|
on Regulation |
| By: | Francesco Nicolli (Facoltà di Economia (Faculty of Economics) - Università degli Studi di Ferrara); Francesco Vona (Facoltà di Economia (Faculty of Economics) - Università degli Studi di Ferrara) |
| Abstract: | This paper investigates empirically the effect of market regulation and renewable energy policies on innovation activity in different renewable energy technologies. For the EU countries and the years 1980 to 2007, we built a unique dataset containing information on patent production in eight different technologies, proxies of market regulation and technology-specific renewable energy policies. Our main findings show that lowering entry barriers is a more significant driver of renewable energy innovation than privatisation and unbundling, but its effect varies across technologies, being stronger in technologies characterised by the potential entry of small, independent power producers. Additionally, the inducement effect of renewable energy policies is heterogeneous and more pronounced for wind, which is the only technology that is mature and has high technological potential. Finally, the ratification of the Kyoto protocol – determining a more stable and less uncertain policy framework - amplifies the inducement effect of both energy policy and market liberalisation. |
| Date: | 2014–07 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-01087864&r=reg |
| By: | Claudio Marcantonini; Vanessa Valero |
| Abstract: | In order to combat global warming, Italy has committed to clear environmental goals by reducing its CO2 emissions. To this purpose, it has notably encouraged renewable energy development through a variety of support schemes, ranging from green certificates to feed-in and premium tariffs. As a result, during the last years, the production of electricity from renewable energy sources, especially from wind and solar energy, has experienced a considerable surge. In this paper we estimate the cost of reducing CO2 emissions in the power sector by deploying wind and solar energy in Italy from 2008 to 2011. The results show that, for the period analyzed, the average costs for wind are in the order of 150 €/tCO2, while for solar are much higher, above 1000 €/tCO2. This is because solar energy generators receive much higher remunerations per MWh of generated electricity than wind energy generators. These costs are about twice as high as in Germany. This is due to the difference between the incentive schemes and the power system in the two countries. |
| Keywords: | Abatement Cost, Renewable Energy, Wind Energy, Solar Energy, Italy |
| Date: | 2015–03 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2015/20&r=reg |
| By: | Charlotte von Möllendorff; Heinz Welsch |
| Abstract: | Electricity from renewable sources avoids disadvantages of conventional power generation but often meets with local resistance due to visual, acoustic, and odor nuisance. We use representative panel data on the subjective well-being of 46,678 individuals in Germany, 1994-2012, for identifying and valuing the local externalities from solar, wind and biomass plants in respondents’ postcode area and adjacent postcode areas. We find significant well-being externalities of all three technologies that differ with regard to their temporal and spatial characteristics. The monetary equivalent of 1 MW capacity expansion is estimated to be in the range of 0.3-0.7 percent of per capita income. |
| Keywords: | renewable energy, local externality, subjective well-being, life satisfaction, non-market valuation |
| JEL: | Q42 D62 I31 Q51 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:diw:diwsop:diw_sp779&r=reg |
| By: | J. Micha Steinhäuser; Klaus Eisenack (University of Oldenburg, Department of Economics) |
| Abstract: | Strongly correlated and spatially concentrated curtailment of power plants strongly affects the electricity market. Such curtailment is observed during heat waves in middle Europe, for example. First, curtailed power plants need to be substituted by more expensive ones. Second, additional congestion of the electricity grid may constrain substitution. These consequences and their spatial incidence have yet not been thoroughly assessed at the level of a national electricity system. Does congestion excessively amplifes curtailment costs? Do costs remain localized? How does the cost incidence depend on the market design? We employ a calibrated DC load <br>flow model of the German electricity system that simulates an energy-only market followed by redispatch, as well as nodal prices, for a representative week and renewable feed-in scenarios. We find that spatially concentrated curtailment by 10% of Germany's installed non-renewable generation capacity leads to a 3% welfare loss of the market value, but that loss is not driven by congestion. The electricity price rises by 14% in average, and up to 17% in peak load hours. Consumers bear the burden of curtailment, whereas producer gain in the aggregate. Effects considerably spill over to other regions. While consumers in Southern Germany always lose, consumers<br>in Eastern and Western Germany may gain welfare. Nodal pricing reduces loss by up to 1.5%, and shifts a larger burden to consumers and to Southern Germany. The aggregated economic effects of curtailment are manageable in Germany, but its distributional effects are multiple times larger. |
| Keywords: | climate change; distribution; energy-only market; Germany; heat wave; loop-ows; market design; nodal prices; renewables; surplus |
| JEL: | D39 Q41 Q54 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:old:dpaper:379&r=reg |
| By: | Grainger,Corbett Alden; Zhang,Fan; Schreiber,Andrew William |
| Abstract: | Subsidies and cross-subsidies in the energy sector are common throughout Eastern Europe and Central Asia. In Belarus, revenues from an industrial tariff on electricity are used to cross-subsidize heating for households. Input-output (IO) data and a household consumption survey are used to analyze the distributional impacts of this cross-subsidization. This paper illustrates cost shares and electricity-intensity of different sectors and consumption categories and uses the IO data to obtain first-order estimates of the distributional incidence of policy reform. The paper then analyzes distributional impacts of subsidy reform with a Computable General Equilibrium model. Although poorer households benefit from reduced heating costs, the increase in prices of other consumer goods due to higher electricity prices more than offsets the benefits they receive from the subsidies. The analysis finds that the current cross-subsidies are regressive, and policy reform would be highly progressive. |
| Keywords: | Transport Economics Policy&Planning,Energy Production and Transportation,Economic Theory&Research,Emerging Markets,Markets and Market Access |
| Date: | 2015–08–06 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:7385&r=reg |
| By: | Denny Ellerman; Vanessa Valero; Aleksandar Zaklan |
| Abstract: | The existence of some 2 billion unused EU Allowances (EUAs) at the end of Phase II of the EU's Emissions Trading System (EU ETS) has sparked considerable debate about structural shortcomings of the EU ETS. At the same time, there has been a surprising lack of interest in one possible explanation of this accumulation of EUAs: the theory of intertemporal permit trading, i.e. allowance banking. In this paper we adapt basic banking theory to the case of a smoothly declining cap such as that in the EU ETS. We show that it is rational for agents to decrease emissions beyond the constraint imposed by the cap initially, accumulating an allowance bank and then drawing it down in the interest of minimizing abatement cost over time. Having laid out the theory, we carry out a set of simulations for a reasonable range of key parameters, calibrated to the EU ETS, to illustrate the e_ects of intertemporal optimization of abatement decisions on optimal time paths of emissions and allowance prices. We also explore the e_ect of an unexpected change in counterfactual emissions. We conclude that bank accumulation as the result of intertemporal abatement cost optimization should be considered at least a partial explanation when evaluating the current discrepancy between the cap and observed emissions in the EU ETS. |
| Keywords: | Cap and Trade System, EU ETS, Intertemporal Trading. |
| JEL: | D92 F18 Q54 |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:rsc:rsceui:2015/29&r=reg |
| By: | Silberberger, Magdalena |
| Abstract: | The role of regulatory quality as one of the so-called deep determinants of growth has emerged as an important issue in economic research in the past 20 years. The positive or negative growth effects of a country´s regulatory framework are amplified by economic integration, which makes factors and producers more mobile and enables them to avoid burdensome regulation. Therefore, the two potential determinants to growth might be interlinked. So far there is very little empirical evidence on the impact of the regulatory framework in an integrated economy on growth. We deal with the most common problems in estimating growth equations by using internal instruments to identify a causal relationship between regulation and growth in the presence of international trade and find evidence that both regulation and trade have a significant positive influence on growth, with the effect of regulation being especially pronounced for countries that have worse regulatory quality and for middle-income countries. |
| Keywords: | institution,integration,regulation,openness,trade,growth |
| JEL: | F11 F43 |
| Date: | 2015 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:cegedp:255&r=reg |
| By: | Christoph Böhringer (University of Oldenburg, Department of Economics); Xaquín Garcia-Muros (Basque Centre for Climate Change, Bilbao, Spain); Mikel Gonzalez-Eguino (Basque Centre for Climate Change, Bilbao, Spain); Luis Rey (Basque Country (UPV-EHU), Bilbao, Spain) |
| Abstract: | Intensity standards have gained substantial momentum as a regulatory instrument in US climate policy. Based on numerical simulations with a large-scale computable general equilibrium model we show that intensity standards may rather increase than decrease counterproductive carbon leakage. Moreover, standards can lead to considerable welfare losses compared to emission pricing via carbon taxation or an emissions trading system. The tradability of standards across industries is a mechanism that can reduce these negative effects. |
| Keywords: | Unilateral climate policy; carbon leakage, intensity sstandard, computable general equilibrium |
| JEL: | D21 H23 D58 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:old:dpaper:384&r=reg |
| By: | Catherine Locatelli (équipe EDDEN - PACTE - Politiques publiques, ACtion politique, TErritoires - CNRS - Grenoble 2 UPMF - Université Pierre Mendès France - IEPG - Sciences Po Grenoble - Institut d'études politiques de Grenoble - Grenoble 1 UJF - Université Joseph Fourier) |
| Abstract: | Gas security is a key factor in the European Union's energy policy. Contractual relations based on long-term contracts during the 1970s and 1980s led to relative stability in energy trade between the EU and its gas suppliers. But since the mid-1990s, the process of opening up the EU's gas industries to competition and the desire to create a single gas market has led to an in-depth reorganization of the sector. The EU now intends to redefine the way in which it manages its relations with its main suppliers, such as Russia, by attempting to impose a model based on competition, unbundling of network industries and privatization. Russia does not intend to implement this "EU model" in its gas sector, despite the big changes taking place in its domestic market. An approach based on the preferential use of state instruments conflicts with the multilateralism and principles of competition upheld by the EU. The EU's normative power is thus in contradiction with the institutional environment of the Russian energy sector. It is therefore unlikely that energy relations between the EU and Russia will be structured solely on standards stemming from international rules and institutions. |
| Date: | 2015–04 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-01131203&r=reg |
| By: | García-Valiñas, Maria A.; Gonzales, Francisco; Suarez, Javier; Zaporozhets, Vera |
| Abstract: | Water services management has become a key issue as urban water supply is considered a service of general interest in the European Union (EU, 2001). In this context, public-private partnerships (PPP) have emerged as a usual way of local water services provision. This paper contributes to analyze the effects and consequences of PPP in the management of water resources. First of all, we develop a theoretical framework to show the effects of water services contracting-out on water prices. Second, we estimate the model using a sample of Spanish municipal water services recently privatized. Our findings support that, in a context of limited resources, local governments are using public-private partnerships in order to get additional fundings to reduce their indebt- ness levels. Moreover, the fact of setting a high reservation price as a way to guarantee a minimum amount of resources has had consequences in terms of water price increases after water services privatization. |
| Keywords: | Water services, Public-private partnerships, Auctioning, Game theory, Water prices |
| JEL: | L33 L95 Q25 |
| Date: | 2015–07 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:29542&r=reg |
| By: | Whittington,Jan; Lynch,Catherine |
| Abstract: | Global trajectories for reducing carbon emissions depend on the local adoption of alternatives to conventional energy sources, technologies, and urban development. Yet, decisions on which type of capital investments to make, made by local governments as part of the normal budget cycle, typically do not incorporate climate considerations. Furthermore, current academic and professional literature specific to climate change draws attention to decision-making tools that would require access to technical expertise, data, and financial support that may not be practical for cities in low- and middle-income countries. Arguably, the methodologies most able to effect this transformation will be those that are convenient and affordable to administer, and that offer straight-forward low carbon alternatives to traditional forms of infrastructure investment. Current methodologies for capital investment planning that do not take climate change into consideration can result in prioritization of investments that diverge from a low carbon path and a potential missed opportunity to reap financial benefits from efficiency gains. This paper concludes that relatively minor alterations to common procedures can reveal the trade-offs and local benefits of low carbon alternatives in the capital investment planning process. This paper was written as an input to the preparation of the Climate-Informed Capital Investment Planning Guidebook, a how-to guide for local government staff, which will be published in 2015. |
| Date: | 2015–07–29 |
| URL: | http://d.repec.org/n?u=RePEc:wbk:wbrwps:7381&r=reg |