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on Energy Economics |
| By: | Mr. James Roaf; Mr. Simon Black; Karlygash Zhunussova; Danielle N Minnett; Ian W.H. Parry |
| Abstract: | There is growing interest in international coordination over climate mitigation policy. Climate clubs or international carbon price floors could complement the Paris Agreement by helping to deliver the near-term cuts in global greenhouse gas emissions needed to contain global warming to 1.5 to 2oC. To ensure inclusivity, these arrangements need to account for varying mitigation policies across countries, including carbon pricing, fuel taxes, subsidy reform, and non-pricing approaches like regulations. A transparent methodology is needed to compare and monitor mitigation effort by countries implementing diverse policy packages. This paper presents and illustrates a methodology for converting climate mitigation policies and targets into their carbon price equivalents and applies it to the Group of Twenty (G20) countries. |
| Keywords: | Emissions reductions; carbon price equivalence; G20; non-pricing instrument; sectoral target; fuel taxes; temperature aligned mitigation.; climate mitigation policy; annex B. policy equivalence; reductions from Policites; policy package; industry emissions target; policy instrument; mitigation approach; emissions impact; BAU emissions projection; emission rate standard; Greenhouse gas emissions; Fuel tax; Climate policy; Global; Africa |
| Date: | 2022–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2022/254&r=ene |
| By: | Ara Jo (Department of Economics, University of Bath, 3 East, BA2 7AY, Bath, United Kingdom); Christos Karydas (Center of Economic Research, ETH Zurich, Zurichbergstrasse 18, 8092 Zurich, Switzerland) |
| Abstract: | We develop a dynamic general equilibrium model to quantify the interaction between climate policy, industry dynamics, and the elasticity of substitution between clean and dirty energy in the economy. The model incorporates empirical observations that firms differ substantially in their potential for energy substitution and that the economy is growing more capable of substituting clean for dirty energy over time as environmental regulation becomes more stringent. Our model highlights the effect of dynamic industry response on increasing the average elasticity of substitution in the economy due to the exit of least flexible firms in response to climate policy. The higher average elasticity of substitution increases the effectiveness of the policy at reducing emissions, resulting in a 35 percent decrease in the size of the carbon tax required to achieve carbon neutrality |
| Keywords: | industry dynamics, elasticity of substitution, climate policy |
| JEL: | Q40 Q55 Q54 O33 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:eth:wpswif:23-378&r=ene |
| By: | Gregor Schwerhoff; Jean Chateau; Ms. Florence Jaumotte |
| Abstract: | We use a global computable general equilibrium model to compare the economic performance of alternative climate policies along multiple dimensions, including macroeconomic outcomes, energy prices, and trade competitiveness. Carbon pricing which keeps the aggregate cost lower and preserves better the overall competitiveness than across-the-board regulation is the first-best policy, especially in energy intensive and trade exposed industries. Regulations and feebates are good alternatives in the power sector, where technological substitution is possible. Feed-in subsidies, if used alone, are not cost effective. |
| Keywords: | Climate policy; policy coordination; carbon leakage; carbon tax; regulation.; climate policy option; Policy stringency; EITE sectors scenario; ambition level; Policy instrument; Greenhouse gas emissions; Non-renewable resources; Global |
| Date: | 2022–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2022/242&r=ene |
| By: | Tobias Riepl; Zuzana Zavarská (The Vienna Institute for International Economic Studies, wiiw) |
| Abstract: | The European Green Deal, which aims to steer the EU towards climate neutrality, has traditionally been met with a degree of reluctance by the Visegrád countries. The convergence to green targets represents a particular challenge for these economies, given their fossil fuel-intensive industrial orientation and the high labour market exposure of certain regions to coal mining. In reality, progress with the green transition in the region has been mixed. The expansion of renewables has been scaled up in Slovakia and partially in Poland, but has been stagnating in Czechia and even decreasing in Hungary. In the building sector, states’ retrofitting schemes are working well in terms of bringing down energy consumption in housing, despite the limited adoption of innovative heating techniques. In transport, the region focuses almost excessively on highly contested biofuels, whereas the use of green electricity for road transportation and rail systems remains negligible. Still, the Visegrád group has accomplished a remarkable catch-up in enhancing its energy efficiency in recent years, albeit still belonging to the most CO2-intensive regions in Europe. There are numerous obstacles to the green transition in the region, including lower starting points creating path-dependencies, lesser (albeit growing) social recognition of the climate crisis, and the fear of social fallout due to high employment in the coal and automobile sectors. At the same time, the Russian aggression against Ukraine has revealed the vulnerabilities of fossil fuel dependency, and as a result has broadened the pro-green-transition coalition. While it remains to be seen whether this momentum will turn into action, green pioneers such as Austria can take on a more active role by cooperating with and supporting the Visegrád countries in reaching their climate targets. This includes deepening cooperation on green electricity projects, strengthening basic research through cross-country consortia, or incentivising investment in the building and transportation sector, in which Austrian firms are well-positioned. |
| Keywords: | Visegrád countries, European Green Deal, green transition, renewable energy |
| JEL: | O13 Q58 Q42 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:wii:pnotes:pn:64&r=ene |
| By: | Simshauser, P. |
| Abstract: | The war in Ukraine and the associated 2022 energy crisis has had far-reaching effects with seaborne prices for coal and gas reaching multiples (5-6x) of their historic averages. While Europe was the epicentre, countries as far away as Australia were impacted. As a major exporter of coal and gas, domestic markets are linked to seaborne prices. Consequently, forward prices for 2023 delivery in Australia’s National Electricity Market surged from ~$48 in 2021 to $156/MWh in 2022 at one point peaking at $247/MWh. Household electricity tariffs were set to in-crease by 11% in 2023 and 35% in 2024. In late-2022, the Commonwealth Government intervened by setting fuel price caps of $125/t and $12/GJ for coal and gas, respectively. Given an estimated market heat rate of ~8.2GJ/MWh, forward prices reduced to ~$105/MWh. In this article, price increases before- and after- policy interventions are analysed. 2024 tariff increases after policy intervention are forecast to increase by 16.5% (cf.35%), benefiting all customers. State Government hardship policy remains vitally important, however. Underlying levels of fuel poverty in 2024 are forecast at 12.1% pre-policy, and 6.7% after policy intervention, with State-level hardship policies making the larger (3.2 percentage point) contribution to this result. |
| Keywords: | Electricity markets, energy policy, fuel poverty |
| JEL: | D4 L5 L9 Q4 |
| Date: | 2203–01–13 |
| URL: | http://d.repec.org/n?u=RePEc:cam:camdae:2307&r=ene |
| By: | Tii N. Nchofoung (Ministry of Trade, Cameroon); Hervé Kaffo Fotio (University of Maroua, Cameroon); Clovis Wendji Miamo (University of Dschang, Cameroon) |
| Abstract: | There is substantial literature on the determinants of renewable energy consumption. This growing interest is related to the fact that renewable energy is not only one of the main drivers of greenhouse gas mitigation but also its contribution to the achievement of other sustainable goals. Despite this strategic role, the adoption level of renewable energy remains quite low. In this article, we address one of the determinants so far ignored by the literature, namely the environmental tax. This study, therefore, examines the effect of environmental taxes on the adoption of renewable technologies for 49 global samples between the 1996-2017 periods. The results through the FE Driscoll and Kraay, the Newey-West, the system GMM, and the quantile regression methodologies show that environmental tax increase the consumption of renewable energy. However, taking into account disparities in the level of development, the results suggest that the environmental tax spurs renewable energy technologies adoption in developed countries while it decreases renewable energy technologies adoption in developing countries. As policy implications, policymakers within this sample should consider the optimization of environmental taxation as a policy toward environmental protection. This would cause energy consumers to opt for renewable energy sources of energy to escape these taxes. |
| Keywords: | Green taxation; renewable energy; panel data; SDG7; environmental protection |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:agd:wpaper:23/007&r=ene |
| By: | Jinhui Li |
| Abstract: | Carbon neutralization is an urgent task in society because of the global warming threat. And carbon trading is an essential market mechanics to solve carbon reduction targets. Macro carbon price prediction is vital in the useful management and decision-making of the carbon market. We focus on the EU carbon market and we choose oil price, coal price, gas price, and DAX index to be the four market factors in predicting carbon price, and also we select carbon emission targets from Paris Accord as the political factor in the carbon market in terms of the macro view of the carbon price prediction. Thus we use these five factors as inputs to predict the future carbon yearly price in 2030 with the support vector regression models. We use grid search and cross validation to guarantee the prediction performance of our models. We believe this model will have great applications in the macro carbon price prediction. |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2212.11787&r=ene |
| By: | Claire Alestra (Aix-Marseille University, CNRS, AMSE, France); Gilbert Cette (NEOMA Business School, France); Valérie Chouard (Banque de France, France); Rémy Lecat (Banque de France, France) |
| Abstract: | This paper highlights how technology can contribute to reaching the COP21 goals of net zero CO 2 emissions and global warming below 2°C at the end of the century. It uses the ACCL model, particularly adapted to quantify the consequences of energy price shocks and technology improvements on CO 2 emissions, temperature changes, climate damage and GDP. Our simulations show that without climate policies, i.e. a 'business as usual' scenario, the warming may be +4 to +5°C in 2100, with considerable climate damage. We also find that an acceleration in 'usual technical progress'-not targeted at reducing greenhouse gas intensity-makes global warming and climate damage worse than the 'business as usual' scenario. According to our estimates, the world does not achieve climate goals in 2100 without technological changes to avoid CO 2 emissions. To hit such climatic targets, intervening only through the relative price of different energy types, e.g. via a carbon tax, requires challenging hypotheses of international coordination and price increase for polluting energies. We assess a multi-lever climate strategy, associating diverse price and technology measures. This mix combines energy efficiency gains, carbon sequestration, and a decrease of 3% per year in the relative price of non-carbon-emitting electricity with a 1 to 1.5% annual rise in the relative price of our four polluting energy sources. None of these components alone is sufficient to reach climate objectives. Our last and most important finding is that our composite scenario achieves the climate goals. |
| Keywords: | climate, global warming, Technology, Environmental policy, growth, long-term projections, Uncertainties, Renewable energy |
| JEL: | H23 Q54 E23 E37 O11 O47 O57 Q43 Q48 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:aim:wpaimx:2301&r=ene |
| By: | Jochen M. Schmittmann; Yun Gao |
| Abstract: | We analyze the corporate green bond market under a rational framework without an innate green preference, using a simple adverse selection model. Firms can use green bonds to signal their green credentials to investors. Transition risk stems from uncertainty over the introduction of carbon pricing. We show that green bonds have a price premium over conventional bonds when there are information asymmetry, transition risk, and it is costly to engage in greenwashing, that is, false or exaggerated claims of being green. The extent of greenwashing in the market is a function of the green bond premium. A swift and gradual implementation of carbon pricing generates a small green bond premium and a low level of greenwashing, while delayed and large carbon pricing has an ambiguous effect on both. The model provides a rich set of policy implications, notably the need for swift action on carbon pricing and strong information disclosures and regulations to ensure the integrity of green bonds. |
| Keywords: | green bond pricing; greenwashing; transition risk; carbon pricing; green debt; climate finance; green bond premium; brown firm; green bond; Carbon tax; Bonds; Greenhouse gas emissions; Asia and Pacific; Global |
| Date: | 2022–12–09 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2022/246&r=ene |
| By: | Laurent Millischer; Tatiana Evdokimova; Oscar Fernandez |
| Abstract: | Financial markets can support the transition to a low-carbon economy by redirecting funds from highly emissive to clean investments. We study whether European stock markets incorporate carbon prices in company valuations and to what degree they discriminate between firms with different carbon intensities. Using a novel dataset of stock prices and carbon intensities of 338 European publicly traded companies between 2013 and 2021, we find a strongly statistically significant relationship between weekly carbon price changes and stock returns. Crucially, this relationship depends on firms’ carbon intensity: the higher the carbon costs a firm faces, the poorer its stock performance during the periods of carbon price increases. Emissions covered with free allowances however do not affect this relationship, illustrating how both carbon pricing and disclosures are needed for financial markets to foster climate change mitigation. The relationship we identify can provide an incentive for firms to decarbonize. We argue in favor of more ambitious carbon pricing policies, as this would strengthen the stock-market incentive channel while causing only limited financial stability risk for stocks. |
| Keywords: | European Union Emissions Trading Scheme; Carbon price; Stock price valuation; Climate Finance; Climate Change Mitigation; Multifactor Market Model; stock-market incentive channel; firm face; IMF working papers; carbon intensity; Greenhouse gas emissions; Asset prices; Non-wage benefits; Inflation; Europe |
| Date: | 2022–11–18 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2022/231&r=ene |
| By: | Vierth, Inge (Swedish National Road & Transport Research Institute (VTI)); Ek, Karin (Swedish National Road & Transport Research Institute (VTI)); From, Emma (Swedish National Road & Transport Research Institute (VTI)); Lind, Joar (Swedish National Road & Transport Research Institute (VTI)) |
| Abstract: | The purpose of the paper is to analyze the cost impacts of policy instruments that are part of the European Commission’s climate policy package "Fit for 55". A disaggregated approach for the cargo ships calling at Swedish ports is applied to study the effects of different designs of the extension of the Emissions Trading System (EU ETS) to shipping and the changed Energy Tax Directive (ETD), which implies the introduction of taxes for marine fuel. Three scenarios are compared to the actual situation: the Main scenario is based on the European Commission’s proposal that ships with at least 5, 000 gross tonnage (GT) must be included in the EU ETS and that taxes for marine fuels are introduced, the Low scenario assumes no fuel taxes and the High scenario that ships with at least 400 GT must be included in the EU ETS. A major conclusion is that cargo ships calling at Swedish ports with at least 5, 000 GT account for 56 % of all cargo ships and for 78 % of all CO2 emissions from these ships, which implies that a significant part of the CO2 emissions is missed when the European Commission’s proposal regarding the inclusion of shipping in the EU ETS is applied. The share of missed CO2 emissions could further increase if ships smaller than 5, 000 GT are chosen to avoid the EU ETS. Calculations with the Swedish national freight transport model Samgods confirm that firms have incentives to shift to ships smaller than 5, 000 GT in the Main scenario while they have incentives to shift to ships larger than 5, 000 GT in the High scenario. A recommendation is therefore that smaller ships than 5, 000 GT should also be included in the EU ETS, and if this cannot be done immediately, the EU should clearly plan for ships with less than 5, 000 GT to also be included in the long term and signal this to the market. This would reduce the incentives for the market to make socioeconomically undesirable adjustments to avoid paying for emissions. The fuel cost increases due to the implementation of the policy instruments are estimated per ship and aggregated to nine ship segments. In the Main scenario, the fuel cost increases due to the inclusion of shipping in the EU ETS are in the range of 11-42 % within the European Economic Area (EEA) and in the range of 5-21 % for transports to/from the EEA. In the High scenario, the costs in all segments are roughly 40 % within the EEA and 21% for the sea transports to/from the EEA. The introduction of fuel taxes is estimated to increase the fuel costs for all ships operating within the EEA by about 6 %. Calculations with the Samgods model indicate that the estimated higher fuel costs for shipping have limited impacts on the firms’ choices of mode and port and their total logistics costs. |
| Keywords: | Climate policy; Policy design; Impact analysis; Shipping |
| JEL: | Q58 R48 |
| Date: | 2023–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:hhs:vtiwps:2023_001&r=ene |
| By: | Sangeeta Bansal (Centre for International Trade and Development, School of International Studies, Jawaharlal Nehru University, New Delhi, India); Massimo Filippini (Center of Economic Research (CER-ETH), ETH Zürich, Università della Svizzera italiana, Switzerland); Suchita Srinivasan (Center of Economic Research, ETH Zurich, Zurichbergstrasse 18, 8092 Zurich, Switzerland) |
| Abstract: | This paper evaluates the impact of a policy that was implemented to reduce the energy intensity of firms in some manufacturing sectors in India, on the total factor productivity (TFP) growth of firms and on its components, scale efficiency and technical change. Using plant-level panel data on the cement industry from 2007-2015 and a difference-in-difference methodology, we find that treated plants had higher rates of TFP growth, compared to control plants. This is largely driven by the fact that they expanded their production compared to control plants, even though they experienced lower rates of technical change compared to control plants. To explain this finding, we verify that treated plants attempted to meet the energy-intensity mandate not by reducing their energy consumption, but instead by increasing their output. Our results suggest that energy intensity regulations may not reduce energy consumption, because firms may find other ways to fulfil targets. The policy implications of this study are related to the design of energy-efficiency regulations, particularly in developing countries where firms in some industries may find it difficult to reduce their energy consumption through investment in new energy-efficient technologies or processes. |
| Keywords: | Total factor productivity; Climate change mitigation; Environmental Regulation; Cement Industry; Energy Intensity; India |
| JEL: | D1 D8 Q4 Q5 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:eth:wpswif:23-379&r=ene |
| By: | Böning, Justus; Di Nino, Virginia; Folger, Till |
| Abstract: | The EU is revising its emissions trading system (ETS) and plans to impose a carbon border adjustment mechanism (CBAM) on imports. We evaluate the efficacy of the ETS retrospectively and its anti-competitive effects. We find that the ETS contributed to cut greenhouse gas (GHG) emissions in the EU by 2-2.5 percentage points per year; pricier emissions and more stringent caps accelerated the EU greening process. However, some carbon leakages occurred as declining emissions in regulated industries within the EU were counterbalanced by an intensification elsewhere. Moreover, it burdened companies in regulated industries. For a comparable rise in the emission intensity of production, gross output of companies located in the EU drops more than output of companies outside the EU. In addition, the choice of purchasing high-emission inputs from within the EU translates into a competitive disadvantage for companies located within the EU. The large drop in F-type output when emissions intensity rises might signal their enhanced ability to relocate the production of high-carbon footprints intermediates to non-regulated regions. Outsourcing helps dodging the EU green regulation and the strategy becomes increasingly appealing as the sectoral coverage of the ETS is extended. A careful joint design of the CBAM and the ETS becomes thus crucial to avoid that applying the CBAM to a restricted list of imports while expanding the ETS coverage puts the EU at greater risk of carbon leakages without concretely reducing global emissions. JEL Classification: Q52, Q58 |
| Keywords: | Carbon leakages, CBAM, ETS, GHG emissions |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:ecb:ecbwps:20232764&r=ene |
| By: | Lee, Sangwon (Korea Institute for Industrial Economics and Trade) |
| Abstract: | The concept of a just transition, which was based on the labor movement, has evolved and spread to other areas and fields, from climate justice organizations to international organizations and the private sector. As dealing with global climate change has become a priority, the meaning of the phrase has evolved to be used in policy tools that seek to minimize the burden and damage to vulnerable industries, workers, regions and classes from a low-carbon transition. Recently, Korea has also declared its intent to become carbon neutral by 2050, and awareness of the just transition has grown alongside that of a green industrial transition. However, Korea’s strategies are still in its early stages, so efforts are being made for more discussions and concrete policies for a just industrial transition. This paper examines just transition strategies and policies across the world and proposes a set of policies that may help ensure a just transition for all stakeholders. |
| Keywords: | climate change; carbon emissions; industrial structure; just transition; renewable energy; environmental policy; industrial policy; net-zero; net-zero emissions; carbon neutrality; carbon neutrality policy; carbon policy; Korea |
| JEL: | P18 Q43 Q56 |
| Date: | 2022–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kieter:2022_017&r=ene |
| By: | Hege, Ulrich; Pouget, Sébastien; Zhang, Yifei |
| Abstract: | We study the impact of climate-related patents on financial markets. We exploit the quasi-random assignment of patent examiners with different degrees of leniency as an exogenous shock in patent approvals to allow for causal interpretations. We find that firms with more lucky climate-related patents subsequently display higher positive cumulative abnormal stock returns and enjoy a lower cost of capital, compared with similarly innovative but unlucky firms. These results hold especially during periods of high attention towards climate change and for initial climate patent granting. Firms with more lucky climate-related patents also exhibit better environmental ratings and attract more responsible institutional investors. OLS regressions show that firms developing more climate-related technologies reduce more direct carbon emission intensity. |
| Keywords: | climate-related patents; green patents; examiner leniency; climate change; implied cost of capital; ESG ratings; responsible investors; CO2 emissions. |
| JEL: | G11 G23 G24 O34 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:tse:wpaper:127752&r=ene |
| By: | Andreas Gerster; Stefan Lamp |
| Abstract: | Environmental policies are often accompanied by exemptions for energy-intensive and trade-exposed industrial firms to avoid leakage from regulated to unregulated jurisdictions. This paper investigates the impact of a large electricity tax exemption on production levels, employment, and input choices in the German manufacturing industry. For two different policy designs, we show that exempted plants significantly increase their electricity use. This effect is considerably larger under a notched exemption policy, where passing an eligibility threshold yields infra-marginal benefits, compared to a revised policy where these benefits have been largely removed. We detect no significant impact of the exemptions on production levels, export shares, and employment. Using counterfactual simulations, we document substantial distortive effects of notched exemption policies when financial stakes are high and compliance cost for firms are low. |
| Keywords: | Environmental Policy, Leakage, Energy Taxes, Manufacturing Industry |
| JEL: | D22 H23 L60 Q41 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:bon:boncrc:crctr224_2023_388&r=ene |
| By: | Majid Hashemi (Department of Economics, Queens University, Kingston, Ontario Canada and Cambridge Resources International Inc.); Glenn P. Jenkins (Department of Economics, Queens University, Kingston, Ontario, Canada and Cambridge Resources International Inc.); Frank Milne (Department of Economics, Queens University, Kingston, Ontario, Canada) |
| Abstract: | This paper develops a framework for a financial, economic, and stakeholder analysis of a residential rooftop solar net-metering program. The empirical focus of the paper is the net metering program in Ontario, Canada, but the methodology is applicable to evaluating other public programs. The results highlight that without the Federal Government’s subsidy for the initial investment cost, net-metered solar systems are not financially viable for representative households. Moreover, the stakeholder analysis reveals that for each additional net-metered system installed in Ontario, non-net-metered households experience financial losses of eight times the benefits to the net-metered households. The net losses to the Federal Government of Canada and the Canadian economy are six and twelve times the benefit to the net-metered households, respectively. The only stakeholder who benefits marginally is the Government of Ontario. In terms of environmental benefits, our estimate of the cost of greenhouse gas abatement by residential net-metered solar is 413 CAD per ton of CO2e, which is significantly higher than the current (65 CAD in 2023) and future (170 CAD by 2030) social cost of carbon set by the Government of Canada. |
| Keywords: | rooftop solar, net metering, greenhouse gas emissions, renewable energy, the social cost of carbon, Canada |
| JEL: | D61 L94 Q42 Q48 |
| Date: | 2023–01–25 |
| URL: | http://d.repec.org/n?u=RePEc:qed:dpaper:4598&r=ene |
| By: | Cathal O’Donoghue; Jules Linden; Denisa Sologon |
| Abstract: | This paper lays out an approach, and a research agenda, for assessing the impact of carbon pricing on household budgets. It relies on a rich set of available data and policy models and combines them in a way that is informative for mapping the gains and losses at the household level in the short term as countries transition to a low-carbon economy. After accounting for direct burdens from higher fuel prices, indirect effects from higher prices of goods other than fuel, and households’ behavioural responses, overall burdens are only mildly regressive. Recycling carbon-tax revenues back to households allows considerable scope for avoiding or cushioning losses for large parts of the population, and existing policy models can be used to design compensation measures that facilitate majority support for carbon tax packages. |
| Keywords: | Carbon tax, Carbon tax, climate change, inequality, revenue recycling |
| JEL: | C8 D12 D31 H23 Q52 |
| Date: | 2023–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:oec:elsaab:283-en&r=ene |
| By: | Marion Leroutier (SSE - Stockholm School of Economics); Philippe Quirion (CIRED - Centre International de Recherche sur l'Environnement et le Développement - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - EHESS - École des hautes études en sciences sociales - AgroParisTech - ENPC - École des Ponts ParisTech - Université Paris-Saclay - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Objectives: Energy transition scenarios are prospective outlooks describing combinations of changes in socio-economic systems that are compatible with climate targets. These changes could have important health co-benefits. We aimed to quantify the health benefits of physical activity caused by active transportation on all-cause mortality in the French negaWatt scenario over the 2021–2050 period. Methods; Relying on a health impact assessment framework, we quantified the health benefits of increased walking, cycling and E-biking projected in the negaWatt scenario. The negaWatt scenario assumes increases of walking and cycling volumes of +11% and +612%, respectively, over the study period. Results: As compared to a scenario with no increase in volume of active travel, we quantified that the negaWatt scenario would prevent 9, 797 annual premature deaths in 2045 and translate into a 3-month increase in life expectancy in the general population. These health gains would generate €34 billion of economic benefits from 2045 onwards. Conclusion: Increased physical activity implied in the negaWatt transition scenario would generate substantial public health benefits, which are comparable to the gain expected by large scale health prevention interventions. |
| Keywords: | Transport externalities, Environmental inequalities, LMDI |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:hal-03921086&r=ene |
| By: | Anne de Bortoli; Maxime Agez |
| Abstract: | Industries struggle to build robust environmental transition plans as they lack the tools to quantify their ecological responsibility over their value chain. Companies mostly turn to sole greenhouse gas (GHG) emissions reporting or time-intensive Life Cycle Assessment (LCA), while Environmentally-Extended Input-Output (EEIO) analysis is more efficient on a wider scale. We illustrate EEIO analysis usefulness to sketch transition plans on the example of Canada s road industry - estimation of national environmental contributions, most important environmental issues, main potential transition levers of the sector, and metrics prioritization for green purchase plans). To do so, openIO-Canada, a new Canadian EEIO database, coupled with IMPACT World plus v1.30-1.48 characterization method, provides a multicriteria environmental diagnosis of Canada s economy. The road industry generates a limited impact (0.5-1.8 percent) but must reduce the environmental burden from material purchases - mainly concrete and asphalt products - through green purchase plans and eco-design and invest in new machinery powered with cleaner energies such as low-carbon electricity or bioenergies. EEIO analysis also captures impacts often neglected in process-based pavement LCAs - amortization of capital goods, staff consumptions, and services - and shows some substantial impacts advocating for enlarging system boundaries in standard LCA. Yet, pavement construction and maintenance only explain 5 percent of the life cycle carbon footprint of Canada s road network, against 95 percent for the roads usage. Thereby, a carbon-neutral pathway for the road industry must first focus on reducing vehicle consumption and wear through better design and maintenance of roads (...) |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2301.08302&r=ene |
| By: | Fernandes, Bernardo de Barros; Ferreira, Pedro Cavalcanti |
| Abstract: | We develop a multi-sector general equilibrium model, with intersectorial input–output linkages and CO2 emissions, to investigate the economic impacts of the implementation of a carbon taxation policy in an economy permeated by preexisting distorting taxes. The model is calibrated to Brazil and the carbon price is set so that the economy meets its annual global greenhouse gases emissions pledge for 2030 based on the Paris Agreement. In the presence of production networks, the initially concentrated tax shocks propagate throughout the economy, provoking widespread relative input price variations. Depending on the deforestation scenario, GDP losses range between 5.71% and 0.25%, the latter corresponding to the record low deforestation levels of 2012. Sectors are heterogeneously affected. As expected, those sectors more reliant on taxed pollutant resources (e.g., Energy and Transport) suffer sizable decreases in production. But a significant part of the impacts on sectorial production comes indirectly through network effects, even in the absence of new taxes levied on the sector’s product or its direct inputs. When Agriculture & Livestock are also taxed, GDP losses are considerably smaller. |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:fgv:epgewp:833&r=ene |
| By: | Oya Celasun; Mr. Li Zeng; Ms. Aiko Mineshima; Yu Ching Wong; Mr. Frederik G Toscani; Mr. Nicolas Arregui; Jing Zhou; Mr. Victor Mylonas; Ms. Dora M Iakova |
| Abstract: | The recommended way of helping households during the ongoing European energy crisis is to allow price signals to operate freely while providing targeted compensation to the vulnerable. In practice, however, institutional, political, and technical constraints have led many European governments to adopt broad, price-suppressing measures, which impede the adjustment in demand, have high fiscal costs, and widen cross-country gaps in prices. This paper focuses on easy-to-implement, second-best policies. Bonuses or rebates on energy bills (that are not linked to the current volume of consumption) or block tariffs are simple options which would improve on the current policy design in many countries. To avoid stoking inflation, fiscal policy should not add to aggregate demand, so relief for energy bills should be targeted and coupled with offsetting fiscal measures. One option is to reclaim the relief from the better-off through income taxation, which would also make support more progressive. |
| Keywords: | energy prices; price pass-through; household incidence; distributional analysis; social safety nets; energy cost support measure; I. consumer energy price inflation; price signal; price-suppressing measure; EU government; Energy pricing; Consumption; Natural gas sector; Income; Europe |
| Date: | 2022–12–16 |
| URL: | http://d.repec.org/n?u=RePEc:imf:imfwpa:2022/262&r=ene |
| By: | Lee, Sul-Ki (Korea Institute for Industrial Economics and Trade) |
| Abstract: | Manufacturing and other carbon-intensive sectors account for a large proportion of the Korean economy, and so transitioning into a low-carbon society will necessitate a soft landing; efforts to cut greenhouse gas emissions must not impair the ability of economic growth to produce qualitative improvements in quality of life. In this context, it is essential for Korea to comprehensively examine the impact of the EU CBAM on Korea’s manufacturing industry and develop countermeasures. This paper examines domestic and foreign policy trends with regards to EU carbon border adjustment, and conceptually summarizes various pathways through which the EU carbon border adjustment may affect Korea’s economy. |
| Keywords: | carbon border adjustment mechanism; CBAM; greenhouse gas emissions; GHG emissions; GHGs; steel; manufacturing; Korea; manufacturing competitiveness; environmental policy; environmental regulation; carbon emissions; emissions policy; carbon policy; EU; European Union |
| JEL: | P18 Q48 Q54 |
| Date: | 2022–10–01 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kieter:2022_016&r=ene |
| By: | Matthias Kalkuhl (MCC Berlin, University of Potsdam); Max Franks (PIK Potsdam, TU Berlin); Friedemann Gruner (MCC Berlin, University of Potsdam); Kai Lessmann (PIK Potsdam, MCC Berlin); Ottmar Edenhofer (PIK Potsdam, MCC Berlin, TU Berlin) |
| Abstract: | Carbon dioxide removal from the atmosphere is becoming an important option to achieve net zero climate targets. This paper develops a welfare and public economics perspective on optimal policies for carbon removal and storage in non-permanent sinks like forests, soil, oceans, wood products or chemical products. We derive a new metric for the valuation of non-permanent carbon storage, the social cost of carbon removal (SCC-R), which embeds also the conventional social cost of carbon emissions. We show that the contribution of CDR is to create new carbon sinks that should be used to reduce transition costs, even if the stored carbon is released to the atmosphere eventually. Importantly, CDR does not raise the ambition of optimal temperature levels unless initial atmospheric carbon stocks are excessively high. For high initial atmospheric carbon stocks, CDR allows to reduce the optimal temperature below initial levels. Finally, we characterize three different policy regimes that ensure an optimal deployment of carbon removal: downstream carbon pricing, upstream carbon pricing, and carbon storage pricing. The policy regimes differ in their informational and institutional requirements regarding monitoring, liability and financing. |
| Keywords: | Carbon Dioxide Removal, Carbon Capture, Social Cost of Carbon, Climate Policy, Impermanence |
| JEL: | D61 H23 Q54 Q58 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:pot:cepadp:62&r=ene |
| By: | Grebel, Thomas; Islam, Rohidul |
| Abstract: | Since its introduction, the European Emissions Trading Scheme (EU ETS) has been struggling with an oversupply of emission allowances and a highly volatile allowance price. One reason for the price decline is technological progress and ist demand-reducing effect, which is only partially taken into account in the system. We propose a simple benchmark approach to endogenously adjust the supply of allowances to technical progress. Using a non-parametric benchmark approach, we measure the required adjustment of the allowance supply to avoid a technologyinduced price decline and to maintain the incentive to invest in low-carbon technologies. |
| Keywords: | EU ETS, emission allowances, Data Envelopment Analysis, endogenous adjustment of supply, technological change, yardstick competition |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:tuiedp:169&r=ene |
| By: | Teodora Boneva; Armin Falk; Mark Fallak; Lasse Stötzer |
| Abstract: | According to a representative briq survey, more than two-thirds of the German population would support a halt to energy imports from Russia in order to increase pressure on the Russian government. A broad ma- jority would also welcome additional measures to reduce energy dependence, including alternative energy sources and energy-saving. When it comes to helping the Ukrainian people, many of the respondents would support both aid and integration policies, including permanent residence and work permits for refugees. Germans are divided, however, on the question of further arms deliveries to Ukraine. |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkpbs:031_en&r=ene |
| By: | Chan, Jenny; Diz, Sebastian; Kanngiesser, Derrick |
| Abstract: | How does household heterogeneity affect the transmission of an energy price shock? What are the implications for monetary policy? We develop a small, open-economy TANK model that features labor and an energy import good as complementary production inputs (Gas-TANK). Given such complementarities, higher energy prices reduce the labor share of total income. Due to borrowing constraints, this translates into a drop in aggregate demand. Higher price flexibility insures firm profits from adverse energy price shocks, further depressing labor income and demand. We illustrate how the transmission of shocks in a RANK versus a TANK depends on the degree of complementarity between energy and labor in production and the degree of price rigidities. Optimal monetary policy is less contractionary in a TANK and can even be expansionary when credit constraints are severe. Finally, the contractionary effect of an energy price shock on demand cannot be generalized to alternate supply shocks, as the specific nature of the supply shock affects how resources are redistributed in the economy. |
| Keywords: | Heterogenous agent models, business cycle fluctuations, energy, monetary policy |
| JEL: | E5 |
| Date: | 2022–10 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:115975&r=ene |
| By: | Dagher, Leila; Hasanov, Fakhri |
| Abstract: | This paper examines the relationship between oil market shocks and financial instability in Asian countries using a Structural Vector Autoregression (SVAR) following Kilian’s (2009) methodology. Instability in the Asian financial markets is measured by the Financial Stress Index (FSI). Based on impulse response functions, the findings confirm that the source of an oil price shock (supply side or demand side) is extremely important to financial markets. When the oil price increases as a result of oil-specific demand shocks, the financial markets experience less stress. However, when the oil price increases as a result of oil-specific supply shocks, the financial markets experience increased stress. The findings of the study should be useful for international and domestic investors for portfolio diversification and other investment-production purposes, as well as for financial stability regulators and other monetary authorities. |
| Keywords: | FSI, oil price, oil supply, Asian countries, SVAR, impulse response functions |
| JEL: | E44 G01 G18 Q43 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:116079&r=ene |
| By: | Xin Sheng (Lord Ashcroft International Business School, Anglia Ruskin University, Chelmsford, CM1 1SQ, UK); Rangan Gupta (Department of Economics, University of Pretoria, Private Bag X20, Hatfield 0028, South Africa); Qiang Ji (Institutes of Science and Development, Chinese Academy of Sciences, Beijing, China; School of Public Policy and Management, University of Chinese Academy of Sciences, Beijing, China) |
| Abstract: | We analyse the impact of oil supply, global economic activity, oil-specific consumption demand, and oil inventory demand shocks on expected aggregate skewness of the United States (US) economy, obtained based on a data-rich environment involving 211 macroeconomic and financial variables over the quarterly period of 1975:Q1 to 2022:Q2. We find that positive oil supply and global economic activity shocks increase the expected macroeconomic skewness in a statistically significant manner, with the effects being relatively more pronounced in the lower-regime of the aggregate skewness factor, i.e., when the US is witnessing downside risks. Interestingly, oil-specific consumption demand and oil inventory demand shocks contain no predictive ability for the overall expected skewness. With skewness being a metric for policymakers to communicate their beliefs about the path of future risks, our results have important implications for policy decisions. |
| Keywords: | Oil shocks, Expected macroeconomic skewness, US economy, Local projection model, Impulse response functions |
| JEL: | C23 D81 Q41 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:pre:wpaper:202302&r=ene |
| By: | Mark Budolfson (Department of Philosophy, Rutgers University); Francis Dennig (Yale-NUS College); Frank Errickson (Princeton's Woodrow Wilson School of Public and International Affairs - Princeton University); Simon Feindt (MCC - Mercator Research Institute on Global Commons and Climate Change - PIK - Potsdam Institute for Climate Impact Research); Maddalena Ferranna (Harvard School of Public Health); Marc Fleurbaey (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement); David Klenert (JRC - European Commission - Joint Research Centre [Seville]); Ulrike Kornek (Kiel University); Kevin Kuruc (OU - University of Oklahoma); Aurélie Méjean (CNRS - Centre National de la Recherche Scientifique); Wei Peng (Penn State - Pennsylvania State University - Penn State System); Noah Scovronick (Emory University [Atlanta, GA]); Dean Spears (University of Texas at Austin [Austin]); Fabian Wagner (IIASA - International Institute for Applied Systems Analysis [Laxenburg]); Stéphane Zuber (PSE - Paris School of Economics - UP1 - Université Paris 1 Panthéon-Sorbonne - ENS-PSL - École normale supérieure - Paris - PSL - Université Paris sciences et lettres - EHESS - École des hautes études en sciences sociales - ENPC - École des Ponts ParisTech - CNRS - Centre National de la Recherche Scientifique - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement, CES - Centre d'économie de la Sorbonne - UP1 - Université Paris 1 Panthéon-Sorbonne - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | Existing estimates of optimal climate policy ignore the possibility that carbon tax revenues could be used in a progressive way; model results therefore typically imply that near-term climate action comes at some cost to the poor. Using the Nested Inequalities Climate Economy (NICE) model, we show that an equal per capita refund of carbon tax revenues implies that achieving a 2 °C target can pay large and immediate dividends for improving well-being, reducing inequality and alleviating poverty. In an optimal policy calculation that weighs the benefits against the costs of mitigation, the recommended policy is characterized by aggressive near-term climate action followed by a slower climb towards full decarbonization; this pattern—which is driven by a carbon revenue Laffer curve—prevents runaway warming while also preserving tax revenues for redistribution. Accounting for these dynamics corrects a long-standing bias against strong immediate climate action in the optimal policy literature. |
| Date: | 2021–12 |
| URL: | http://d.repec.org/n?u=RePEc:hal:cesptp:halshs-03462773&r=ene |
| By: | Brown, David P. (University of Alberta, Department of Economics); Eckert, Andrew (University of Alberta, Department of Economics); Shaffer, Blake (University of Calgary) |
| Abstract: | Asset divestitures play a central role in antitrust and competition policy. Despite their importance, empirical evidence on their impacts on market competition is limited. We analyze market power in Alberta's wholesale electricity market, where transitional arrangements that virtually divested generation assets from large incumbents were put in place during market restructuring in the early 2000's and expired at the end of 2020. Subsequently, average peak hour prices rose by 120% the year after their expiry. We demonstrate that nearly two-thirds of this increase can be explained by elevated market power from the large suppliers. Further, exploiting variation in the allocation of the divested assets across heterogeneous firms, we demonstrate that market power execution is elevated when the divested assets are controlled by large strategic firms. Our findings highlight the important role that asset divestitures and their allocations can have on market competition. Our analysis also raises concerns over the ability of restructured electricity markets to facilitate sufficient competition through entry and the potential need for regulatory intervention. |
| Keywords: | Electricity; Market Power; Competition Policy; Divestitures |
| JEL: | D43 L13 L50 L94 Q40 |
| Date: | 2023–01–29 |
| URL: | http://d.repec.org/n?u=RePEc:ris:albaec:2023_002&r=ene |
| By: | Löschel, Andreas; Price, Michael Keith; Razzolini, Laura; Werthschulte, Madeline |
| Abstract: | We examine the impact of the COVID-19 pandemic on the formation of energy conservation routines. To do so, we use data from two nationwide surveys of German households, conducted before and during the pandemic. Across the two survey waves, we document a significant increase in the likelihood respondents report engaging in a variety of energy conservation routines, such as unplugging electronic appliances after use and switching off lights when leaving a room. To understand what drives this result, we provide evidence that observed energy saving actions reflect an increased attention devoted to energy consumption while staying at home, as opposed to income shocks experienced during the pandemic. We also rule out an increase in pro-environmental concern during the pandemic as driver of our results. Rather, we find evidence consistent with a 'finite pool of worry, ' that might have even limited the impact of increased attention on the adoption of energy saving routines. In sum, our findings highlight the importance of consumer attention for the adoption of conservation routines to fight global climate change in a post-pandemic world. |
| Keywords: | Energy conservation routines, COVID-19, income shocks, attention, nationwide surveys |
| JEL: | D91 Q49 C83 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:zbw:zewdip:22068&r=ene |
| By: | Marie-Clotilde Meillerand (LAET - Laboratoire Aménagement Économie Transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique); Jean-Pierre Nicolas (LAET - Laboratoire Aménagement Économie Transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique); Sébastien Gardon (Territoires - Territoires - AgroParisTech - VAS - VetAgro Sup - Institut national d'enseignement supérieur et de recherche en alimentation, santé animale, sciences agronomiques et de l'environnement - INRAE - Institut National de Recherche pour l’Agriculture, l’Alimentation et l’Environnement - UCA - Université Clermont Auvergne) |
| Abstract: | The sharp fluctuations in energy prices over the past 20 years have made some households precarious because of their situation linked to their income, a poorly isolated housing and/or long daily commutes. This theme of energy poverty has thus gradually emerged as an object of local public action by strengthening significantly with the price peak of of oil in 2008-2012. How can the local stakeholders organize themselves to face this social issue of the energy transition? To answer this question, this article reports on a research conducted in three different territories, active in the fight against energy poverty related to housing and mobility. It shows the gradual intensification of collective action in this area since the 2000s, and highlights limits of sectoral policies (social action, energy, housing, transport, etc.), and on the other hand the current financing and regulation methods that make it difficult to conduct long term actions. Finally, the observations on the three territories show the opportunities of the ongoing institutional developments over the past ten years (intercommunality and metropolization). |
| Abstract: | Les fortes variations des prix de l'énergie depuis 20 ans ont précarisé certains ménages vulnérables du fait de leur revenu, d'un logement mal isolé ou de longs déplacements quotidiens contraints. Cette thématique de la précarité énergétique a ainsi progressivement émergé en tant qu'objet de l'action publique territoriale en se renforçant nettement avec le pic du prix du pétrole en 2008-2012. Comment les acteurs des territoires peuvent-ils s'organiser pour faire face à cet enjeu social de la transition énergétique ? Pour répondre à cette question, cet article rend compte d'une recherche menée auprès de trois territoires différenciés, actifs en matière de lutte contre la précarité énergétique liée au logement et à la mobilité. Il montre l'intensification progressive de l'action collective en la matière depuis les années 2000, tout en soulignant les limites d'une part des politiques sectorielles (action sociale, énergie, logement, transports…), et d'un autre côté des modes de financement et de régulation actuels qui rendent difficiles de mener des actions de long terme. Enfin, les observations sur les trois territoires témoignent des opportunités que peuvent offrir les évolutions institutionnelles en cours depuis une dizaine d'années (intercommunalité et métropolisation). |
| Keywords: | Energy poverty, Housing, Daily mobility, Transversality, Territorial public action, Précarité énergétique, Logement, Mobilité quotidienne, Transversalité, Action publique territoriale |
| Date: | 2023 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-03917910&r=ene |
| By: | Yoo, Yiseon (Korea Institute for Industrial Economics and Trade); Lee, Jaeyoon (Korea Institute for Industrial Economics and Trade) |
| Abstract: | As social interest in particulate matter (PM) increases, various abatement policies are being discussed and implemented. However, such a policy could lead to economic burdens for industries that emit large amounts of PM. For example, if we aim to limit PM emissions from industrial production processes, cutting production or installing abatement devices incurs costs. Of course in the long run it may be possible to comply with regulations without additional costs through the development of new technologies. However, assuming that firms are currently producing at an optimal level, additional regulations increase costs in the short run. In industries already subject to environmental regulations, including an emissions trading system (ETS) for achieving national greenhouse gas reduction targets, stringent regulations on PM emissions could be an additional burden. The sources of domestic PM emissions can be categorized into four sectors: power generation, industry, transportation, and households. The emissions from the industrial sector accounts for about 40 percent of total domestic emissions. Therefore the role of industry is most important in curbing PM emissions. Despite this, there is a lack of both academic and policy research discussing issues regarding industrial PM emissions. This study investigates the current state of PM emissions in manufacturing industries and corporate perceptions of government regulations on PM emissions, and further estimates the macroeconomic effect of relevant policies. The results and implications of this study are expected to contribute to improving the efficiency of PM abatement policies. |
| Keywords: | PM emissions; fine dust; environmental regulations |
| JEL: | Q51 Q53 Q58 |
| Date: | 2023–01–08 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kieter:2019_022&r=ene |
| By: | Rüdiger Bachmann; David Baqaee; Christian Bayer; Moritz Kuhn; Andreas Löschel; Ben McWilliams; Benjamin Moll; Andreas Peichl; Karen Pittel; Moritz Schularick; Georg Zachmann |
| Abstract: | An end to gas supplies from Russia has recently become much more likely. Russian supply volumes have already been substantially reduced, and uncertainty about future supplies and the winter supply situation is high. In this study, we ask what the economic consequences would be of a complete halt to Russian gas imports at present (August 2022). Almost five months have passed since our first study, "What if" (Bachmann et al., 2022), on the economic effects of a March 2022 Russian energy import freeze. The debate sparked by the study has sharpened the focus on the issues and assumptions that are critical to estimating the economic costs of a Russian energy import freeze. In this study, we update the results based on the situation in August 2022. (i) We estimate the necessary demand reduction that would result if Russian gas imports were halted from August 2022 and discuss economic policy strategies to achieve this adjustment. (ii) We update our estimated expected economic costs and discuss practical examples of substitution options in the industrial sector. (iii) We evaluate the federal government's economic policy, in particular its decision to increase storage levels with continued gas imports from Russia since March 2022, but to largely forego measures to reduce gas demand in power generation, industry, and residential and commercial sectors. The key findings of the study can be summarized as follows: In the event of a complete loss of Russian gas supplies in the next few weeks, Germany will have to reduce its gas demand by around 25% (equivalent to 210 TWh) by the end of the coming heating period (April 2023), even if the planned liquefied natural gas terminals come on stream as planned in the winter. When factoring in the savings in gas demand that can be achieved through alternative energy sources in power generation, this leaves an adjustment of about 20% of gas consumption that must be borne by industry, households, businesses, and the public sector. Such a reduction is feasible in a collective effort if measures are taken quickly to save gas. The good news from our study is that Germany can get through the winter without Russian gas. Panic mongering is out of place. Nevertheless, it should be clear to everyone that the Russian invasion of Ukraine has made Germany permanently poorer. The days of cheap energy are over and collective efforts are needed to make the economy crisis-proof. Reducing gas consumption is feasible, but it comes at an economic cost. In particular, there is much less time now to substitute gas in the industrial sector and power generation than in the spring. It is difficult to estimate how many companies have made the sometimes costly investments in alternatives even without the appropriate political framework. However, it has become clear that the view that gas substitution was not possible at all within six months was wrong. There are now numerous examples of substantial substitution possibilities, including in the chemical and glass production industries. The bottom line is that the economic costs of adjusting to an import freeze are likely to remain similar to those of committing to an import freeze already in the spring. This is because the gas gap is smaller than in the spring, but the remaining adjustment period is shorter. In this respect, the costs remain substantial, but manageable with appropriate economic policy measures. There is no threat of mass poverty or popular uprisings in the event of a halt to Russian gas imports. The economy will face production losses of a magnitude that Germany has already managed in the past when it had to face economic shocks. It is also important to interpret the effects of a gas import stop relative to a scenario without an import stop. For example, Germany could fall into recession even without an import freeze. The assessment of the German government's strategy of not enforcing an early demand adjustment and continuing gas imports from Russia despite the war of aggression on Ukraine is ambivalent. Although a good 100 TWh of gas was stored from April to July, without Russian supplies the need for adjustment on the demand side remains substantial at 25% until the end of the next heating period. In a counterfactual scenario, in which Germany would have had to manage without Russian gas imports as early as from April onwards, demand would have had to be reduced by 31%, a good 6 percentage points more. Yet in return, there would have been more time to prepare the appropriate adjustments for the winter heating period. Even if the storage facilities were filled to 100% in the fall, Germany would remain dependent on Russian imports for normal winter consumption and would thus remain vulnerable to blackmail from Moscow. This is because the storage facilities only have a total capacity of below 250 TWh, which is roughly equivalent to the consumption of two winter months. In this respect, the focus on storage levels and the neglect of adaptation measures was not suitable to end Germany's dependence on Russia and its political blackmail ability completely and quickly. While closer cooperation with European partners could have mitigated the necessary reduction in gas demand in Germany, there is still a risk that national go-it-alone efforts will undermine essential European energy solidarity. In any case, the BMWK's efforts to build LNG terminals and diversify gas supplies through imports from third countries are positive. However, this could have been done even with an import freeze or tariff solutions in March. |
| Date: | 2022–08 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkpbs:034_en&r=ene |
| By: | Cho, Yongwon (Korea Institute for Industrial Economics and Trade) |
| Abstract: | Private oil companies in Korea such as GS Caltex, S-Oil and Hyundai Oilbank have recently announced plans to invest in petrochemical production facilities and have begun entering the chemical market in earnest. These investments include building a Naphtha Cracking Center (NCC) where naphtha, a product made at existing refining facilities, is used as a raw material to produce ethylene products. As private oil companies have started entering the petrochemical market in Korea, both the supply of petrochemical products and the demand for increased production capacity are expected to rise. Forward integration of chemical businesses led by refineries is a common sight not only in the domestic but also in the global petrochemical market. This trend is attributed to a decline in profit margins at traditional oil companies, along with a rise in demand for upstream petrochemical products due to the global economic recovery. In addition, Saudi Arabia and the United Arab Emirates have shifted their energy development policy from existing refineries to vertical integration, covering the petrochemical businesses. It is believed that this will boost demand for plants. Since 2016, global crude oil prices have risen, leading to improved financial conditions at major oil producers and a reduced cost burden for the construction of petrochemical production facilities. As a result, the demand for petrochemical plant orders is expected to increase. In fact, the Downstream Capital Cost Index (DCCI), which tracks capital expenses for the construction of refining facilities and petrochemical production facilities, was most recently at 182, reflecting a drop from 2004 to 2005 levels, when plant orders surged. As oil companies have started entering the global petrochemical market, the demand for plants has increased. This is a new opportunity for the Korean plant industry. Therefore, it is timely to analyze the causes and types of oil companies’ entry into the chemical market and identify the impact on and opportunities for the Korean plant industry. This study aims to predict the impact on the demand for petrochemical plants caused by global oil companies’ strategies to invest in the vertical integration. It is hoped that this study is used as a basic guide for the domestic plant industry to come up with measures to respond in the future. |
| Keywords: | petrochemicals; oil; petrochemical industry |
| JEL: | L64 L65 |
| Date: | 2023–01–08 |
| URL: | http://d.repec.org/n?u=RePEc:ris:kieter:2019_013&r=ene |
| By: | Evdokia Moïsé; Stela Rubínová |
| Abstract: | Affordable and sustainable lithium-ion batteries are key to the development of electric vehicles markets and to the green energy transition. Circular economy solutions for end-of-life batteries can help address primary inputs disruptions, while reducing environmental costs associated with the mining of these inputs or with battery production. Circular value chains would also help address waste and disposal problems as Li-ion batteries reach end of life. These chains are in their infancy, as complex battery designs, material chemistries and insufficient waste stocks hamper their viability, but the projected growth should support profitability. International trade in Li-ion batteries waste will remain essential in markets where domestic waste streams are insufficient to achieve the scale necessary for economically viable recycling, or where inadequate infrastructure imposes reliance on recycling capacities abroad. Promoting circular value chains for Li-ion batteries would require greater clarity on the status of these batteries as waste, consistency of transport and storage safety regulations, trade facilitation and harmonisation of standards for battery design, and regulatory targets for waste collection and recycling rates, coupled with stewardship and take-back schemes. |
| Keywords: | Critical raw materials, Electric vehicles, Green transition, Hazardous waste |
| JEL: | F18 F53 F68 K32 O34 Q38 Q53 Q56 |
| Date: | 2023–01–30 |
| URL: | http://d.repec.org/n?u=RePEc:oec:traaaa:2023/01-en&r=ene |
| By: | Glauber, Joseph |
| Abstract: | Recent attention has focused on "repurposing" and redirecting agricultural support programs towards achieving environmental, climate and nutritional outcomes. Under these proposals, typically equivalent levels of subsidies and other forms of government support would be focused on the reducing GHG emissions, environmental externalities and other broader public policy objectives such as improving nutrition. But questions arise as to whether new support programs would necessarily be consistent with WTO disciplines. This paper examines various measures aimed at reducing GHG emissions including imposition of carbon standards and taxes, border measures to reduce slippage, and so-called "Climate Smart" domestic support measures and considers how such measures comport with WTO trade rules. |
| Keywords: | agriculture; climate change; climate change adaptation; greenhouse gas emissions; nutrition; subsidies; WTO; agricultural support programs; carbon border adjustment measures; product standards |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:fpr:ifprid:2164&r=ene |
| By: | Tiago Cavalcanti; Kamiar Mohaddes; Hongyu Nian; Haitao Yin |
| Abstract: | This paper investigates the long-run effects of prolonged air pollution on firm-level human capital, knowledge and innovation composition. Using a novel firm-level dataset covering almost all industrial firms engaged in science and technology activities in China, and employing a regression discontinuity design, we show that prolonged pollution significantly diminishes both the quantity and the quality of human capital at the firm level. More specifically, we show that air pollution affects firm-level human capital composition by reducing the share of employees with a PhD degree and master’s degree, but instead increasing the share of employees with bachelor’s degree. Moreover, the difference in the composition of human capital materially change the knowledge and innovation structure of the firms, with our estimates showing that pollution decreases innovations that demand a high level of creativity, such as publications and inventions, while increasing innovations with a relatively low level of creativity, such as design patents. Quantitatively, on the intensive margin, one μg/m3 increase in the annual average PM2.5 concentration leads to a 0.188 loss in the number of innovations per R&D employee. Overall, we show that air pollution has created a gap in human capital, knowledge, and innovation between firms in the north and south of China, highlighting the importance of environmental quality as a significant factor for productivity and welfare. |
| Keywords: | Pollution, human capital, knowledge, innovation and China |
| JEL: | O15 O30 O44 Q51 Q56 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:een:camaaa:2023-01&r=ene |
| By: | Teodora Boneva; Armin Falk; Mark Fallak; Lasse Stötzer |
| Abstract: | According to a representative briq survey, two-thirds of the German population would be willing to pay hig- her prices for gas and heating if this were to increase pressure on the Russian government. Four out of five Germans would lower their room temperature to save energy. And more than half of higher-income house- holds would be willing to spend some of their income to help poorer households cope with higher energy prices. |
| Date: | 2022–04 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkpbs:030_en&r=ene |
| By: | Yuanrong Wang; Vignesh Raja Swaminathan; Nikita P. Granger; Carlos Ros Perez; Christian Michler |
| Abstract: | The Dutch power market includes a day-ahead market and an auction-like intraday balancing market. The varying supply and demand of power and its uncertainty induces an imbalance, which causes differing power prices in these two markets and creates an opportunity for arbitrage. In this paper, we present collaborative dual-agent reinforcement learning (RL) for bi-level simulation and optimization of European power arbitrage trading. Moreover, we propose two novel practical implementations specifically addressing the electricity power market. Leveraging the concept of imitation learning, the RL agent's reward is reformed by taking into account prior domain knowledge results in better convergence during training and, moreover, improves and generalizes performance. In addition, tranching of orders improves the bidding success rate and significantly raises the P&L. We show that each method contributes significantly to the overall performance uplifting, and the integrated methodology achieves about three-fold improvement in cumulative P&L over the original agent, as well as outperforms the highest benchmark policy by around 50% while exhibits efficient computational performance. |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2301.08360&r=ene |
| By: | Rüdiger Bachmann (University of Notre Dame); David Baqaee (University of California, Los Angeles); Christian Bayer (University of Bonn); Moritz Kuhn (University of Bonn); Andreas Löschel (Ruhr University Bochum); Benjamin Moll (London School of Economics); Andreas Peichl (Ifo Institute for Economic Research, University of Munich); Karen Pittel (Ifo Institute for Economic Research, University of Munich); Moritz Schularick (Sciences Po Paris, University of Bonn) |
| Abstract: | This article discusses the economic effects of a potential cut-off of the German economy from Russian energy imports. We show that the effects are likely to be substantial but manageable. In the short run, a stop of Russian energy imports would lead to a GDP decline in range between 0.5% and 3% (cf. the GDP decline in 2020 during the pandemic was 4.5%). |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkpbs:028&r=ene |
| By: | Ibrahim Savadogo (LAET - Laboratoire Aménagement Économie Transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique); Adrien Beziat (LAET - Laboratoire Aménagement Économie Transports - UL2 - Université Lumière - Lyon 2 - ENTPE - École Nationale des Travaux Publics de l'État - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | This paper assesses the potential environmental impacts of a large-scale deployment of off-hour deliveries (OHD), focusing on CO2 and pollutant emissions. We use a methodological framework involving four steps: transport demand estimation, traffic simulation, emissions calculation and emissions environmental social cost calculation. Based on five scenarios, depending on the scale of the shift to OHD, and applied to the case of the Lyon urban area, we find that OHDs lead to a reduction in CO2 and pollutant emissions. However, their impact is rather small. The maximum reduction in CO2 emissions is 3.4% for 100% OHD for the whole urban area of Lyon (1.9 million inhabitants and 3325 km2). Some factors (population size, density, traffic conditions, research methodology, vehicle fleet composition, etc.) limit the comparability of the results obtained from other case studies. One of the reasons for this low environmental impact of OHDs is that the LUA is a small and not very congested metropolitan area. This impact is 5% when we focus on the densest area (core of area with 0.7 million inhabitants on 2.2% of surface area) which is more important than in the least dense area (outskirts of area with 0.6 million inhabitants on 83.6% of surface area) with 2.6%. These results confirm the limited impacts of OHDs in smaller, less congested urban areas. It also reaffirms the need for OHDs to be implemented in the densest parts of metropolitan areas. The maximum decrease in the environmental social cost is 4.25 million euros per year. Furthermore, the analysis reveals that the adoption of OHD makes it possible to achieve gains of 2.5 million hours per year in travel time that augur a productivity gain for all the actors involved in urban goods movement. |
| Keywords: | Off-hour deliveries, Urban goods movements, Environmental impacts, Large-scale simulation |
| Date: | 2021–01 |
| URL: | http://d.repec.org/n?u=RePEc:hal:journl:halshs-03045859&r=ene |
| By: | Di Bartolomeo Giovanni; Saltari Enrico; Semmler Willi |
| Abstract: | We study the dynamic problem of pollution control enacted by some policies of regulation and mitigation. The transition dynamics from one level of regulation and mitigation to another usually involve inter-temporal trade-offs. We focus on how different policymaker’s time horizons affect these trade-offs. We refer to shorter lengths in policymaker’s time horizons as political short-termism or inattention, which is associated with political econ-omy or information constraints. Formally, inattention is modeled by using Nonlinear Model Predictive Control. Therefore, it is a dynamic concept: our policymakers solve an inter-temporal decision problem with a finite horizon that involves the repetitive solution of an optimal control problem at each sampling instant in a receding horizon fashion. We find that political short-termism substantially affects the transition dynamics. It leads to quicker but costlier transitions. It also leads to an under-evaluation of the environmental costs that may accelerate climate change. |
| Date: | 2022–11 |
| URL: | http://d.repec.org/n?u=RePEc:ter:wpaper:00154&r=ene |
| By: | Teichgraeber, Andreas; Van Reenen, John |
| Abstract: | What research and innovation (R&I) policies should Europe adopt? The world faces a challenge to rebuild after the pandemic, but also faces the same structural slowdown of productivity growth that occurred in the decades before the COVID crisis. We need to have a plan around innovation policy to address the challenge. We show that Europe is less innovative on many dimensions compared to other advanced regions, such as the US and parts of Asia. We review the econometric evidence on R&I policies and argue that there is good evidence for the efficacy of many of them. A mix of R&D subsidies, reinvigorated competition and a big push on expanding the quantity and quality of human capital is needed. These could be bound together around the need for green innovation in order to achieve the mission to radically reduce carbon emissions. |
| Keywords: | innovation; R&D; human capital; Europe |
| JEL: | O31 O32 J24 |
| Date: | 2022–02–25 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:117801&r=ene |
| By: | Christina Brand (Institute of Transport Economics, Muenster); Thomas Hagedorn (Institute of Transport Economics, Muenster); Till Kösters (Institute of Transport Economics, Muenster); Marlena Meier (Institute of Transport Economics, Muenster); Gernot Sieg (Institute of Transport Economics, Muenster); Jan Wessel (Institute of Transport Economics, Muenster) |
| Abstract: | The Leezenflow system is an open-source green wave assistant designed specifically for cyclists and is installed 110 meters in front of a traffic light in Münster, Germany. The system indicates the remaining time of the current traffic light phase through an expiring bar, colored either green or red. This is intended to help cyclists adjust their speed in order to cross the traffic lights when green, and consequently optimize cycling flow. We conduct a natural field experiment in real traffic to analyze the impact of the Leezenflow system on cycling flow and safety, and find that it impacts statistically significantly on cycling flow. Due to the Leezenflow system, the number of cyclists that have to stop at the red lights decreases by 6.6 %. Accordingly, the share of cyclists that pass the green lights increases. The data also indicate positive effects on traffic safety. The results of the natural field experiment confirm and put into perspective the feedback of an accompanying online survey. The majority of surveyed users reports that the Leezenflow system does improve the cycling flow. The influence on traffic safety is predominantly seen as positive or neutral by the survey participants. The Leezenflow system can thus help city planners to promote cycling, thereby enabling more sustainable mobility. |
| Keywords: | Bicycle traffic flow, traffic safety, open-source green wave assistant, countdown timer, natural field experiment, survey |
| JEL: | R49 C93 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:mut:wpaper:37&r=ene |
| By: | Andres, Pia-Katharina |
| Abstract: | Countries around the world increase the downstream cost of low carbon technologies using anti-dumping duties and local content requirements, while simultaneously blaming inadequate efforts to address climate change on the economic cost of doing so. This paper presents a 2-country, 2-period strategic model of trade in a clean technology in the presence of differential country-level production costs and imperfect competition. If the difference in production cost is large enough and learning-by-doing allows the laggard country to catch up, then in the absence of production subsidies remaining in autarky during Stage 1 of the game can be welfare-improving for both countries. This result is strengthened when both countries use consumer subsidies. When countries choose their policy mixes, the Nash Equilibrium involves both trade and production subsidies on the part of the laggard country. The analysis suggests that an environmental trade agreement is most likely to be beneficial if production subsidies for clean technology are explicitly permitted. |
| JEL: | R14 J01 J1 |
| Date: | 2023–01–09 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:117899&r=ene |
| By: | Abdeljelil, Mouna Ben (University of Sousse); Rault, Christophe (University of Orléans); Belaïd, Fateh (Lille Catholic University) |
| Abstract: | This paper investigates the existence of an environmental Kuznets curve (EKC) and its robustness for 28 countries of the Union for the Mediterranean (UfM) over the recent period. Our methodology relies on four recent estimation methods for non-stationary panel data and includes four pollutants (two global and two local). Two main results emerge from our analysis. First, the EKC does not hold for most pollutants, and its validity crucially depends on the estimation techniques considered. Second, the Pooled-Mean Group method is the most favourable one and confirms the existence of an inverted U-shaped relationship for CO2 and SO2. Our results provide beneficial information for decision-makers. They suggest implementing proactive instruments based on both flexible regulations and tax incentives to stimulate ecological transition. |
| Keywords: | environmental Kuznets curve, pollution, regional integration, The Union for the Mediterranean |
| JEL: | O44 Q53 R58 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:iza:izadps:dp15853&r=ene |
| By: | van der Ploeg, Frederick; Emmerling, Johannes; Groom, Ben |
| Abstract: | An analytical formula is presented for the Social Cost of Carbon (SCC) taking account of intragenerational income inequality, in addition to intergenerational income inequality, macro-economic uncertainty and rare disasters to economic growth. The social discount rate is adjusted for intra- and intergenerational inequality aversion and risk aversion. If growth reduces intragenerational inequality, the SCC is lower than with inequality-neutral growth, especially if intra- and intergenerational inequality aversion are high. Calibrated to the observed interest rate and risk premium, the SCC in 2020 is $125/tCO2 without considering intragenerational inequality, $81/tCO2 if intragenerational inequality decreases over time, as a continuation of historical trends suggests (based on Shared Socioeconomic Pathway (SSP) 2), and $213/tCO2 if inequality increases (SSP4). Intragenerational inequality has a similar order of effect on the SCC as accounting for rare macroeconomic disasters. |
| Keywords: | social discount rate; social cost of carbon; intra- and intergenerational inequality aversion; risk aversion; inequality; growth; uncertainty |
| JEL: | C61 D31 D62 D81 G12 H23 Q54 |
| Date: | 2023–01–10 |
| URL: | http://d.repec.org/n?u=RePEc:ehl:lserod:117901&r=ene |
| By: | Pietro Bonetti; Christian Leuz; Giovanna Michelon |
| Abstract: | The rise of shale gas and tight oil development has triggered a major debate about hydraulic fracturing (HF). In an effort to mitigate risks from HF, especially with respect to water quality, many U.S. states have introduced disclosure mandates for HF wells and fracturing fluids. We use this setting to study whether targeting corporate activities that have dispersed environmental externalities with disclosure regulation to create public pressure reduces their environmental impact. We find significant improvements in water quality, examining salts that are considered signatures for HF impact, after the disclosure mandates are introduced. We document effects along the extensive and the intensive margin, though most of the improvement comes from the latter. Supporting this interpretation, we find that, after the disclosure mandates, operators pollute less per unit of production, use fewer toxic chemicals, and cause fewer spills and leaks of HF fluids and wastewater. We also show that disclosure enables public pressure and that this pressure facilitates internalization. |
| JEL: | D62 G38 K22 K32 L71 L72 M41 M48 Q53 |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:nbr:nberwo:30842&r=ene |
| By: | Nenovska, Nona; Magnin, Eric; Nenovsky, Nikolay |
| Abstract: | This article aims to rediscover an author relatively unknown to the general public, Slavcho Zagorov, and revive his ideas. Zagorov is a Bulgarian economist and statistician whose main works date from 1954 and are mainly devoted to the concept of energy flow in the economy and human metabolism, explained through the prism of thermodynamics. Criticizing the mainstream economic approach to national income in terms of "value", he developed a new approach of "national income movement". According to Zagorov, national income is "energy movement", which he calculates in terms of primary energy sources. He draws conclusions from direct observations on the economic development of the Danube countries. |
| Keywords: | B31, B30, N01 , Q43, Q5 |
| JEL: | B30 B31 N01 Q40 Q43 Q50 |
| Date: | 2022–09–15 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:115938&r=ene |
| By: | Teodora Boneva; Armin Falk; Mark Fallak; Lasse Stötzer |
| Abstract: | Knapp 70 Prozent der 2.000 Befragten gaben an, einen Importstopp für Gas, Öl und Kohle aus Russland zu unterstützen. Drei von vier Deutschen sind dafür, Vermögenswerte von Personen aus dem Umfeld Putins zu beschlagnahmen und damit die wirtschaftlichen Folgen der Sanktionen für Deutschland abzufedern. Um die Abhängigkeit von Energieimporten nachhaltig zu reduzieren, sprechen sich 90 Prozent für einen beschleunigten Ausbau der erneuerbaren Energien aus. Für den Übergang würden drei Viertel der Deutschen eine Laufzeitverlängerung der verbliebenen Atomkraftwerke akzeptieren, 63 Prozent eine vorübergehende Intensivierung des Braunkohleabbaus. Darüber hinaus würde eine Mehrheit der Deutschen verschiedene Maßnahmen zur Senkung des Kraft- stoffverbrauchs im Straßenverkehr unterstützen: 61 Prozent der Befragten halten ein zunächst für sechs Mo- nate geltendes Tempolimit von 100 km/h auf deutschen Autobahnen für vertretbar. Knapp mehrheitsfähig mit 53 Prozent Zustimmung wäre auch die Wiedereinführung autofreier Sonntage. Vier von fünf Deutschen könnten sich zudem eine teilweise Verlängerung der Homeoffice-Pflicht vorstellen. Zusätzliche Waffenlieferungen an die Ukraine sehen allerdings viele Deutsche skeptisch, nur die Hälfte der Befragten wäre damit einverstanden. Politische Unterstützung für einen EU-Beitritt der Ukraine halten 56 Prozent für geboten. Eine breite Rückendeckung von 70 Prozent der Deutschen findet der Vorschlag, die Integration von Geflüchteten aus der Ukraine durch eine unbefristete Aufenthalts- und Arbeitserlaubnis zu erleichtern. |
| Date: | 2022–03 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkpbs:031&r=ene |
| By: | Peter Cramton; François Lévêque; Axel Ockenfels; Steven Stoft |
| Abstract: | “Instead of outbidding each other and driving prices up, ” on 25 March, the 27 EU nations decided to “pool [their] purchasing power” for the “voluntary common purchase of gas”. In short, they decided to form a buyers’ cartel. So far, difficulties have been identified, but what is needed is a systematic design effort addressing those difficulties. This column proposes a simple, but fairly comprehensive framework for an EU gas-purchasing cartel. |
| Date: | 2022–05 |
| URL: | http://d.repec.org/n?u=RePEc:ajk:ajkpbs:033&r=ene |
| By: | Marc Germain (LEM - Lille économie management - UMR 9221 - UA - Université d'Artois - UCL - Université catholique de Lille - Université de Lille - CNRS - Centre National de la Recherche Scientifique) |
| Abstract: | In response to the unsustainable nature of current brown growth, the concept of green growth, supposedly compatible with the environment, has been proposed. However, a literature has developed around the unfeasibility of green growth and this article aims to contribute to it on the basis of a reasoning combining (i) the concept of creative destruction; (ii) the distinction between environmental limits, physical limits in the (very) long term and technological limits in the short-medium term; (iii) the description of the possible consequences of the limits on the trajectory of the economy The combination of environmental and physical limits means that indefinite growth (even green growth) in a finite world is impossible. In the long term, the economy can at best tend towards a stationary state. In the medium term, because of an impact effect (due to pollution) and a crowding-out effect (which diverts labor and capital from the production of goods and services), technological limits are likely not only to slow down growth but also to bring the economy into decline (at least transitorily). If innovations (including environmental ones) continually allow technological limits to be pushed back (with diminishing returns due to physical limits), they ultimately exacerbate the contradictions between growth and environmental limits. Far from being the solution, innovations are also the source of the problems because they are at the heart of the creative destruction at the basis of growth. Given the technological limits and the urgency induced by the fact that a number of environmental limits have already been exceeded at the global level, it is problematic, to say the least, to aspire to a transition from the current brown growth to a green growth in the coming decades. To replace brown growth, the alternative is not between green growth and degrowth, but between undergone degrowth and voluntary degrowth. |
| Abstract: | En réponse au caractère insoutenable de la croissance brune actuelle a été proposé le concept de croissance verte, supposée compatible avec l'environnement. Une littérature s'est cependant développée autour de l'infaisabilité de la croissance verte et cet article a pour but d'y contribuer sur la base d'un raisonnement combinant (i) le concept de destruction créatrice ; (ii) la distinction entre limites environnementales, limites physiques à (très) long terme et limites technologiques à court-moyen terme ; (iii) la description des possibles conséquences des limites sur la trajectoire de l'économie. La combinaison des limites environnementales et physiques impose qu'une croissance (même verte) indéfinie dans un monde fini est impossible. A long terme, l'économie peut au mieux tendre vers un état stationnaire. A moyen terme, à cause d'un effet d'impact (dû aux pollutions) et d'un effet d'éviction (qui détourne le travail et le capital de la production de biens et services), les limites technologiques sont susceptibles non seulement de ralentir la croissance mais aussi d'amener l'économie en décroissance (au moins transitoirement). Si les innovations (y compris environnementales) permettent continuellement de repousser les limites technologiques (avec des rendements décroissants à cause des limites physiques), elles exacerbent au final les contradictions entre croissance et limites environnementales. Loin de seulement constituer la solution, les innovations sont aussi la source des problèmes parce qu'elles sont inscrites au coeur de la destruction créatrice à la base de la croissance. Etant donné les limites technologiques et l'urgence induite par le fait que nombre de limites environnementales sont déjà dépassées au niveau mondial, ambitionner dans les prochaines décennies une transition de l'actuelle croissance brune vers une croissance verte est pour le moins problématique. Pour remplacer la croissance brune, l'alternative n'est pas entre croissance verte et décroissance, mais entre décroissance subie et décroissance choisie. |
| Keywords: | croissance verte, destruction créatrice, progrès technique, recyclage, limites à la croissance. |
| Date: | 2022–12–26 |
| URL: | http://d.repec.org/n?u=RePEc:hal:wpaper:hal-03913177&r=ene |
| By: | Canova, Luciano; Paladino, Giovanna |
| Abstract: | Since 2018 the awareness of sustainability issues and climate change has increased significantly, especially among the younger generation. The COVID-19 pandemic and the related shutdown of many economic activities contributed to raising concerns about the conservation of biodiversity, the environment, and personal economic well-being. In this study, we examine how members of Generation Z deal with issues related to environmental sustainability and personal money management. By using the technique of the principal component analysis, two synthetic indexes were computed from a set of variables associated with the answers to a questionnaire that investigates the approach to environmental and economic sustainability by a representative sample of 400 Italian youngsters aged between 13 and 18 years. The GREEN INDEX is the result of the aggregation of environmental practices while the MONEY INDEX represents habits in personal money management. They are used as dependent variables of linear, ordered probit, and bivariate probit regressions to detect how socio-demographic factors and personality characteristics are associated with sustainability awareness. Our results show the overall importance of character traits - such as curiosity and scrupulousness - in improving the level of awareness and the strong statistical association between attention to money management and a sense of responsibility toward the environment. This finding hints that working on one dimension may produce a positive spillover effect on the other, setting in motion a virtuous circle for policy implementation. |
| Keywords: | Sustainability, Environment, Financial Education, Gen Z |
| JEL: | D14 Q54 |
| Date: | 2023–01–11 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:115960&r=ene |
| By: | Mohammadi, Fazel; Bok, Rasoul; Hajian, Masood |
| Abstract: | In this paper, the validation and performance testing of a control scheme for a single-phase single-stage transformerless grid-connected Photovoltaic (PV) inverter are presented using the Control-Hardware-in-the-Loop (C-HIL) implementation. The control scheme uses the DC-link voltage controller and grid current controller, and it is executed in a LAUNCHXL-F28379D development kit, providing a cost-effective solution compared to commercially available tools. In order to extract the maximum available power from the PV system under different conditions, two Maximum Power Point Tracking (MPPT) algorithms, including the Perturb and Observe (P&O) algorithm and incremental conductance method, are investigated and compared. The simulation and experimental results are provided to verify the performance of the studied control scheme. |
| Keywords: | Controller-Hardware-in-the-Loop (C-HIL); Digital Control; Grid-Connected Inverter; Maximum Power Point Tracking (MPPT) Algorithm; Photovoltaic (PV) Systems; |
| JEL: | Y90 |
| Date: | 2022 |
| URL: | http://d.repec.org/n?u=RePEc:pra:mprapa:115985&r=ene |
| By: | Yuanrong Wang; Yinsen Miao; Alexander CY Wong; Nikita P Granger; Christian Michler |
| Abstract: | Deep Reinforcement Learning (Deep RL) has been explored for a number of applications in finance and stock trading. In this paper, we present a practical implementation of Deep RL for trading natural gas futures contracts. The Sharpe Ratio obtained exceeds benchmarks given by trend following and mean reversion strategies as well as results reported in literature. Moreover, we propose a simple but effective ensemble learning scheme for trading, which significantly improves performance through enhanced model stability and robustness as well as lower turnover and hence lower transaction cost. We discuss the resulting Deep RL strategy in terms of model explainability, trading frequency and risk measures. |
| Date: | 2023–01 |
| URL: | http://d.repec.org/n?u=RePEc:arx:papers:2301.08359&r=ene |