if timed appropriately. Other rules-of-thumb including historical cost recovery, independent management of separate aquifers, and maximum sustainable yield are inefficient and may involve large welfare losses. |
| Keywords: | Groundwater, renewable resources, dynamic optimization, sustainable yield, Pearce equation, marginal user cost, conjunctive use, water institutions, Gisser-Sanchez effect, governance |
| JEL: | Q20 Q25 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:hae:wpaper:2012-5&r=env |
| By: | Sango Mohanty (Crawford School of Public Policy, The Australian National University); Trung Dinh Dang (Crawford School of Public Policy, The Australian National University); Phing Giang Hai (Crawford School of Public Policy, The Australian National University) |
| Abstract: | The spontaneous growth of Vietnam's 2,790 rural craft villages has been a mixed blessing. Specialising in 'traditional' crafts such as processed foods, textiles and furniture, as well as newer commodities, such as recycled products, craft businesses have expanded rapidly since Vietnam adopted the 'Doi Moi' (economic renovation policy) in the mid-1980s. As with small scale rural industries in other developing countries, the expansion, modernisation and diversification of craft production in Vietnam presents significant development opportunities as well as environmental and social risks. This largely unregulated increase in industrial activity has reduced rural poverty and brought prosperity to rural entrepreneurs, but it has also generated dangerously high levels of pollution with attendant risks to human health. Since the 1990s, the Vietnamese government has developed several laws and initiatives to regulate industrial activities and control craft village pollution, such as the 'polluter pays principle'. However, the small scale and dispersed nature of craft production has continued to defy effective management by the state, and pollution levels in craft villages have increased alarmingly. The Crafting Sustainability project aimed to provide a better understanding of the drivers of pollution, and policy approaches to better addressing them. Drawing on four cases study sites in the Red River Delta region of Northern Vietnam, this paper provides an overview of key findings and policy recommendations. |
| JEL: | Q20 Q25 R50 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:een:devpol:1220&r=env |
| By: | Heather Klemick |
| Abstract: | Despite concerns about additionality, leakage, permanence, and verification, carbon offsets have been proposed as a core component of recent cap-and-trade proposals in order to contain costs, involve uncapped sectors in GHG reduction goals, and build mitigation capacity in developing countries. Discounting the value of offsets relative to GHG allowances (i.e., setting a trading ratio less than one) has been suggested as one approach to protect the integrity of the cap. This paper presents a simple theoretical model to derive the optimal trading ratio between offsets and allowances when coverage of emissions by the cap-and-trade and offsets programs is incomplete. I discuss the relationship between the trading ratio and the GHG cap and offsets baseline, which jointly determine the stringency of the policy. While a discount for leakage is always optimal, one notable result is that if “hot air” is introduced by setting either the baseline cap or the cap too leniently, an extra discount is warranted. |
| Keywords: | offsets, additionality, leakage, baseline, cap and trade, second-best theory |
| JEL: | D62 H23 Q54 Q58 |
| Date: | 2012–07 |
| URL: | http://d.repec.org/n?u=RePEc:nev:wpaper:wp201204&r=env |
| By: | Kerri Brick; Martine Visser |
| Abstract: | The lack of cooperation and prevalence of free riding in efforts to reduce emissions reflects the public good dilemma synonymous with climate change: whereby individual incentives lead to sub-optimal outcomes. This study examines how cooperative norms can be fostered through democratic processes. Specifically, we assess whether a given policy affects cooperation more significantly when it is democratically chosen by heterogeneous subjects as opposed to exogenously imposed by the experimenter. Subjects with differing marginal costs of abatement must democratically select an institution to reduce a national greenhouse gas inventory. By majority vote, subjects can choose between communication and two carbon tax variants. The experimental literature from studies with homogenous subjects suggests that cooperation improves when policy is endogenously selected as opposed to exogenously enforced. Overall we find that endogenous choice does not improve cooperation when subjects are heterogeneous. Furthermore, we find that, in the absence of a binding commitment, cooperation declines with endogenous choice as the prevalence of free-riding increases. |
| Keywords: | heterogeneity; voting; communication; public good |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:rza:wpaper:298&r=env |
| By: | Vagliasindi, Maria |
| Abstract: | This paper presents new global evidence on the key determinants of public-private partnership investment in electricity generated by fossil fuels and renewable energy based on a panel data analysis for 105 developing countries over a period of 16 years from 1993 to 2008. It aims to identify the key factors affecting private investors'decision to enter electricity generation, through probit analysis, and the amount of investment sunk in this market segment, based on Heckman's sample selection analysis. The paper shows some evidence of switching from investment in fossil fuels to investment in hydro and renewables and within fossil fuels from oil to natural gas. An interesting result of the econometric analysis is that the likelihood of switching toward renewable investment is driven by long-run environmental factors, such as the increases in the price of oil and the introduction of the Kyoto protocol. Another interesting result is that sector governance support schemes, provided by feed-in tariffs, affect only the entry in renewable based electricity generation and have no impact in reducing the amount of investment in fossil fuel based generation. Economy-wide governance factors, including control for corruption and degree of political competition, are factored in by private investors only in the initial stage of the game when the decision to enter into the generation market is taken and not the amount of investment. This confirms that the first generations of independent power producers have been developed on the basis of long-term power purchase agreements guaranteeing a fixed rate of return, through take-or-pay clauses and/or government guarantees. |
| Keywords: | Energy Production and Transportation,Energy Demand,Emerging Markets,Environment and Energy Efficiency,Energy and Environment |
| Date: | 2012–07–01 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:6118&r=env |
| By: | Debaere, Peter |
| Abstract: | Freshwater scarcity is bound to be a major challenge of the 21st century. Drawing on newly available data, I investigate to what extent countries make efficient use of the very uneven water resources on a global scale. In particular, I find that countries that are relatively water abundant tend to export more water-intensive products. This evidence supports the hypothesis that water is a source of comparative advantage. My findings also indicate that water contributes significantly less to the pattern of exports than the traditional production factors such as labor and physical capital. In light of climate change, this suggests relatively moderate disruptions to trade on a global scale due to changing precipitation patterns. My results do not provide consistent evidence that there is a difference in the extent to which water determines the pattern of trade between water-scarce and water-abundant countries. |
| Keywords: | Comparative Advantage; International Trade; Water |
| JEL: | F1 |
| Date: | 2012–07 |
| URL: | http://d.repec.org/n?u=RePEc:cpr:ceprdp:9030&r=env |
| By: | Valentina Bosetti (FEEM, Fondazione Eni Enrico Mattei, and CMCC Centro Euro-Mediterraneo per i Cambiamenti Climatici); Frédéric Ghersi (CIRED – Centre International de Recherche sur l’Environnement et le Développement) |
| Abstract: | In this paper we develop the standard utility function of a Ramsey-type optimal growth model to account for a ‘market-time’ vs. ‘free-time’ trade-off. To do so, we introduce a free-time preference coefficient that measures the utility gained by deviating from a maximum labour supply defined as the combination of a 95% labour force participation rate for the 20 to 69 year-old population, and 3000 annual working hours (50 effective 60-hour weeks). We calibrate this free-time preference coefficient for 12 world regions on statistical and projected data from the United Nations, the International Labour Organisation and the OECD. We illustrate a prospective use of this modelling development by comparing the consequences of convergence of the free-time preference coefficients of all world regions to the contrasted Western European vs. United States value. Over the 21st century, compared to a business-as-usual trajectory defined by maintained regional disparities in free time preference, convergence to US free time preference induces a 0.3% decrease in global discounted labour market time, but a 4.2% increase in discounted global GDP sustained by a 2.5% increase in primary energy consumption that translates into a 1.7% increase in cumulated CO2-equivalent emissions; convergence to Western European free time preference decreases labour market time by 13.8%, GDP by 11.7%, primary energy consumption by 10.7% and cumulated CO2-equivalent emissions by 9.1%. |
| Keywords: | Ramsey Growth Model, Endogenous Labour Supply. Utility of Leisure, Beyond GDP Welfare Valuation |
| JEL: | C0 O4 |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:fem:femwpa:2012.44&r=env |
| By: | Fridolfsson, Sven-Olof (Research Institute of Industrial Economics (IFN)); Tangerås, Thomas (Research Institute of Industrial Economics (IFN)) |
| Abstract: | Green certificates are the main instrument for promoting renewable electricity (RES-E) in Sweden. But certificates cover only a limited share of total RES-E production. Under partial coverage, crowding out may arise whereby costly new RES-E replaces inexpensive old RES-E. Granting certificates to all of RES-E production improves efficiency, but leaves windfall rent to otherwise profitable facilities. We also analyze transaction costs in the permit process for new RES-E in Sweden. Municipalities veto socially desirable projects because of asymmetrically distributed investment costs and benefits. We propose market-based permit fees rather than limited veto rights as a solution to this NIMBY problem. |
| Keywords: | Crowding out; Green certificates; NIMBY; Transaction costs; Windfall rent |
| JEL: | D23 Q48 Q52 Q54 |
| Date: | 2012–06–18 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:iuiwop:0921&r=env |
| By: | Fürsch, Michaela (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Nagl, Stephan (Energiewirtschaftliches Institut an der Universitaet zu Koeln); Lindenberger, Dietmar (Energiewirtschaftliches Institut an der Universitaet zu Koeln) |
| Abstract: | Electricity generation from renewable energy sources (RES-E) is supposed to increase signi ficantly within the coming decades. However, uncertainty about the progress of necessary infrastructure investments, public acceptance and cost developments of renewable energies renders the achievement of political plans uncertain. <p> Implementation risks of renewable energy targets are challenging for investment planning, because different RES-E shares fundamentally change the optimal mix of dispatchable power plants. Speci cally, uncertain future RES-E deployment paths induce uncertainty about the steepness of the residual load duration curve and the hourly residual load structure. <p> In this paper, we show how uncertain future RES-E penetrations impact the electricity system and try to quantify effects for the Central European power market. We use a multi-stage stochastic investment and dispatch model to analyze effects on investment choices, electricity generation and system costs. Our main findings include that the uncertain achievement of RES-E targets signi ficantly effects optimal investment decisions. <p> First, a higher share of technologies with a medium capital/operating cost ratio is cost-efficient. Second, the value of storage units in systems with high RES-E penetrations might decrease. Third, in the case of the Central European power market, costs induced by the implementation risk of renewable energies seem to be rather small compared to total system costs. |
| Keywords: | Multi-Stage Stochastic Programming; Renewable Energy; Power Plant Optimization |
| JEL: | C61 C63 Q40 |
| Date: | 2012–05–09 |
| URL: | http://d.repec.org/n?u=RePEc:ris:ewikln:2012_008&r=env |
| By: | Cannas, Rita |
| Abstract: | In the last decades, sustainable tourism models have become a key topic in the academic debate, as well as in policy makers’ strategies. Within the tourism industry, there is an emerging need to match the expectations of a new and consistent niche of tourists, who increasingly demand tourism accommodation facilities with ecological features. The arising of the eco-consumers keeps opening today economic opportunities for businesses. The paper analyses the economic and social feasibility of Craik, an ecovillage project in a remote area of Scotland, which aims to adopt sustainability practices in every aspect of its tourism facilities (e.g. low carbon building; use of green energy; wastewater treatment). The study is divided in three main parts: the first adopt a marketing perspective in order to investigate the demand and the supply of the international ecotourism market; the second analyses the market of high quality lodge accommodation in Scotland and the Borders; the third explores the potential outcomes of the project in terms of revenues, number of employees and partnerships with local businesses. The paper concludes that the Craik’s ecovillage project could represent a challenging opportunity to experiment with a new model of sustainable tourism accommodation in Scotland. However, final recommendations suggest the need to rethink the product in terms of ecolodge design, to provide high quality furnishing products and a detailed profile of potential customers, as well as the need to identify specific marketing strategies that could effectively match tourists’ expectations. |
| Keywords: | sustainable tourism feasibility study ecotourism market |
| JEL: | M31 L83 Q57 |
| Date: | 2012 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:39838&r=env |
| By: | Michael S. Michael and Panos Hatzipanayotou |
| Abstract: | This paper builds a small open economy trade model where there is pollution from the production and consumption of goods. In the presence of production and consumption pollution, we examine a piecemeal consumer-price-neutral reform of the tariff and consumption tax and a piecemeal producer-price-neutral reform of the export and production taxes on a specific good. The paper identifies sufficient conditions under which the above tax reforms improve welfare and increase government tax revenues. |
| Keywords: | Domestic and trade tax reforms, Production and consumption generated pollution, Government tax revenues, Welfare |
| Date: | 2012–06 |
| URL: | http://d.repec.org/n?u=RePEc:ucy:cypeua:11-2012&r=env |