Resource and Energy Economics最新文献

Trade reduces the effectiveness of climate policies such as carbon pricing when domestic products are replaced by more carbon-intensive imports. We investigate the impact of unilateral carbon pricing on electricity generation in a country open to trade through interconnection lines. We characterize the energy mix with intermittent renewable sources of energy (wind or solar power). Electricity trade limits the penetration of renewables due to trade-induced competition. A carbon border adjustment mechanism (CBAM) removes this limit by increasing the cost of imported power, or by deterring imports. The CBAM must be complemented by a subsidy on renewables to increase renewable generation above domestic consumption. The interconnection line is then used to export power rather than importing it when renewables are producing. We also examine network pricing and investment into interconnection capacity. A higher carbon price increases interconnection investment which further reduces the effectiveness of carbon pricing. In contrast, when renewable electricity is exported, a higher subsidy on renewables reduces further carbon emissions by expanding interconnection capacity.

The paper integrates the characteristics of regenerative energies into a dynamic macroeconomic model with climate change. Learning and economies of scale in new energy moderate the cost of emissions reductions and increase the speed of decarbonization. I provide closed-form analytical solutions for the development of regenerative energies, emissions, consumption, and population. The elasticity of substitution between clean and dirty energy inputs, stringency of climate policy, and potential raw material scarcity constitute critical conditions for reaching carbon neutrality by 2050. I find that a timely carbon phase-out requires sufficient substitution in the energy sector, continued learning and scale effects in regenerative energies, and active climate policy, which is indispensable even with enormous cost degression of regenerative energies. Raw material scarcity induced by regenerative energy use slows down the transition but can be overcompensated by more stringent climate policy at a moderate economic cost.

As countries reduce greenhouse gas emissions to fight the potential impacts of climate change, increasing attention is being paid to methane, which is roughly 34 times more potent than CO₂ over a 100-year time span. Governments in many jurisdictions aim to reduce methane by 45–75% in oil and gas sectors by 2030. Methane reductions are often achieved by implementing new technologies and operational techniques, but jurisdictions have discussed the implementation of a methane tax. While several studies have focused on the financial costs of reducing methane emissions through adopting new technologies, little information exists on the economy-wide impacts of these initiatives and the effectiveness of different policy tools. We develop a dynamic computable general equilibrium model for British Columbia, Canada, to evaluate the economy wide impacts of methane technology standards versus taxes. Findings indicate that methane can be reduced by 75% by 2030 using technology standards at a loss of 0.0089% of GDP in 2030. Impacts associated with a methane tax will range from a loss of 0.0071–0.18% in 2030, depending on whether new technologies are assumed to be adopted. If a sufficiently high methane tax incentivizes adoption of new technology, the negative impacts of a tax are lower than that of a standard once the policy is fully implemented. While the overall economy-wide impact of a technology standard is relatively low, we find that it is as much as 65% higher than the direct costs.

This paper develops a two-region New Economic Geography model with polluting firms subject to regional abatement policies. Pollution accumulates in the local environment and decreases the welfare of the population. We show that environmental policies have two opposing effects on welfare: they reduce nominal wages and increase environmental quality. If environmental regulations are equally strict in the two regions then population, pollution and wages tend to converge as trade becomes more open. If the two regions have different but unambitious environmental regulations, firms agglomerate in the laxer region, which becomes a pollution haven. However, a sufficiently far-reaching environmental policy in one of the regions raises its environmental quality, increasing its attractiveness for population and firms, and the emergence of a pollution haven is avoided. We also show that if the natural absorption rate of pollution is low, the environment recovers slowly, population and firms move between regions in a pollute-and-flee cycle and no static equilibrium is reached.

As the need for drastic reductions in global greenhouse gas emissions becomes increasingly urgent, governments and policymakers are developing proposals for climate change policies that aim to achieve net-zero emissions. However, the challenge lies in determining the most effective way to operationalize this transformation. While cost efficiency is often emphasized as a desirable property, experience shows that it is neither necessary nor sufficient to achieve a desirable policy portfolio. Instead, we advocate for a broader definition of economic efficiency: policies must also be feasible, fair, effective, and credible. Trade-offs between these criteria are common, and must be balanced to create a successful policy portfolio. The European experience provides interesting case studies with which to illustrate these efficiency dimensions and their implications.

Over-exploitation of natural resources is a major problem, and transitions to sustainable harvest are taking place worldwide. To determine the optimal harvesting strategy, including the optimal speed and approach to transition toward sustainable harvest, policymakers need to estimate the net present values of natural resources. Previous studies have shown that discounting reduces the future value of natural resources, but the long-term increase in their price may partially compensate for discounting. However, the price and future values of natural resources may also be affected by the transition from over-harvesting to sustainable harvest. Here we present a model that endogenizes the effect of non-sustainable harvest on the price of a renewable natural resource. We show that the transition to sustainable harvest is expected to increase the resource’s price significantly, at a rate that is greater than its long-term increase. Incorporating this effect increases the estimated net present value of ecosystems providing renewable natural resources.

This study estimates the relationships between green and blue nature and the life satisfaction (LS) of residents in the six largest cities in the Netherlands to monetize the value of urban nature. The analysis uses both survey and geographic information system (GIS) data on the availability of nature to examine the influence of this methodological choice on the valuation outcomes. The main findings are that different indicators of the availability of nature consistently reveal positive relationships with reported LS, which implies substantial marginal willingness-to-pay (MWTP) values for urban nature. Valuation results based on the survey data indicate higher MWTPs compared to GIS data on nature availability, which may be explained by the more disaggregated data from surveys on the availability and use of nature.

Persistent air-pollution problems have led authorities in many cities around the world to impose limits on car use by means of vintage-specific restrictions or low-emission zones. Any vintage restriction must establish not only the cars that face a restriction but also its geographic area of application. As a result of the restriction, a fraction of restricted cars are exported outside the restricted area. Because restricted cars become cheaper, emissions in the restricted area could increase if exported cars remain too close to it. The extent to which such emissions leakage can occur crucially depends on transaction costs in the car market. We study this possibility with a model of the car market that allows for transaction costs and data from Santiago’s 2017 vintage restriction. We fail to find emissions leakage, at least severe enough to undo the 2017 policy effects. Interestingly, transaction costs are shown to have a non-monotonic impact on emissions, and hence, on welfare.

Energy policies for promoting investment in renewable energy sources have become crucial for deploying green energy technologies worldwide. Conventional incentive systems assign risk to either policymakers or investors. In this paper, we combine option theory and game theory to obtain optimal parameters for incentive schemes with different degrees of risk-sharing. We present an empirical application to the Spanish electricity market for 2013, when the Feed-in Tariff scheme was still in force, and for 2019, when Feed-in Tariffs had been completely phased out but before the demand shock caused by COVID-19, the restructuring of market price limits, and the recent energy price crisis in Europe. Our results indicate that there are more flexible systems based on Fixed Tariffs and Premiums that can outperform conventional designs, since they may enable the same investment level to be reached at a lower regulatory cost. In addition, these hybrid schemes permit risk-sharing between both parties. Our results may also be useful for designing incentives awarded through competitive auctions.

Despite a 30-year long history, Renewable Portfolio Standards (RPS) remain controversial and debates continue to surround their efficacy in leading the low-carbon transition in the electricity sector. Contributing to the ongoing debates is the lack of definitive causal evidence on their impact on investments in renewable capacity and generation. This paper provides the most detailed analysis to date of the impact of RPSs on renewable electricity capacity investments and on generation. We use state-level data from 1990–2019 and recent econometric methods designed to address dynamic and heterogeneous treatment effects in a staggered adoption panel data design. We find that, on average, RPS policies increase wind generation capacity by 600–1200 MW, a 44% increase, but have no significant effect on investments in solar capacity. Additionally, we demonstrate that RPSs have slow dynamic effects: most of the capacity additions occur 5 years after RPS implementation. Estimates for wind and solar electricity generation mimic those for capacity investments. We also find similar results using an alternate treatment definition that allows states to meet their RPS requirements with pre-existing renewable generation and renewable generation from nearby states.