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on Energy Economics |
| By: | Laure-Anne Plumhans |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:clr:mwugar:212&r=all |
| By: | Doina Maria Radulescu; Philippe Sulger |
| Abstract: | Many economies are concerned with the future security of electricity supply. This is rooted in the necessity to decarbonise energy systems and in the nuclear phase-out. Hence, some economies, instead of investing in own domestic energy capacity, rely on energy production by their neighbours. At the same time, countries claim to drastically cut back their fossil fuel energy production. Yet, they increasingly depend on fossil fuel energy imports from abroad. To analyse these interdependencies we employ data for 17 European countries from 1978 to 2017. We first examine how countries respond to changes in energy capacity investment by countries in the vicinity. Using spatial econometric models we find a negative relationship between countries’ investment in energy capacities. Second, we use fixed effects and instrumental variable estimators as well as an event study framework to analyse the link between domestic fossil energy production and imports. Our results reveal that a decline in domestic fossil energy production is associated with increasing fossil energy imports, suggesting that countries partially substitute one for the other. |
| Keywords: | security of energy provision, spatial models, energy imports |
| JEL: | C21 H54 H77 Q41 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8896&r=all |
| By: | Constanze Fettnig |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:clr:mwugar:214&r=all |
| By: | Simshauser, P. |
| Abstract: | Australia’s National Electricity Market operates in one of the world’s longest and stringiest transmission networks. The 2016-2020 investment supercycle, in which 13,000 MW of renewables were committed, is slowly revealing the limits of network hosting capacity for renewable plant. In this article, side-effects arising from the supercycle are analysed. The majority sources of renewable investment failure relate to deteriorating system strength, viz. associated connection lags, remediation and curtailment costs. Although a multi-zonal market, the NEMs locational investment signals remain visibly strong. A change to nodal arrangements may refine dispatch efficiency but the bigger policy problem is rapidly diminishing network hosting capacity for new renewables, imperfect regulation and regulatory lag associated with augmentation. Markets participants seek to move faster than regulatory frameworks allow. Renewable Energy Zones (REZ) are examined through both i). a consumer-funded regulatory model and ii). a renewable generator-funded market model. A ‘super-sized concessional mezzanine’ facility is presented as a critical element of REZ capital funding. It forms the means by which to optimise market-based REZ transmission augmentation and moderate sponsor risks of transient underutilisation. |
| Keywords: | Electricity, Renewable Energy Zones, transmission investment, locational investment signals |
| JEL: | D25 D80 G32 L51 Q41 |
| Date: | 2021–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2119&r=all |
| By: | Mohammad Aldubyan; Moncef Krarti; Eric Williams (King Abdullah Petroleum Studies and Research Center) |
| Abstract: | This paper describes the development of the Residential Energy Model (REEM) for Saudi Arabia using an engineering bottom-up approach. The model can assess energy demand for the current residential building stock and the impact of energy efficiency and demand-side management programs. It accounts for the makeup and features of the Kingdom’s existing housing stock using 54 prototypes of residential buildings defined by three building types, three vintages, and six locations representing different climatic zones. |
| Keywords: | Energy Efficiency, Energy Modeling, Residental building stock, Demand side management |
| Date: | 2021–02–21 |
| URL: | http://d.repec.org/n?u=RePEc:prc:mpaper:ks--2020-mp05&r=all |
| By: | Andor, Mark Andreas; Gerster, Andreas; Peters, Jörg |
| Abstract: | This paper evaluates an intervention that randomized information letters about energy efficient investments and behaviors among 120,000 customers of two utilities in Germany. We find that conservation effects differ considerably between both utilities, ranging from a precisely estimated zero effect to 1.4%. By contrast, we do not detect significant framing effects from presenting savings in monetary or ecological terms. Based on random causal forest methods, we show that the effect heterogeneity across utilities cannot be explained by socio-demographic characteristics. Our results demonstrate the importance of site-specific factors for the effectiveness of information campaigns, which has crucial implications for targeting and the ability to infer population-wide effect sizes from pilot studies. |
| Keywords: | Imperfect information,information letters,behavioral public economics,energy efficiency,energy conservation,non-price interventions,targeting |
| JEL: | D12 D83 L94 Q41 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:871&r=all |
| By: | Md. Main Uddin; Liang Choon Wang; Russell Smyth |
| Abstract: | We conduct an Online randomized controlled experiment in Australia in order to examine whether government initiatives to encourage the use of energy comparison sites increase consumer search and result in lower prices. Despite significant price variations across energy retailers, our experiment indicates that while providing information about the potential gains from using the governmentowned Victoria Energy Compare (VEC) website encourages participants to visit the website, it is not effective in inducing them to contact, or switch, retailers who are providing better offers. Moreover, the availability of a $50 bonus associated with using the VEC website reduces the likelihood that lowincome participants contact, or switch retailers, in order to lower their electricity prices, leading to an increase in their electricity expenditure. Our findings imply that government-initiated comparison sites are not sufficient to promote competition and that providing consumers with financial incentives for using these sites in order to encourage competition may potentially backfire. |
| Keywords: | VEC, Financial incentive, Energy price, Field experiment, Australia |
| JEL: | H24 H31 Q43 Q48 |
| Date: | 2020–12 |
| URL: | http://d.repec.org/n?u=RePEc:mos:moswps:2020-11&r=all |
| By: | Guojun He (Division of Social Science, Division of Environment and Sustainability, Department of Economics, The Hong Kong University of Science and Technology.); Takanao Tanaka (Division of Social Science, The Hong Kong University of Science and Technology.) |
| Abstract: | Following the Fukushima nuclear accident, Japan gradually shut down all its nuclear power plants, causing a country-wide power shortage. In response, the government launched large-scale campaigns that aimed to reduce summer electricity consumption by as much as 15% in some regions. Because electricity use plays a key role in mitigating climate impacts, such policies could potentially damage the population’s health. Exploiting the different electricity- saving targets set by different regions, we show that the reduction in electricity consumption indeed increased heat-related mortality, particularly during extremely hot days. This unintended consequence suggests that there exists a trade-off between climate adaptation and energy saving. |
| Keywords: | Electricity Saving, Climate Change Adaptation, Fukushima Accident, Extreme Weather |
| JEL: | Q48 Q54 O12 I1 |
| Date: | 2019–09 |
| URL: | http://d.repec.org/n?u=RePEc:hku:wpaper:201967&r=all |
| By: | John Szabo (Institute of World Economics, Centre for Economic and Regional Studies) |
| Keywords: | EU; natural gas; transition fuel; climate policy; energy transition |
| JEL: | F50 Q34 Q48 |
| Date: | 2020–09 |
| URL: | http://d.repec.org/n?u=RePEc:iwe:workpr:262&r=all |
| By: | Mads Greaker (Oslo Business School - OsloMet) |
| Abstract: | Electric vehicles (EVs) and their associated charging stations are characterized by indirect network effects. Indirect network effects may imply too slow adoption of a new good that improves welfare. Today, there are at four standards for high-speed charging in Europe. We find that policies should seek to standardize high-speed charging systems as this will unambiguously mean faster phase-in of EVs and improve welfare. We also find that governments should subsidize both the charging at each station and the entry of charging stations. The subsidies should cover a share of the private variable charging cost and the private fixed entry cost. Furthermore, the formula for setting the shares of costs to be paid by the regulator turns out to be very simple; the regulator only has to observe the percentage markup on the charging price, and can calculate the optimal share directly from that. |
| Keywords: | EV policy, indirect network effects, EV charging |
| Date: | 2020–10–30 |
| URL: | http://d.repec.org/n?u=RePEc:oml:wpaper:202003&r=all |
| By: | Francesco Lamperti; Valentina Bosetti; Andrea Roventini; Massimo Tavoni; Tania Treibich |
| Abstract: | Which policies can increase the resilience of the financial system to climate risks? Recent evidence on the significant impacts of climate change and natural disasters on firms, banks and other financial institutions call for a prompt policy response. In this paper, we employ a macro-financial agent- based model to study the interaction between climate change, credit and economic dynamics and test a mix of policy interventions. We first show that financial constraints exacerbate the impact of climate shocks on the economy while, at the same time, climate damages to firms make the banking sector more prone to crises. We find that credit provision can both increase firms' productivity and their financial fragility, with such a trade-off being exacerbated by the effects of climate change. We then test a set of 'green' finance policies addressing these risks, while fostering climate change mitigation: i) green Basel-type capital requirements, ii) green public guarantees to credit, and iii) carbon-risk adjustment in credit ratings. All the three policies reduce carbon emissions and the resulting climate impacts, though moderately. However, their effects on financial and real dynamics is not straightforwardly positive. Some combinations of policies fuel credit booms, exacerbating financial instability and increasing public debt. We show that the combination of all three policies leads to a virtuous cycle of (mild) emission reductions, stable financial sector and high economic growth. Additional tools would be needed to fully adapt to climate change. Hence, our results point to the need to complement financial policies cooling down climate-related risks with mitigation policies curbing emissions from real economic activities. |
| Keywords: | Climate change; endogenous growth; financial stability; macroprudential policy; agent-based model. |
| Date: | 2021–02–21 |
| URL: | http://d.repec.org/n?u=RePEc:ssa:lemwps:2021/05&r=all |
| By: | Packham, Natalie |
| Abstract: | Recently, a number of structured funds have emerged as public-private partnerships with the intent of promoting investment in renewable energy in emerging markets. These funds seek to attract institutional investors by tranching the asset pool and issuing senior notes with a high credit quality. Financing of renewable energy (RE) projects is achieved via two channels: small RE projects are financed indirectly through local banks that draw loans from the fund’s assets, whereas large RE projects are directly financed from the fund. In a bottom-up Gaussian copula framework, we examine the diversification properties and RE exposure of the senior tranche. To this end, we introduce the LH++ model, which combines a homogeneous infinitely granular loan portfolio with a finite number of large loans. Using expected tranche percentage notional (which takes a similar role as the default probability of a loan), tranche prices and tranche sensitivities in RE loans, we analyse the risk profile of the senior tranche. We show how the mix of indirect and direct RE investments in the asset pool affects the sensitivity of the senior tranche to RE investments and how to balance a desired sensitivity with a target credit quality and target tranche size. |
| Keywords: | Renewable energy financing,structured finance,CDO pricing,LH++ model |
| JEL: | C61 G13 G32 |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:irtgdp:2020003&r=all |
| By: | Anna Katharina Keil |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:clr:mwugar:213&r=all |
| By: | Kurani, Kenneth S. |
| Abstract: | Advocates of electric, shared, and automated vehicles (e-SAVs) envision a future in which people no longer need to drive their privately owned, petroleum-fueled vehicles. Instead, for daily travel they rely on fleets of electric, automated vehicles that offer travel services, including the option to share, or “pool,” rides with strangers. The design, deployment, and operation of e-SAVs will require widespread willingness of users to share with strangers vehicles that are capable of fully automated driving. To achieve the environmental and societal goals of e-SAVs it is critical to first understand and address safety and security concerns of potential and actual users. Researchers at the University of California, Davis, reviewed the literature to understand potential users’ perceptions of safety and security risks posed by intertwined social and technical systems of e-SAVs and proposed a framework to advance research, policy, and system design. This policy brief summarizes the findings of that work and provides policy implications. View the NCST Project Webpage |
| Keywords: | Social and Behavioral Sciences, Autonomous vehicles, Car pooling (Railroads), Electric vehicles, Literature reviews, Public opinion, Risk taking, Safety and security, Shared mobility, Vehicle sharing |
| Date: | 2021–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsdav:qt4qq6s5t6&r=all |
| By: | Delucchi, Mark A |
| Abstract: | In order to assess the state of knowledge of the private and social lifetime cost (LC) of conventional and alternative-powertrain vehicles (mainly electric vehicles), we reviewed and evaluated 190 LC studies published between 2000 and 2020. Our main objective was to determine which aspects of the LC of motor vehicles were well researched and well analyzed, and which aspects were less well researched and analyzed and accordingly would benefit most from a focused new research effort. In general, few studies are comprehensive (cover all components of the LC), original (as opposed to reliant on other work), and detailed (as opposed to being based on simple assumptions). A spreadsheet accompanying this report evaluates all of the studies. |
| Keywords: | Engineering, Social and Behavioral Sciences, cost-benefit anlaysis, total cost of vehicle ownership, social lifetime cost of advanced vehicles, literature review |
| Date: | 2021–02–01 |
| URL: | http://d.repec.org/n?u=RePEc:cdl:itsrrp:qt8dq1b82q&r=all |
| By: | Sommer, Stephan; Vance, Colin |
| Abstract: | Drawing on panel data from Germany, this paper estimates the relationship between charging infrastructure and the uptake of electric vehicles (EVs). We specify models with fixed effects and instrumental variables to gauge the robustness of our findings in the face of alternative channels through which endogeneity bias may emerge. We find that charging infrastructure has a statistically significant and positive impact on EV uptake, with the magnitude of the estimate increasing with population density. The evidence further suggests that although the incidence of charging points in Germany far exceeds the European Union's recommended minimum ratio of one point to ten EVs, inadequate infrastructure coverage remains a binding constraint on EV uptake. We use the model estimates to illustrate the relative cost effectiveness of normal and fast chargers by region, which supports a geographically differentiated targeting of subsidies. |
| Keywords: | Transport policy,electric vehicles,charging infrastructure,Germany |
| JEL: | H54 H71 Q58 R40 R58 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:893&r=all |
| By: | Atkinson, Giles; Hamilton, Kirk |
| Abstract: | Exhaustible resources and the revenues they generate present a number of broad problems for macroeconomic management. For example, tax revenues can be large and highly volatile, and the stream of revenues is finite. An increasing number of countries now view resource funds and/or fiscal rules for resource revenues as the answer to these challenges. In this paper, we explore the consequences for the UK if past revenues arising from the depletion of subsoil assets had been channelled into a sovereign wealth fund. We show that had a decision been made to establish such a fund in 1975, this could have been substantial in size by 2018 (about GBP 354 billion) and, moreover, would have had a number of benefits such as a reduction in volatility of resource revenues flowing to the Treasury. Crucially, the fund’s value would have substantially boosted the size of the government balance sheet, yielding corresponding fiscal benefits. We argue this missed opportunity is underlined further by considering the current debate about shale gas development in the UK. Notwithstanding considerable un- certainties, favourable and optimistic projections for key parameters are required for any shale-based fund to match what we simulate based on past experience for conventional subsoil assets. |
| Keywords: | sustainability; resource depletion; sovereign wealth funds |
| JEL: | E6 R14 J01 |
| Date: | 2020–04–01 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:103564&r=all |
| By: | Regina Seri (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA [2017-2020] - Université Clermont Auvergne [2017-2020] - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | This paper sheds light on the effects of giant discoveries of natural resources (oil natural gas, minerals) on sovereign debt ratings in the short and long run. To do so, it employs 28 developing and emerging countries over the period 1990-2014 and applies a random effect ordered Probit model on different sets of samples. It shows evidence of the differentiated effects (positive and negative) of giant discoveries on ratings. These differentiated effects are linked to the behavior of macroeconomic and political indicators resulting from the actions and policies taken in the aftermath of the discoveries. It also finds evidence of the learning effects of giant discoveries in countries with increasing sovereign debt ratings. What seems to matter is not only the resources but also how governments respond to the news of the discovery of those resources. Therefore, taking the right actions and policies will help countries to prevent a deterioration of their financial conditions. |
| Keywords: | Giant discoveries,Natural resources,Sovereign debt ratings,Developing countries,Random effect ordered response models |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03144330&r=all |
| By: | Gavard, Claire; Schoch, Niklas |
| Abstract: | In the framework of the Paris Agreement implementation, financial transfers remain a major point of negotiation for addressing equity concerns raised by the ambitious climate objectives. In complement to the theoretical, experimental and numerical studies that have examined the role of transfers in facilitating coalitions, we conduct the first empirical analysis of their impact on national carbon emission reductions. We build on the existing literature to develop a conceptual framework which models continuous national emission choices in the presence of financial transfers. We infer an equation of the impact of mitigation and adaptation finance on national emissions of recipient countries. We test the derived hypothesis using carbon emissions data of non-OECD countries in the last 20 years. We find that public adaptation and mitigation finance tend to increase emissions. Private mitigation finance seems to reduce them only after five years following the transfers. |
| Keywords: | International environmental agreements,public goods,transfers,climate finance,emission reductions,adaptation,climate policy |
| JEL: | C23 C70 D02 K33 Q54 Q58 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:21014&r=all |
| By: | Guy Meunier; Jean-Pierre Ponssard |
| Abstract: | We assume that a project requires an initial outlay and may either succeed or fail. The probability of success depends on its type and on the effort of the firm. Only in the case of success do private and external benefits appear. The paper analyzes the optimal design of subsidies under different information structures the state agency and the firm may have over the characteristics of the project. It is proved that under symmetric information structures rewarding success is optimal while, ordinarily, under asymmetric ones, rewarding failure is optimal. While reward success encourages effort, rewarding failure mitigates windfall profit. In asymmetric structures, the second feature dominates. These results emphasize the crucial significance of properly identifying the underlying structure in designing an efficient incentive scheme. The policy relevance of our analysis is discussed in the context of risky programs such as those for the energy transition associated with COVID recovery plans. |
| Keywords: | green innovation, public financing, information structure, conditional schemes |
| JEL: | O38 D25 D82 H25 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8881&r=all |
| By: | Eric Jondeau; Benoit Mojon; Cyril Monnet |
| Abstract: | The momentum toward greening the economy implies transition risks that are new threats to financial stability. In particular, the expectation that other investors may exclude high carbon corporate emitters from their portfolio creates a risk of runs on brown assets. We show that runs can be contained by a liquidity backstop with an access fee that is based on the firm's carbon intensity, while the interest rate on the liquidity lent through this facility is independent from its carbon intensity. |
| Keywords: | green finance, financial stability, bank runs, brown assets, liquidity provision |
| JEL: | G01 G18 G28 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:bis:biswps:929&r=all |
| By: | Kanay, Ayşegül; Hilton, Denis; Charalambides, Laetitia; Corrégé, Jean-Baptiste; Inaudi, Eva; Waroquier, Laurent; Cezera, Stéphane |
| Abstract: | We compared the effectiveness of basket goal-setting to product information strategies on sustainable consumption in a simulated online supermarket. Experiment 1 found a significant effect of basket goal setting techniques with carbon basket feedback in either numerical or graphical form on the carbon content of baskets purchased but no effect of numerical product information alone or in combination with basket CO2 information. Experiment 2 also found that basket goal setting was effective, but found no additional effect of introducing five-colour coding of the carbon footprints of either products or baskets. Experiment 3 replicated the effects of goal setting and found that repeated visits to the online supermarket led to improved learning about product carbon footprint in the basket goal setting condition. Our results suggest that goal setting techniques with feedback can reduce the carbon footprint of online shopping baskets and facilitate learning about product carbon footprint. |
| Keywords: | Sustainable consumption; Goal-setting; Decision-aiding; Carbon labels; Groceries |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:125315&r=all |
| By: | Amarendra Sahoo (European Commission - JRC); Ignacio Perez Dominguez (European Commission - JRC); Sarah Mubareka (European Commission - JRC); Giulia Fiorese (European Commission - JRC); Giacomo Grassi (European Commission - JRC); Roberto Pilli (European Commission - JRC); Mihaly Himics (European Commission - JRC); Viorel Blujdea (European Commission - JRC); Marco Follador (European Commission - JRC); Frederik Neuwahl (European Commission - JRC); Raffaele Salvucci (European Commission - JRC); Mate Rozsai (European Commission - JRC); Peter Witzke (EuroCare GmbH, Bonn (Germany)); Monika Kesting (EuroCare GmbH, Bonn (Germany)) |
| Abstract: | This report is an attempt to develop a modelling framework integrating different sectoral stand-alone models used at the JRC for policy impact assessment in the fields of agriculture, forestry, land use change and energy. The proposed quantitative framework should improve the capability of assessing greenhouse gas emissions and removals resulting from complex interactions between the agriculture, forestry, and other land use (AFOLU) sectors, and facilitate the analysis of policy scenarios relevant for a sustainable and carbon-neutral European economy. Four models are considered, for which a revised model specification and harmonization of relevant databases and model parameters is needed. The Common Agricultural Policy Regionalized Impact (CAPRI) Modelling System is a widely used large-scale multi-commodity agricultural economic model. The Land Use-based Integrated Sustainability Assessment modelling platform for BioEconomy and Ecosystem Services (LUISA-BEES) is primarily used for the ex-ante evaluation of European policies that have a direct or indirect territorial impact on the agricultural and forestry sectors. The Carbon Budget Model (CBM) is a stand-alone forestry model that simulates forest carbon dynamics. The Policy Oriented Tool for Energy and Climate Change Impact Assessment (POTEnCIA) model depicts a detailed EU energy system combining both techno-economic modules. As a 'proof of integration', this report describes the improvement of the CAPRI land use function and harmonization of related database such as to be linked to the output from the LUISA-BEES model. Moreover, forestry area projections and related carbon removals in CAPRI are improved by using direct information from the CBM model. Last but not least, the POTEnCIA model is improved by parameterizing a first generation biofuel supply curve based on CAPRI simulations. In order to test the proposed modelling framework, the report proposes a set of exploratory policy scenarios based on each model’s capabilities: reform of the Common Agricultural Policy, expansion of biofuel mandates and carbon pricing (CAPRI); implementation of spatially explicit sustainability criteria for the plantation of energy crops and afforestation (LUISA-BEES), different levels of forest harvesting (CBM) and strong decarbonisation policies (POTEnCIA). |
| Keywords: | AFOLU, Integrated Framework, Agriculture, Forestry, Land Use Change, Energy, CAPRI, LUISA-BEES, CBM and POTENCIA |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:ipt:iptwpa:jrc123172&r=all |
| By: | Manisha Jain (Indira Gandhi Institute of Development Research) |
| Abstract: | Recent studies analyzing India's decarbonisation efforts using external data do not confirm the achievements stated in India's country reports submitted to the United Nations Framework Convention on Climate Convention. The role of economic structure changes compared to energy intensity in driving India's carbon dioxide emissions also differs across studies using different data sources. In this paper the difference in the country-reported data and the data published by International Energy Agency (IEA) is studied, and its implications on India's progress in meeting its mitigation goals are examined. This study finds that the main difference between the two data sources is the estimates of emissions from the manufacturing and construction sectors. As per country data, India's carbon dioxide emission intensity of industrial production during 2007-14 has declined by 7. However, as per IEA data, it has increased by 10. The country data shows that sector-level energy intensity effect has put downward pressure on emissions in this period. However, the IEA data shows that only the structural changes in the economy have pushed India's carbon dioxide emissions downwards in 2007-14. These findings have implications on the effectiveness of India's mitigation strategies in promoting energy-efficient technologies, particularly in industrial production. |
| Keywords: | Decarbonization, CO2 emissions intensity, decomposition analysis, Log Mean Divisia Index, industrial energy efficiency |
| JEL: | Q48 Q58 |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:ind:igiwpp:2021-007&r=all |
| By: | Fett, Daniel; Fraunholz, Christoph; Keles, Dogan |
| Abstract: | Cost reductions of rooftop photovoltaics and battery storage, increasing retail electricity prices as well as falling feed-in remuneration provide strong incentives for many German households to engage in self-consumption. These developments may also affect the electricity system as a whole. Against this background, we jointly apply a prosumer simulation and an agent-based electricity market simulation in order to investigate the long-term impacts of a residential battery storage diffusion on the electricity market. We analyze different regulatory frameworks and find significant effects on the household level, yet only moderate system impacts. In the long run, the diffusion of residential battery storage seems difficult to govern, even under a restrictive regulation. In contrast, the way the batteries are operated may be easier to regulate. Policymakers and regulators should focus on this aspect, since a system-friendly battery operation supports the system integration of residential photovoltaics while having little impact on the households' selfsufficiency. |
| Keywords: | Self-consumption,Battery storage,Technology diffusion,Electricity system,Agent-based simulation,Model coupling |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:kitiip:55&r=all |
| By: | Adwoa Asantewaa, Adwoa; Jamasb, Tooraj; Llorca, Manuel |
| Abstract: | TSince the late 1980s, electricity sector reforms have transformed the structure and organisation of the sector in many countries across the world. While the outcomes of reforms in developed and some developing countries have been extensively examined, there is limited analysis on the outcomes of the reforms in sub-Saharan Africa (SSA). This paper analyses the performance of electricity sector reforms in 37 SSA countries between 2000 and 2017. We use a Stochastic Frontier Analysis approach to estimate a multi-input-multi-output distance function to assess the impact of reform steps and institutional features on sector-level performance. The results indicate that reforms in SSA increased the installed generation capacity per capita and plant load factor but did not reduce technical network losses. Also, the presence of an electricity law, sector regulator, vertical unbundling, and private participation in the management of assets have a positive impact on reform performance. Perceptions of non-violent institutional features such as corruption, regulatory quality and governance effectiveness do not seem to have significant effect on reform performance, but perceptions of political stability, violence and terrorism influence reform outcomes. The effects of hydroelectric capacity on reform performance was found to be negligible while larger electricity systems were found to be more efficient reformers. We conclude that a workable reform in SSA involves vertical unbundling with an electricity law, a regulator and private ownership and management of assets where desirable. However, the positive outcomes go hand in hand with an increase of technical network losses, and hence emphasis should be placed on decoupling these losses from generation capacity and plant load factor. |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:oeg:wpaper:2021/02&r=all |
| By: | Antoine GODIN; Louison CAHEN-FOUROT; Emanuele CAMPIGLIO; Eric KEMP-BENEDICT; Stefan TRSEK |
| Abstract: | The aim of this article is to assess the exposure of economic systems to the risk of physical capital stranding following a reduction of fossil fuel production and use. We calculate crosssectoral and cross-country ‘marginal stranding multipliers’ for 43 regions, and study how supply-side capital stranding might propagate via international production networks. We show how the fossil industry has the potential of creating significant stranding cascades affecting downstream sectors and the economic system as a whole. We then focus on crosscountry stranding impacts and rank countries according to their external stranding potential and to their exposure to external stranding risk. Finally, we analyse more in depth the origins and transmission channels of the stranding links affecting the most exposed countries (US, China and Germany). Our results confirm the relevance of including multi-regional production networks and physical capital stranding into the ongoing effort to assess the macro-financial implications of a low-carbon transition. |
| JEL: | Q |
| Date: | 2021–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:avg:wpaper:en12201&r=all |
| By: | Sam Hamels; Eline Himpe; Jelle Laverge; Marc Delghust; Kjartan Van den Brande; Arnold Janssens; Johan Albrecht |
| Abstract: | Reaching the 2030 targets for the EU primary energy use (PE) and CO2eq emissions (CE) requires an accurate assessment of how different technologies perform on these two fronts. In this regard, the focus in academia is increasingly shifting from traditional technologies to electricity consuming alternatives. Calculating and comparing their performance with respect to traditional technologies requires conversion factors (CFs) like a primary energy factor and a CO2eq intensity. These reflect the PE and CE associated with each unit of electricity consumed. Previous work has shown that the calculation and use of CFs is a contentious and multifaceted issue. However, this has mostly remained a theoretical discussion. A stock-taking of how CFs are actually calculated and used in academic literature has so far been missing, impeding insight into what the contemporary trends and challenges are. Therefore, we structurally review 65 publications across six methodological aspects. We find that 72% of the publications consider only a single country, 86% apply a purely retrospective perspective, 54% apply a yearly temporal resolution, 65% apply a purely operational (instead of a life-cycle) perspective, 91% make use of average (rather than marginal) CFs, and 75% ignore electricity imports from surrounding countries. We conclude that there is a strong need in the literature for a publicly available, transparently calculated dataset of CFs, which avoids the shortcomings found in the literature. This would enable more accurate and transparent PE and CE calculations, and support the development of new building energy performance assessment methods and smart grid algorithms. |
| Date: | 2021–02 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2102.13539&r=all |
| By: | , AISDL |
| Abstract: | This study is aimed towards assessing the role of banking development and energy consumption on economic growth in Vietnam for the period ranging from 1990 to 2019. The researcher has collected data on the variables from 1990 to 2019 related with banking development, energy consumption and economic growth. On the data collected on the specified variables, certain tests have been conducted. This research has used Stata as the statistical platform to carry out data analysis where descriptive statistics, Augmented Dickey Fuller (ADF), Bounds test, and Autoregressive Distributed Lag Model (ARDL) have been applied on the data. The results indicated that the data was non-stationary and had trend which can predict the future data. Based on this condition, ARDL test and Bounds test were applied. The results indicated that overall, the model was found to be significant. Individually, energy consumption had a significant impact in both short term and long term however, there was insignificant association among banking development and economic growth. |
| Date: | 2021–01–31 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:tnvkc&r=all |
| By: | Jean-Henry Ferrasse (Aix-Marseille Univ, CNRS, M2P2, Marseille, France); Nandeeta Neerunjun (Aix-Marseille Univ, CNRS, AMSE and M2P2, Marseille, France); Hubert Stahn (Aix-Marseille Univ, CNRS, AMSE, Marseille, France.) |
| Abstract: | We analyze the integration of intermittent renewables-based technologies into an electricity mix comprising of conventional energy. Intermittency is modeled by a contingent electricity market and we introduce demand-side flexibility through the retailing structure. Retailers propose diversified electricity contracts at different prices allowing consumers to choose their optimal electricity consumption. These contracts are modeled by a set of state-contingent electricity delivery contracts. We show existence and uniqueness of a competitive equilibrium of the contingent wholesale and retail markets. We provide a welfare analysis and only obtain constraint efficiency due to a limited number of delivery contracts. Finally, we discuss the conditions under which changing the set of delivery contracts improves penetration of renewables and increases welfare. This provides useful policy insights for managing intermittency and achieving renewable capacity objectives. |
| Keywords: | electricity market, renewables, intermittency, demand exibility |
| JEL: | Q41 Q42 D61 G13 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:2114&r=all |
| By: | Julian F Kölbel (University of Zurich, Department of Banking and Finance; MIT Sloan); Markus Leippold (University of Zurich - Department of Banking and Finance; University of Zurich - Faculty of Economics, Business Administration and Information Technology); Jordy Rillaerts (University of Zurich - Department of Banking and Finance; Swiss Finance Institute); Qian Wang (University of Zurich - Department of Banking and Finance) |
| Abstract: | We use BERT, an AI-based algorithm for language understanding, to decipher regulatory climate-risk disclosures and measure their impact on the credit default swap (CDS) market. Risk disclosures can either increase or decrease credit spreads, depending on whether disclosure reveals new risks or sharpens the signal and decreases the uncertainty. Training BERT to differentiate between transition and physical climate risks, we find that disclosing transition risks increases CDS spreads, especially after the Paris Climate Agreement of 2015, while disclosing physical climate risks leads to a decrease in CDS spreads. These impacts are statistically and economically highly significant. |
| Keywords: | climate risk disclosure, CDS spreads, 10-K filings, physical risks, transition risks, BERT model |
| JEL: | G13 G28 M48 |
| Date: | 2021–03 |
| URL: | http://d.repec.org/n?u=RePEc:chf:rpseri:rp2119&r=all |
| By: | Alberini, Anna; Horvath, Marco; Vance, Colin |
| Abstract: | The demand for motor fuel should decline when its price rises, but how exactly does that happen? Do people drive less, do they drive more carefully to conserve fuel, or do they do both? To answer these questions, we use data from the German Mobility Panel from 2004 to 2019, taking advantage of the fluctuations in motor fuel prices over time and across locales to see how they affect Vehicle Kilometers Traveled (VKT) and on-road fuel economy (expressed in kilometers per liter). Our reduced-form regressions show that while the VKTs driven by gasoline cars decrease when the price of gasoline rises, their fuel economy tends to get worse. It is unclear why this happens. Perhaps attempts to save on gasoline-cutting on solo driving, forgoing long trips on the highway, driving more in the city-end up compromising the fuel economy. By contrast, both the VKTs and the fuel economy of diesel cars appear to be insensitive to changes in the price of diesel. Latent class models confirm our main findings, including the fact that while fuel prices, car attributes, and household and location characteristics explain much of the variation in the VKTs, it remains difficult to capture the determinants of on-road fuel economy. Since the price elasticity of fuel consumption is the difference between the price elasticity of VKT and the price elasticity of the fuel economy, our results suggest that the fuel economy might be the "weakest link" of price-based policies that seek to address environmental externalities, such as a carbon tax. |
| Keywords: | On-Road fuel economy,price elasticity,vehicle kilometers traveled,motor fuel prices |
| JEL: | Q41 Q53 Q54 R41 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:rwirep:892&r=all |
| By: | Majed Al Suwailem; Malik Selemankhel (King Abdullah Petroleum Studies and Research Center) |
| Abstract: | Between January 2015 and mid-2020, about 69 of the approximately 2,160 small-to-medium independent oil companies operating in the tight oil sector filed for Chapter 11 protection. These filings mostly occurred in 2016 and 2019. A lack of financial discipline and poor financial risk assessment meant that these companies were negatively impacted by the low oil prices in these years. Hence, they declared bankruptcy. |
| Keywords: | Crude oil, Oil, Shale oil |
| Date: | 2021–02–14 |
| URL: | http://d.repec.org/n?u=RePEc:prc:dpaper:ks--2021-dp02&r=all |
| By: | OECD |
| Abstract: | The COVID-19 crisis has amplified the urgency of addressing together the dual challenges of inequality and environmental degradation. This paper contributes to the debate on the inequalities-environment nexus by analysing the consequences of the environmental degradation and of environmental policies on four well-being dimensions: health, income and wealth, work and job quality, and safety. The analysis shows that the impacts of environmental degradation tends to be concentrated among vulnerable groups and households. At the same, the benefits and costs of environmental policies are also likely to be unevenly distributed across households. In this context, policy packages for an inclusive green transition should aim at: (i) mitigating the possible regressive impact of pricing environmental externalities, (ii) investing in human capital and upgrading skills to facilitate labour reallocation, (iii) addressing systemic inequalities with sectoral and place-based policies, (iv) ensuring efficient and responsive governance. The paper concludes by highlighting the need for an effective framework to measure progress towards a people-centred green recovery, and possible areas of future work. |
| Keywords: | green transition, inequalities |
| Date: | 2021–03–08 |
| URL: | http://d.repec.org/n?u=RePEc:oec:envddd:2021/01-en&r=all |
| By: | Guo, B.; Newbery, D. |
| Abstract: | The UK left the EU Integrated Electricity Market on 31/12/20 and with it access to Single Day Ahead Coupling that clears local and cross-border trades jointly – interconnectors are implicitly auctioned. The new the Trade and Cooperation Agreement requires a replacement “Multi-region loose volume coupling†to be introduced before April 2022. Until then, interconnector capacity is allocated by an explicit day ahead auction before the EU auction with nomination after the EU results are known. The paper measures the risks posed by taking positions in each market separately and the resulting costs of uncoupling of GB’s interconnector trade. It compares four forecasts of price differences under two sequencing of markets and explicit auction, determining traders’ risk premia for each. The current timing leads to lower mistakes on the direction of flows, although higher profit volatility, arguing to retain the current timing. Competitive traders locking in their positions after the explicit auction (overstating costs as subsequent trading out of unprofitable positions is ignored) limit the total loss of interconnector revenue from uncoupling to €31 million/yr., and the social cost of uncoupling is €28 million/yr., considerably below earlier estimates in the literature. |
| Keywords: | Electricity trading, Market coupling, auctions, price forecasting |
| JEL: | F14 F15 Q47 Q48 L94 |
| Date: | 2021–03–03 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2118&r=all |
| By: | Nicoletta Batini; Ian Parry; Philippe Wingender |
| Abstract: | Denmark has a highly ambitious goal of reducing greenhouse gas emissions 70 percent below 1990 levels by 2030. While there is general agreement that carbon pricing should be the centerpiece of Denmark’s mitigation strategy, pricing needs to be effective, address equity and leakage concerns, and be reinforced by additional measures at the sectoral level. The strategy Denmark develops can be a good prototype for others to follow. This paper discusses mechanisms to scale up domestic carbon pricing, compensate households, and possibly combine pricing with a border carbon adjustment. It also recommends the use of revenue-neutral feebate schemes to strengthen mitigation incentives, particularly for transportation and agriculture, fisheries and forestry, though these schemes could also be applied more widely. |
| Keywords: | climate change, Denmark climate mitigation, carbon pricing, feebate, revenue recycling, border carbon adjustment, transportation, agriculture |
| JEL: | Q48 Q54 Q58 H23 |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:ces:ceswps:_8895&r=all |
| By: | Günther, Maik; Fallahnejad, Mostafa |
| Abstract: | With an increasing number of electric vehicles, the strategic planning of public charging infrastructure becomes more important. In this work, the infrastructure of the charging stations in a large city is simulated. Here, various influencing factors such as number of users, charging time, charging frequency, type of the charging station and billing model are modified in order to obtain the optimal construction and operation of public charging infra-structure. The results illustrate conditions under which a system for public charging infrastructure becomes un-stable as the number of users increases. In addition, it is shown, which measures should be used to improve the system characteristics. The results of the simulation reveal that with an increasing number of users a switch of the billing model can be more effective than the construction of additional charging station. Furthermore, it makes sense to construct distributed single charging points in a city at the beginning of the development phase and to switch to satellite systems with more charging points once the number of users has increased sufficiently. |
| Keywords: | Public charging infrastructure,billing model,user behaviour,electric vehicles,simulation |
| Date: | 2021 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:iubhit:12021&r=all |
| By: | Stefan Ambec; Philippe De Donder |
| Abstract: | Is green consumerism beneficial to the environment and the economy? To shed light on this question, we study the political economy of environmental regulations in a model with neutral and green consumers where the latter derive some warm glow from buying a good of higher environmental quality produced by a profit-maximizing monopoly, while the good bought by neutral consumers is provided by a competitive fringe. Consumers unanimously vote for a standard set at a lower than first-best level, or for a tax delivering the first-best environmental protection level. Despite its under-provision of environmental protection, the standard dominates the tax from a welfare perspective due to its higher productive efficiency, i.e., a smaller gap between the environmental qualities of the two goods supplied. In stark contrast, voters unanimously prefer a tax to a standard when the willingness to pay for greener goods is small enough. |
| Date: | 2020 |
| URL: | http://d.repec.org/n?u=RePEc:ces:econwp:_49&r=all |
| By: | Irims, Tonye |
| Abstract: | For a decent quality of life, energy is important. And many people in the world do not have adequate electricity. It is important to provide sustainable and sufficient energy sources that are not responsible for climate and emissions, and renewables offer a solution. In certain parts of the world, wind and solar farms will provide the cheapest electricity. In addition, all electricity demands in the world will be fulfilled. But, while market forces aid rapidly to switch from fossils to renewables, there are competing strains and challenges faced by the developed and developing countries. The increasing clean, productive and sustainable energy fields have contributed to the creation of past experiments, which entail a transition to more sustainable energy management. Energy Management is a concept used to reduce and monitor the volume and expense of energy used to deliver a service. All systematic processes focused in the current study begins by examining the links between population, economy and energy consumption in the past, and analyzing the conventional and renewable sources of energy, as well as their management, in order to support ever-growing requirements for energy in the coming decades. This report is also about the recent green energy management technologies as well as primary threats and risks. Potential new clean energy initiatives and policies in developed markets, along with high-level renewable management examples in emerging economies, are discussed. Finally, the study focuses on renewable energy management in operation from the frontline of energy insecurity in the industrialized world. The Researcher offers new frameworks for energy sustainability measurements, realistic approaches for the deployment of renewable energies and enhancement of efficiencies and specific insights into risk control in power generation plants. |
| Date: | 2021–02–21 |
| URL: | http://d.repec.org/n?u=RePEc:osf:osfxxx:yzwun&r=all |
| By: | Juan Carlos Miranda Passo; Luis Emiro Maestre |
| Abstract: | Este artículo de reflexión pretende abocar de manera sucinta una serie de críticas que se le realizan a Electricaribe S.A. E.S.P, ilustrar sobre la crisis que afronta la empresa y desmontar ciertas quimeras que se han tejido sobre la problemática en la prestación del servicio público de energía en la región Caribe. Se analizan diferentes factores para entender esta crisis que atraviesa la costa en calidad de servicio energético, y ofrecer unas conclusiones que sirvan para solucionar la problemática que se vive con la prestación del servicio de energía. |
| Keywords: | Servicios públicos; subnormalidad eléctrica; Crisis |
| Date: | 2019–05–02 |
| URL: | http://d.repec.org/n?u=RePEc:col:000563:018718&r=all |