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In this paper, we have investigated the implications of the threshold effect of changes in FDI inflows for the nexus between energy consumption and economic growth in eight under-researched sub-Saharan African countries for the period 1971--2016. The countries are Benin, Congo, Kenya, Nigeria, Senegal, South Africa, Sudan, and Zambia. Using the lag-augmented VAR (LAVAR) model (corrected for cross-sectional dependence), we develop an empirical framework tightly linked to the endogenous growth model that allows for a threshold effect of changes (strength and weakness) in FDI inflows on the nexus. Our findings show that the FDI inflows matter for the causal link between energy consumption and economic growth in some countries, although, for the cross-section as a whole, our bootstrap simulation supports the neutrality hypothesis. The overall results suggest that an energy demand policy, such as an energy conservation policy, should not cause any significant adverse side-effects to economic growth in those sub-Saharan African countries. Policy implications of the threshold effect for the nexus for individual sub-Saharan African countries are also provided. [ABSTRACT FROM AUTHOR]

This paper investigates the impact of women's intra-household bargaining power on household cooking fuel choice. It further analyzes the determinants of household energy spending after the decision to use a given fuel has been made. The results reinforce the important role women play in the household cooking fuel choice and energy transition from traditional to modern fuel. In addition, income and education are found to be crucial factors that influence both household cooking fuel choice and energy expenditure. These findings imply that energy transition policies need to consider gender dimension and women's intra-household bargaining power. [ABSTRACT FROM AUTHOR]

In this paper, we investigate the determinants of decline in energy intensity in four Chinese industries—pulp and paper, cement, iron and steel, and aluminum. This paper attempts to answer the following key question: For the purpose of promoting energy efficiency, do prices, technology, enterprise restructuring and other policy-related instruments affect various sectors uniformly so as to justify uniform industrial energy conservation policies, or do different industries respond significantly differently so as to require policies that are tailored to each sector separately? In this paper, we examine this question using data for China's most energy-intensive large and medium-size enterprises over the period 1999-2004. Our results suggest that in all four industries rising energy costs are a significant contributor to the decline in energy intensity over our period of study. China's industrial policies encouraging consolidations and scale economies also seem to have contributed to reductions in energy intensity in these four industries. [ABSTRACT FROM AUTHOR]

Energy policy aims to reduce emissions at least long-run cost while ensuring reliability. Its effecacy depends on the cost of emissions reduced. Britain introduced an additional carbon tax (the Carbon Price Support, CPS) for fuels used to generate electricity that by 2015 added ₤18/t CO2, dramatically reducing the coal share from 41% in 2013 to 6% in 2018. Policies have both short and long-run impacts. Both need to be estimated to measure carbon savings. The paper shows how to measure the Marginal Displacement Factor (MDF, tonnes CO2 /MWh) for wind. The short-run (SR) MDF is estimated econometrically while the long-run (LR) MDF is calculated from a unit commitment model of the GB system in 2015. We examine counter-factual fuel and carbon price scenarios. The CPS lowered the SR-MDF by 7% in 2015 but raised the LR-MDF (for a 25% increase in wind capacity) by 18%. We discuss reasons for the modest differences in the SR- and LR-MDFs. [ABSTRACT FROM AUTHOR]

Many policies lead to the provision of incentives, such as rebates or tax credits, to consumers for the purchase of products that have high energy efficiency. This paper investigates how these incentives are distributed across income groups for three types of subsidies (manufacturer or retailer rebates, utility rebates, and tax credits) and eight types of equipment. While incentives are always concentrated in higher-income households, there is substantial heterogeneity in the magnitude of the concentration depending on how incentives are structured. Tax credits are the type of subsidy that is most concentrated in higher-income households and utility rebates are the least. Incentives for appliances that are not universally-owned, including dishwashers and clotheswashers, are more concentrated than are incentives for other types of equipment. Differences across income groups in the rates of equipment presence and turnover, willingness to purchase Energy Star models, and rates of homeownership contribute to the concentration. After controlling for these factors, utility rebates are no longer concentrated in higher-income households, but manufacturer / retailer rebates and tax credits remain so. [ABSTRACT FROM AUTHOR]

This paper explores how aspects of national culture may shape the design and implementation of public policy, using the example of energy policy in China. It focuses on cognitive style and on political and legal culture. China’s energy policies display a combination of pragmatism, incrementalism, internal contradiction and ambiguity. This is consistent with evidence from experimental psychology and history that the development of Chinese and East Asian cognitive styles have taken a path distinct from those of Western civilizations with their Greek philosophical heritage. These variations of cognitive style between cultures are reflected in brain function and genes. Policy implementation also bears features from imperial times in the political culture of China’s Communist Party and the contemporary legal system. These arguments reinforce existing calls for caution when seeking to transfer energy or other public policy approaches between countries with different cultures. [ABSTRACT FROM AUTHOR]

This paper examines the incentives embedded in different regulatory regimes for investment by utilities in energy efficiency programs that aim to reduce network losses. In our model, a monopolist chooses whether to undertake an investment in energy efficiency, which is not observable by the regulator. We show that, in equilibrium, the monopolist chooses to exert positive effort more often under price cap regulation than under no regulation or mandated target regulation and that she exerts no effort under rate of return regulation. This result contrasts with an extensive literature that focuses on end-user energy conservation and shows that price caps are ineffective for achieving energy efficiency as utilities have an incentive to maximize sales volume. Thus, policies that are designed to promote demand-side energy conservation may diminish the utilities' incentives to pursue supply-side energy efficiency through minimizing network losses. [ABSTRACT FROM AUTHOR]

The aim of this paper is to showcase different decarbonization pathways for Europe with varying Carbon dioxide (CO2) constraints until 2050. The Global Energy System Model (GENeSYS-MOD) framework, a linear mathematical optimization model, is used to compute low-carbon scenarios for 17 European countries or regions. The sectors power, lowand high-temperature heating, and passenger and freight transportation are included, with the model endogenously constructing capacities in each period. Emission constraints differ between different scenarios and are either optimized endogenously by the model, or distributed on a per-capita basis, GDP-dependent, or based on current emissions. The results show a rapid phase-in of renewable energies, if a carbon budget in line with established international climate targets is chosen. It can be shown that the achievement of the 2° target can be met with low additional costs compared to the business as usual case, while reducing total emissions by more than 30%. [ABSTRACT FROM AUTHOR]

Whether shocks to energy prices are permanent or transitory remains a contentious issue. This may result from mis-specifcation of the econometric tests, due for example to the uncertainty over the presence of a trend, or the possible presence of structural breaks and non-stationary volatility in the data. This paper makes a contribution by addressing the underlying characteristics of energy price data that infuence such econometric tests. First, we detect whether the data are characterised by non-stationary volatility and possible trend breaks. The next step involves employing novel unit root tests that unify the underlying characteristics, such as trend break and/or nonstationary volatility, of the data. We conclude shocks to energy prices are not transitory. We further decompose a benchmark oil price and its demand and supply components into their permanent and transitory components and compute the cross correlations to fnd that they conform to standard theories of commodity storage models. [ABSTRACT FROM AUTHOR]

This paper examines the optimal capacity choices of conventional power generators after the introduction of renewable production. We start with a basic and generally accepted model of the liberalized wholesale electricity market in which firms have insufficient incentives to invest and we illustrate how the entry of renewable generation tends to aggravate that problem. We show that the incentives to invest in firm capacity (e.g. conventional thermal plants) may be restored by means of a capacity auction mechanism. That mechanism is vulnerable and, hence, may prove ineffective unless governments can credibly commit not to sponsor the entry of new capacity outside the auction mechanism. We explain that such commitment may be particularly difficult in the current political context where energy policy is conditioned by environmental and industrial-policy goals. We finally propose a way to enhance the credibility of capacity auctions by committing to optimally retire idle (conventional) power plants in response to entry outside the auction. [ABSTRACT FROM AUTHOR]

This paper analyses recent energy intensity trends for 40 major economies using a structural decomposition analysis. Our focus lies on the question whether improvements in energy intensity were caused by structural change towards a greener economy or by technological improvements. We account for intersectoral trade by using the World Input-Output database and adjust sectoral energy use via the environmentally extended input-output analysis. We find strong differences between consumption and production-based energy consumption across sectors, particularly in the construction and electricity industry. Using the three factor Logarithmic Mean Divisia Index method, our decomposition analysis shows that recent energy intensity reductions were mostly driven by technological advances. Structural changes within countries played only a minor role, whereas international trade by itself even increased global energy intensity. Compared to a previous study only using production-based sectoral energy data, we find structural effects on energy intensity reductions to be systematically weaker under consumption-based data. [ABSTRACT FROM AUTHOR]

Growing concern about climate change and rising prices of fossil fuels has prompted governments to stimulate the development of renewables. The most common instrument is a feed-in tariff (FIT). This paper empirically tests whether or not FIT policies have been effective in encouraging the development of photovoltaic solar (PV), explicitly taking into account the structure and consistency of FITs. Panel data estimations are employed for 30 OECD member countries in the period 1990-2011. We find a positive effect of the presence of a FIT on the development of a country's added yearly capacity of PV per capita. This is in line with the results found in the existing literature. However, our study shows that the literature underestimates the potential impact of FITs, as the effect of a welldesigned FIT is much larger than the average effect of the currently applied FITs. Not only the height of the tariff is important, but also the duration of the contract and the absence/presence of a cap have an impact. We also show that consistency greatly affects the effectiveness of FITs. Consistency is especially important when the tariff of a FIT is low. The total effect of a FIT can be seven times larger if it is well designed. Our results are robust for differences between countries with respect to the availability of other policy instruments, the use of nuclear or hydro power and the level of CO2 emissions. [ABSTRACT FROM AUTHOR]

Asymmetric information is an important barrier to the adoption of energy efficient technologies. In this paper, we study supply-side implications of the associated incentive structure. We build on existing evidence that, in some settings, energy efficiency owns a credence component, whereby the supply side of the market has more information about what technology is best for consumers. The literature on credence goods markets suggests that an information advantage by expert-sellers leads to market inefficiencies, including low trade volume. We start by developing a simple framework to study supply-side incentives related to the provision of energy efficient technologies. We then document inefficiencies and potential remedies by discussing linkages between an empirical literature on credence goods and that on the market for energy efficiency. Doing so, we identify implications for the design of policies promoting the adoption of energy-efficient technologies. [ABSTRACT FROM AUTHOR]

In 2018, an agreement between the key EU institutions--the Commission, the European Parliament, and the European Council--was reached after a long-lasting discourse over the 2030 EU climate and energy policy package. This paper offers a comprehensive assessment of the EU package, with its three main targets: lower greenhouse gas emissions, higher renewable share in final energy consumption, and improved energy efficiency. We find that the renewable and energy efficiency targets have been set so high that the derived emissions reduction (50 percent) exceeds the EU climate target (40 percent). Hence, there is no need for an EU climate policy, for example, to use carbon prices to reach the EU climate goals. It is, however, not cost-efficient to achieve the climate target by imposing the three EU targets. We demonstrate that a cost-efficient policy that obtains a 50 percent GHG emissions reduction would increase annual welfare (relative to the Reference scenario) by an amount corresponding to 0.6 percent of GDP in Europe. [ABSTRACT FROM AUTHOR]

The promotion of renewable energy sources (RES) by governments is one way of helping countries to meet their energy needs while lowering greenhouse gas emissions. In this paper, we examine the role of energy policy in RES promotion, based on a carbon tax and RES price subsidy, at a time of technological and demand shocks in the European Union (E.U.) 15 countries, the United States (U.S.) and China, focusing on the macroeconomic implications. Using a dynamic stochastic general equilibrium model for RES and fossil fuels, our results suggest that, in the presence of a total factor productivity shock in the fossil fuel sector, such an energy policy can also be a driving force for smoothing the reduction of RES in the energy market (and vice versa). Additionally, we show that the E.U.15 grouping has a comparative advantage in terms of reaching grid parity compared with the other countries we considered which are more fossil fuel dependent. [ABSTRACT FROM AUTHOR]

Heavily Energy Subsidized Economies' energy subsidies cost the budget on average 4% of GDP in 2014. Resource rents permit administratively undemanding transfers to citizens to maintain political support, whose removal will be resisted, despite resulting inefficient consumption and lock-in risk. Collapsing energy prices delivering severe fiscal shocks combined with growing concerns over climate change damage make carefully designed reforms both urgent and politically more acceptable. Political logic suggests designing reforms that compensate vocal interest groups. The paper presents evidence on the magnitude and impacts of oil, gas and electricity subsidies, and discusses how the electricity sector can be weaned off subsidies, enabling CCGTs and unsubsidized renewables to reduce carbon emissions. [ABSTRACT FROM AUTHOR]

Commonly-employed Feed-in Tariff (FiT) structures result in either investors or policymakers incurring all market price risk. This paper derives efficient pricing formulae for FiT designs that divide market price risk amongst investors and policymakers. With increasing deployment and renewable energy policy costs, a means to precisely apportion this risk becomes of greater importance. Option pricing theory is used to calculate efficient FiT prices and expected policy cost when investors are exposed to elements of market price risk. Expected remuneration and policy cost is equal for all FiTs while policymaker and investor exposure to uncertain market prices differs. Partial derivatives characterise sensitivity to unexpected deviations in market conditions. This sensitivity differs by FiT type. The magnitudes of these effects are quantified using numerical examples for a stylised Irish case study. Based on these relationships, we discuss the conditions under which each policy choice may be preferred. [ABSTRACT FROM AUTHOR]

In this paper we investigate the long-run economic consequences of phasing out nuclear energy in the presence of stringent climate policies. We integrate endogenous growth theory and technology-based activity analysis into a dynamic numerical general equilibrium model. Both market-based and policy-mandated nuclear phase-out are studied. Using data from the Swiss economy we find that the aggregate welfare loss of carbon policy is as large as 1.21% and that nuclear phase-out raises the loss to 1.58%. Nuclear phase-out has no significant effect on economic growth. Increased investment, induced innovation, and sectoral change are the reasons that the economic impact of nuclear phase-out and the trade-off between energy and climate policy are moderate, once the dynamics of an economy are taken into account. Optimal phase-out time for nuclear depends mainly on future cost escalation in the energy sector. [ABSTRACT FROM AUTHOR]

The phenomenon of rebound effects has sparked considerable academic, policy and press debate in recent years over the effectiveness of energy efficiency policy. There has been a huge surge in empirical studies claiming rebound effects of hugely varying magnitudes. The contention of this paper is that the lack of consensus in the literature is grounded in a rush to empirical estimation in the absence of solid analytical foundations. Focus on measuring a single "rebound" measure has led to a neglect of detail on precisely what type of change in energy use is considered in any one study and on the range of mechanisms governing the economy-wide response. This paper attempts to bring a reflective pause to the development of the rebound literature, with a view to identifying the key issues that policymakers need to understand and analysts need to focus their attention on. [ABSTRACT FROM AUTHOR]

This paper briefly reviews some key aspects of U.S. energy policy history and policy-making complexity, considers the issues and pressures that growing international economic interdependency may bring, and suggests some approaches and tools for improvement. [ABSTRACT FROM AUTHOR]

This paper analyses bidder behaviour in the German photovoltaic (PV) auction pilot. It uses a novel approach combining insights from data analysis and decision theory to optimise an agent-based simulation model. We model both a uniform pricing (UP) scheme, a pay-as-bid (PAB) scheme, and a benchmark case, where agents adapt their bidding strategy. The findings are contrasted with empirical auction outcomes. The comparison shows that, especially in the early rounds, bid prices were above the costs--possibly due to uncertainties and false expectations concerning competition. This is particularly visible in the first round. Adapting their expectations to a higher competition level, bidders in the pay-as-bid simulation subsequently decrease their bids. From simulating a separate auction for arable land bidders, we see that this bidder type reduces support costs substantially and that an implicitly discriminatory auction yields more aggressive bids and can induce further cost reductions. [ABSTRACT FROM AUTHOR]

This paper introduces a novel approach to the hybrid modelling of technological change climate stabilisation cost literature. We describe how a post-Keynesian macroeconomic model of sectoral demand, E3MG, has been combined with investments in 26 energy technologies from a submodel, ETM. E3MG is a 20-region global energy-environment-economy (E3) econometric, dynamic simulation model. It is a component of the UK Tyndall Center's Community Integrated Assessment System. Technological change is endogenous, through its effects on general energy use and sectoral demand, and on energy technologies through the cost-reducing effects o f learning by doing and economies of scale. This approach directly challenges the notion that historically estimated models cannot be use for long-term analysis. The paper concludes with an account of how technological progress is induced in this hybrid system by high relative prices of carbon designed to achieve climate stabilization at 450ppmv. [ABSTRACT FROM AUTHOR]

The energy marker liberalisation process in Europe is increasingly focused on electricity market integration and related cross border issues. This signals that the liberalisation of national electricity markets is now closer to the long-term objective of a single European energy market. The interface between the national electricity markets requires physical interconnections and technical arrangements. However, further progress towards this objective also raises important issues regarding the framework within which the integrated market is implemented. This paper reviews the progress towards a single European electricity market. We then discuss the emerging issues of market concentration, investments, and security of supply as well as some aspects of market design and regulation that are crucial for dynamic performance of a single European market. [ABSTRACT FROM AUTHOR]

This paper dissects the ways in which policy regime risks influence decisions over innovative energy technology investments. We apply compound real options methodology to evaluate the investment in a virtual power plant platform and distributed energy resource (DER) assets in view of volatile electricity market prices and an uncertain future electricity market design. The analysis reveals two aspects of policy regime risks: a policy content effect relating to actual market dynamics resulting from a (new) policy regime, and a policy process effect relating to (uncertainty about) the speed and probability of a regime change. The paper underlines the importance of predictable policymaking to stimulate risky investment. It further details the need to account for technology-specific investment responses to different policy regimes and risks, caused by different degrees of market versus subsidy exposure and differences between platform versus non-platform technologies. [ABSTRACT FROM AUTHOR]

A price reform in Turkey increased the residential electricity tariff by more than 50 percent in 2008. The reform, aimed at encouraging energy efficiency and private investment, sparked considerable policy debate about its potential impact on household welfare. This paper estimates a short-run residential electricity demand function to evaluate the distributional impact of the tariff increase. The analysis allows heterogeneity in households' price sensitivity and the model is estimated using a nationally representative sample of 8,572 Turkish households. The results suggest that rich households in Turkey are three times as responsive in adjusting consumption to price changes as poor households are. In addition, the welfare loss of the poorest income quintile--measured by the change in consumer surplus as a percentage of income--is 2.9 times that of the wealthiest. [ABSTRACT FROM AUTHOR]

The U.S. Clean Power Plan stipulates a state-specific performance-based CO2 emission standard, delegating states with considerable flexibility for using either a tradable performance-based or a mass-based permit program. This paper analyzes these two standards under imperfect competitive. We limit our attention to (1) short-run analyses and (2) a situation in which all states are subject to the same type of standard. We show that while the cross-subsidy inherent in the performance- based standard might effectively reduce power prices, it could also inflate energy consumption. A dominant firm with a relatively clean endowment under the performance-based standard would be able to manipulate the electricity market as well as to elevate permit prices, which might worsen market outcomes compared to its mass-based counterpart. On the other hand, the "cross-subsidy" could be the dominant force leading to a higher social welfare if the leader has a relatively dirty endowment. [ABSTRACT FROM AUTHOR]

The paper analyzes the interactions between trade and renewable energy policies based on the EU-China solar panel dispute which is the most significant antidumping (AD) complaint in Europe. We build a price competition duopoly model with differentiated products and intra-industry trade in photovoltaic (PV) equipment. We show that an optimal antidumping duty always increases with the feed-in tariff (FIT) program set in the home country. An appropriate antidumping duty--nullifying the dumping margin--decreases with the FIT program. We show that optimal FIT increases with the AD duty. Therefore, trade and renewable energy optimal policies may complement one another. Lastly, we introduce R&D activities in the PV sector, and international spillovers. We show that R&D makes the optimal FIT lower and increases the dumping margin. These effects are reinforced by technological spillovers. [ABSTRACT FROM AUTHOR]

This paper uses a model with Directed Technical Change to theoretically analyse observable heterogeneous energy intensity developments. Based on the empirical evidence, we decompose changes in aggregate energy intensity into structural changes in the economy (structural effect) and within-sector energy efficiency improvements (efficiency effect). The relative importance of these effects is deter mined by energy price growth and sectoral productivities that drive the direction of technical change. When research is directed to the labour-intensive sector, the structural effect is the main driver of energy intensity dynamics. In contrast, the efficiency effect dominates energy intensity developments, when research is directed to energy-intensive industries. Increasing energy price generally leads to lower energy intensities and temporal energy price shocks might induce a permanent redirection of innovation activities. We calibrate the model to empirical data and simulate energy intensity developments across countries. The results of our very stylised model are largely consistent with empirical evidence. [ABSTRACT FROM AUTHOR]

This paper provides evidence on the relevance of modeling adequately the seasonal character of coal and electricity production across Chinese regions. Unlike other work, this paper relaxes the assumption of deterministic seasonality, allowing for time and regional variation in this economy. More specifically, we analyze and distinguish the type of seasonality around the year that prevails in the case of coal and electricity production of each individual Chinese province. Our results indicate that for the majority of the provinces seasonality is stochastic in both types of energy considered. Our findings provide new evidence of a Lunar New-Year effect in February and Summer as well as Winter effects in coal and electricity production. However, in terms of seasonal patterns and their evolution over time, there are significant differences between the Northern Southern regions. Besides for each type of energy, regional clusters matter for the appropriate design of energy-development policy. [ABSTRACT FROM AUTHOR]

Energy conservation is a long-term strategic policy in China to support its economic and social development. This strategy is important for saving resources, protecting the environment, and ensuring a secure supply of energy. However, energy conservation often involves large amounts of investment and may also have dampening impacts on some local and regional economies. Moreover, energy conservation has many features of a public good. Therefore, government policy will have to play a strong role to foster local efforts and interregional cooperation on this issue. This paper analyzes a promising policy instrument -- an interregional energy conservation-quota trading system. An operational model is developed to simulate the workings of this policy instrument for a variety of quota allocations among regions. The results indicate that a tradable quota system can help China achieve its conservation target in a cost-effective way and in accordance with its regional development strategy. [ABSTRACT FROM AUTHOR]

According to the "Renewable Sources" EU Directive 2001/77/CE, the Italian Government goal is to attain the share of 22% in RES electricity production in 2010. In such context it becomes crucial to explore the existence of consumer's Willingness to Pay (WTP) in order to use renewable energy in the electricity production. This study, is based on a national survey with 1601 interviews made, in Italy, in November 2006. My aim is twofold. Firstly, I wish to assess the consumer's WTP which is the basis for market sustainability of such energy policy goal and, secondly, I evaluate the share of the necessary public support to RES policy which is covered by the aggregate WTP of Italians. This is an implicit assessment of the plausibility/acceptance of the announced target policy. In my survey framework I obtain the consumer's WTP with two different approaches and to this end the sample has been divided in two parts. In the first sub-sample I propose the full price vector with a downward elicitation format while in the second sub-sample I use the same price vector with an upward elicitation format. In this paper I focus on the different uncertainty degree that affects respondent's choices. I take care econometrically of this issue using an individual stochastic valuation approach and a referendum approach. I obtain for most of the estimated models that estimates of WTP are in agreement with other international results. The aggregate WTP for RES in Italy, however, is (still) not enough to attain the Italian Government goal in 2010. [ABSTRACT FROM AUTHOR]

This paper summarizes the main features of a linked CGE-MARKAL model system capable of simulating the macro-level economy and micro-level technology detail of the transport sector. Emphasis is given to issues of calibration of such a hybrid system, with references provided to already published papers based on this research for coverage of other details. [ABSTRACT FROM AUTHOR]

Improving energy efficiency quickly is key to mitigating climate change and requires improvements implemented in firms. As these require upfront investments, good access to external finance is important. Theory suggests that information asymmetries may prevent lenders from including energy efficiency into their lending assessment, even though higher energy efficiency increases firm cost-competitiveness and its collateral value. Empirically, little is known about the impact of energy efficiency on access to external finance. For the first time, we examine empirically the effect of a firm's higher energy efficiency on their ability to obtain loans in European Union countries by exploiting a unique firm-level dataset. We find that energy efficiency has no effect on the ability of a firm to obtain external financing compared to other indicators on the financial or operational health of the firm. The results reveal an unexploited potential for energy efficiency policy to signal when firms are energy efficient. [ABSTRACT FROM AUTHOR]

This paper investigates inequality in energy intensity between EU-28 member countries over the 2007-2012 period. Inequality in energy intensity is measured by using the Zenga inequality index. The analysis is carried out by measuring inequality from the bottom of the energy intensity distribution to the top. This approach enables to identify the most unequal portions of the energy intensity distribution. To provide information on the causes of inequality at every point of the distribution, we show that inequality can be broken down into three components explaining the roles played by energy transformation, final energy intensity and their interaction in determining inequality in energy intensity. This decomposition reveals the impact of each component of inequality from the bottom of energy intensity distribution to the top. Results show that final energy intensity plays a major role in explaining inequality in the energy intensity distribution. The interaction component explains that EU-28 countries with low energy intensity are more efficient in energy transformation and less energy-intensive in enduse sectors than EU-28 countries with high energy intensity. The energy transformation component is higher when measuring inequality between the countries at the bottom of the distribution and those in the rest of the distribution, suggesting that disparities in energy transformation efficiency play an important role in determining inequality in energy intensity between the least energy-intensive countries and the other countries. The high inequality at the top of the distribution is due to the lower efficiency in energy transformation in the most energy-intensive countries, which reinforces the effect of disparity in final energy intensity between the countries at the top of the distribution and the other countries. [ABSTRACT FROM AUTHOR]

This paper presents evidence that the accumulating cost of Germany's ambitious plan to transform its system of energy provision--the so-called Energiewende--is butting up against consumers' willingness-to-pay (WTP) for it. Following a descriptive presentation that traces the German promotion of renewable energy technologies since 2000, we draw on two stated-preference surveys conducted in 2013 and 2015 that elicit the households' WTP for green electricity. Two models are estimated, one based on a closed-ended question framed around Germany's target of 35% renewable energy in electricity provision by 2020, and the other on an open-ended format that captures changes in WTP over time. To deal with the bias that typifies hypothetical responses, the models distinguish respondents according to whether they express definite certainty in their reported WTP. The results from both models reveal a strong contrast between the households' general acceptance of supporting renewable energy technologies and their own WTP for green electricity. [ABSTRACT FROM AUTHOR]

Over the last decade Germany has boosted renewable energy in power production by means of massive subsidies. The flip side are very high electricity prices which raise concerns that the transition cost towards a renewable energy system will be mainly borne by poor households. In this paper, we combine computable general equilibrium and microsimulation analyses to investigate the economic impacts of Germany's renewable energy promotion. We find that the regressive effects of renewable energy promotion could be attenuated by alternative subsidy financing mechanisms. [ABSTRACT FROM AUTHOR]

Residential weatherization programs have become a major component of U.S. energy policy. Through these programs, households receive heavily subsidized energy efficiency upgrades as well as informational and behavioral treatments designed to encourage conservation. While previous work demonstrates that weatherization programs provide sizable energy savings, all have measured the composite effect of efficiency upgrades and behavioral treatments. In this paper, we present the first estimates which disentangle the energy savings provided by each of the individual interventions. Our results reveal that the actual energy savings achieved by the efficiency upgrades are substantially smaller than exante, engineering predictions. Moreover, we present evidence that the energy savings provided by the simple behavioral interventions can exceed the savings resulting from the much more costly efficiency upgrades. [ABSTRACT FROM AUTHOR]

This paper presents an overview of the study design and the results of the EMF 24 U.S. Technology Scenarios. The EMF 24 U.S. Technology Scenarios engaged nine top energy-environment-economy models to examine the implications of technological improvements and technological availability for reducing U.S. greenhouse gas emissions by 50% and 80% by 2050. The study confirms that mitigation at the 50% or 80% level will require a dramatic transformation of the energy system over the next 40 years. The study also corroborates the result of previous studies that there is a large variation among models in terms of which energy strategy is considered most cost-effective. Technology assumptions are found to have a large influence on carbon prices and economic costs of mitigation. [ABSTRACT FROM AUTHOR]

This paper assesses the impact of French policies for residential space-heating energy consumption, both enacted (tax credits for the purchase of energy efficient durables, soft loans for retrofitting actions, stringent building codes) and anticipated (carbon tax, retrofitting obligation). It uses a hybrid energy-economy model incorporating specific features of energy conservation, notably the rebound effect and some "barriers" to energy efficiency such as split incentives and imperfect information. Forward-looking simulations show that (i) stand-alone policies improve the energy efficiency of the building stock but, with the exception of carbon tax, generate a rebound effect; (ii) interactions among instruments are roughly additive; (iii) a combination of all policies fails to meet Government conservation targets. [ABSTRACT FROM AUTHOR]

Energy-efficiency cost curves show the required expenditures for achieving any specific reductions in energy use from the baseline level. When they are applied in a policy setting, the assumptions underlying these schedules need to be carefully evaluated if one is to derive useful conclusions. This paper begins by adopting the cost curve and underlying assumptions used in a previous and highly visible study of the economic potential for energy-efficiency improvements. Adjustments are made to the cost curve to incorporate demographic, economic and market effects that are often included in many energy-economy models. Energy efficiency tends to be more costly with the adjusted than with the original cost curves, due primarily to limits on adoption and to policy program costs. It is hoped that the exposition will allow policymakers more insight into why different results are obtained with alternative behavioral assumptions, even if the technology costs and performances are the same with both approaches. [ABSTRACT FROM AUTHOR]

Understanding the determinants of home-efficiency improvements is significant to a range of energy policy issues, including the reduction of fossil fuel use and environmental protection. This paper analyzes retrofit choices by assembling a unique data set merging a nationwide household survey from Germany with regional data on wages and construction costs. To explore the influence of both heterogeneous preferences and correlation among the utility of alternatives, we estimate conditional-, random parameters-, and error components logit models that parameterize the influence of costs, energy savings, and household-level socioeconomic attributes on the likelihood of undertaking one of 16 renovation options. We use the model coefficients to derive household-specific marginal Willingness to Pay estimates, and with these assess the extent to which free-ridership may undermine the effectiveness of recently implemented programs that subsidize the costs of retrofits. [ABSTRACT FROM AUTHOR]

Gaining a better understanding of how electricity demand has changed over the past three decades, particularly in light of government involvement in influencing electricity demand, is an important step towards shaping energy policy in the U.S. and internationally. This study of U.S. electricity demand finds that those states that have moderate to strong commitment to energy efficiency programs reduce electricity intensity relative to what it would have been with weak program commitment; in the residential sector by 4.4 percent, in the commercial sector by 8.1 percent, and in the industrial sector by 11.8 percent. The findings are similar with respect to levels of electricity consumption in the commercial and industrial sectors, but not the residential sector. Moreover, the evidence in this paper indicates that energy efficiency program commitment in all three sectors of the U.S. economy has transformed electricity demand with respect to three key economic variables; electricity price, income as measured by per capita income or gross state product, and technological change. Also, this study finds that nationwide spillover from energy efficiency programs may be rapid and ubiquitous in the residential sector. Estimates of the impact of California's energy efficiency programs confirm the speculation that these efforts have dramatically reduced state electricity intensity; to date, these impacts are likely the upper bounds of the impacts of strong state-level energy efficiency program commitment. [ABSTRACT FROM AUTHOR]

This paper explores the relationships among per capita income, energy consumption, and carbon dioxide (CO2) emissions by focusing on a set of economies at advanced stages of development, the U.S. states. Energy consumption and emissions grew 50-60 percent on average over the 1960-1999 period. The states' per capita energy consumption and emissions have grown on average 2 percent annually. The energy consumption income elasticity is positive but decreasing in income, although energy production takes an inverted-U shape, reflecting the electricity imports among high income states. The standard CO2 measure, corresponding to energy production, is characterized by an inverted-U environmental Kuznets curve. Adjusting emissions for interstate electricity trade yields an emissions-income relationship that peaks and plateaus. The carbon intensity of energy declines with income for total energy consumption and the industrial, residential, and commercial sectors. [ABSTRACT FROM AUTHOR]

Most energy-economy policy models offered to policy makers are deficient in terms of at least one of technological explicitness, microeconomic realism, or macroeconomic completeness. We herein describe CIMS, a model which starts with the technological explicitness of the "bottom-up" approach and adds the microeconomic realism and macroeconomic completeness of the "top-down" CGE approach. This paper demonstrates CIMS' direct utility for policy analysis, and also how it can be used to better estimate the long run capital-for-energy substitution elasticity (ESUB) and autonomous energy efficiency index (AEEI) technology parameters used in top-down models. By running CIMS under several possible energy price futures and observing their effects on capital and energy input shares and energy consumption, we estimate an economy-wide ESUB of 0.26 and an AEEI of O. 57%, with significant sectoral differences for both parameters. [ABSTRACT FROM AUTHOR]

Policy makers and analysts are raising questions about the adequacy of policy and technology representation in conventional energy and economic models. Most conventional models rely on a highly stylized and limited characterization of technology. In these models, any desired changes in energy demand are driven largely by pure price mechanisms such as energy taxes or carbon charges. In this paper, however, we explore the mapping of discrete technology characterizations and examine how cost-effective technologies and programs might prompt desirable increases in energy efficiency. Using the commercial health care sector as an example, we show how changes in energy efficiency and technology investments might be more properly represented in policy models. [ABSTRACT FROM AUTHOR]

Developing an energy policy from a collection of programs is made more complicated because there is no single value that can be used as a best estimate of the contribution of a single policy, despite the ability to estimate the impact of the complete suite. In this paper we illustrate the problem and use cooperative game theory to show one way to estimate individual effects of a policy goal in the context of collective estimates. Using an economic equilibrium model, we illustrate the behavior of four policies, namely, a gasoline tax, CAFE standards, a carbon tax, and drilling the Arctic National Wildlife Reserve, through their Shapley value contributions in measuring the impact of each in the context of a suite of policies. We apply the Shapley value to measure the average marginal reduction in imports for each policy, and present a number of scenarios that illustrate how the Shapley value behaves as a measure of policy contribution. [ABSTRACT FROM AUTHOR]

The recent volatility of short-run gasoline prices in the United States has resulted in calls for the government to intervene. This paper details a simple means of reducing that variability, utilizing federal tax policies, without eliminating the signaling role of prices in the medium- to long-term. If properly implemented, the gyrations in gas prices could be largely removed, with little impact on the revenue that the federal government generates through taxation. If applied to the markets in nations that have significantly higher gasoline taxes, essentially all price volatility could be removed. [ABSTRACT FROM AUTHOR]

The same fuels are taxed at widely different rates in different countries while different fuels are taxed at widely different rates within and across countries. This paper considers what tax theory has to say about efficient energy tax design. The main factors for energy taxes are the optimal tariff argument, the need to correct externalities such as global warming, and second-best considerations for taxing transport fuels as road charges, but these are inadequate to explain current energy taxes. EU energy tax harmonisation and Kyoto suggest that the time is ripe to reform energy taxation. [ABSTRACT FROM AUTHOR]

In this paper we describe the Spanish electricity industry and its current regulatory regime. Special emphasis is given lo the description and discussion of market design issues (including stranded cost recovery), the evolution of market structure, investment in generation capacity and network activities. We also provide a critical assessment of the 1997 regulatory reform, which did not succeed in introducing effective competition, but retained an opaque regulation which has been subject to continuous governmental interventionism. Furthermore, the implementation of the Kyoto agreement could show the lack of robustness of the regulatory regime. [ABSTRACT FROM AUTHOR]

The wave of electricity market restructuring both within the United States and abroad has brought the issue of horizontal market power to the forefront of energy policy. Traditionally, estimation and prediction of market power has relied heavily on concentration measures. In this paper, we discuss the weaknesses of concentration measures as a viable measure of market power in the electricity industry, and we propose an alternative method based on market simulations that take advantage of existing plant level data. We discuss results from previous studies the authors have performed, and present new results that allow for the detection of threshold demand levels where market power is likely to be a problem. In addition, we analyze the impact of that recent divestitures in the California electricity market will have on estimated market power. We close with a discussion of the policy implications of the results. [ABSTRACT FROM AUTHOR]