The UK market for energy service contracts in 2014–2015

This paper provides an overview of the UK market for energy service contracts in 2014 and highlights the growing role of intermediaries. Using information from secondary literature and interviews, it identifies the businesses offering energy service contracts, the sectors and organisations that are purchasing those contracts, the types of contract that are available, the areas of market growth and the reasons for that growth. The paper finds that the UK market is relatively large, highly diverse, concentrated in particular sectors and types of site and overwhelmingly focused upon established technologies with high rates of return. A major driver is the emergence of procurement frameworks for energy service contracts in the public sector. These act as intermediaries between clients and contractors, thereby lowering transaction costs and facilitating learning. The market is struggling to become established in commercial offices, largely as a result of split incentives, and is unlikely to develop further in this sector without different business models, tenancy arrangements and policy initiatives. Overall, the paper concludes that energy service contracts can play an important role in the transition to a low-carbon economy, especially when supported by intermediaries, but their potential is still limited by high transaction costs.     

Hydropower–water and renewable energy in Turkey: Sources and policy

Turkey's energy consumption has been growing much faster than its production. It forces Turkey to make a rapid action to supply energy demand. From the viewpoint of primary energy sources (petroleum and natural gas), Turkey is not a rich country, but it has an abundant hydropower potential to be used for generation of electricity. Hydropower is the most important kind of renewable, sustainable energy and a proven technology for electricity generation. The aim of this paper is to discuss sources and policy of hydropower, water and renewable energy in Turkey and compares the hydropower application with Europe.     

The energy sector in Eritrea—institutional and policy options for improving rural energy services

The energy consumption patterns and in particular, those of the rural household and small and medium enterprises (SMEs) in Eritrea are assessed. Eritrea's total final energy consumption in 1998 was estimated to be around 619,580 toe, of which 68% was consumed by the household sector, 16% by the commercial/public sector, 13% by transport and 3% by industry. The sources of energy were 66.3% biomass based (fuelwood, dung, charcoal, agri-residue), 31% oil products and 2% electricity. It is also noted that 98% of the rural population and 20% of the urban residents do not have access to electricity. Over 80% of the energy needs of rural enterprises is met by biomass or animate/human labour. To analyse the root problems hindering the wider dissemination of modern energy services to rural areas, two key hypotheses related to policy and institutional framework were selected and tested. The findings indicate that Eritrea has general energy policies pertaining to the development of electricity, oil and renewable energy sub-sectors for the benefit of the public and the economy. The absence of sharply focussed, pro-rural energy policy and/or their policy instruments has been observed. The key problem is, however, the weakness in implementation of rural energy projects and programmes. This is mainly due to inappropriate institutional structure and/or gaps in the structure, in addition to lack of corporate culture; poor incentives for workers; and, poor linkages among the various stakeholders concerned in energy for rural development.     

The application of contrast explanation to energy policy research: UK nuclear energy policy 2002–2012

This paper advances the application of the methodology, contrast explanation, to energy policy research. Research in energy policy is complex and often involves inter-disciplinary work, which traditional economic methodologies fail to capture. Consequently, the more encompassing methodology of contrast explanation is assessed and its use in other social science disciplines explored in brief. It is then applied to an energy policy research topic—in this case, nuclear energy policy research in the UK. Contrast explanation facilitates research into policy and decision-making processes in energy studies and offers an alternative to the traditional economic methods used in energy research. Further, contrast explanation is extended by the addition of contested and uncontested hypotheses analyses. This research focuses on the methods employed to deliver the new nuclear programme of the UK government. In order to achieve a sustainable nuclear energy policy three issues are of major importance: (1) law, policy and development; (2) public administration; and (3) project management. Further, the research identifies that policy in the area remains to be resolved, in particular at an institutional and legal level. However, contrary to the literature, in some areas, the research identifies a change of course as the UK concentrates on delivering a long-term policy for the nuclear energy sector and the overall energy sector.     

The role of coal in energy policy and sustainable development of Turkey: Is it compatible to the EU energy policy?

This paper aims to assess the current and future role of coal in energy strategy of Turkey, and evaluates the compatibility of policies to the EU energy policy and strategy. Coal is regarded as the most important indigenous energy source in Turkey together with hydropower to strengthen the supply security of the country. Turkish government set targets to fully utilize coal reserves of the country in next decades. However, the country is also in the process of becoming an EU Member State, hence, it is expected that the energy policies have to comply with the EU. Moreover, Turkey ratified Kyoto Protocol in 2009, thus the country should limit CO₂ emission together with other greenhouse gases. The probable obstacles that Turkey may face due to the utilization of coal were determined as CO₂ emissions, lack of technology and application in Carbon Capture and Storage (CCS) and health and safety issues. It is concluded that coal is a very important domestic energy source for Turkey but new policies have to be developed and adopted immediately, and more realistic targets for the country should be set accordingly.     

The water–energy nexus in Middle East and North Africa

Extracting, delivering, and disposing water requires energy, and similarly, many processes for extracting and refining various fuel sources and producing electricity use water. This so-called ‘water–energy nexus’, is important to understand due to increasing energy demands and decreasing freshwater supplies in many areas. This paper performs a country-level quantitative assessment of this nexus in the MENA region. The results show a highly skewed coupling with a relatively weak dependence of energy systems on fresh water, but a strong dependence of water abstraction and production systems on energy. In case of Saudi Arabia it is estimated that up to 9% of the total annual electrical energy consumption may be attributed to ground water pumping and desalination. Other countries in the Arabian Gulf may be consuming 5–12% or more of total electricity consumption for desalination. The results suggest that policy makers should explicitly consider energy implications in water intensive food imports and future restructuring of water demand. This will help in making more integrated decisions on water and energy infrastructure systems. An integrated assessment may in some cases favor water reuse and changes in the agricultural sector as opposed to the expansion of energy intensive and financially expensive desalination systems.     

Exploring drivers of energy demand in Cyprus – Scenarios and policy options

This paper describes a new set of energy demand forecasts for the Republic of Cyprus up to the year 2040, which have been developed in support of the renewable energy roadmap that was prepared for national authorities by the International Renewable Energy Agency. The analysis takes into account national end-use data from the residential and tertiary sector that had not been exploited up to now. Four final energy demand scenarios with diverging assumptions were defined in this study, offering a wide range of possible outcomes up to 2040; in addition, four alternative scenarios were applied for sensitivity analysis. Two of these scenarios can be regarded as those continuing the trends of the recent past in Cyprus (prior to the economic and financial downturn of years 2011–2014). However, a more rigorous implementation of energy efficiency measures in buildings and transport, as defined in the fourth scenario of this study, is also realistic; despite its potential costs, it might allow Cyprus both to decrease its carbon emissions in line with the long-term EU decarbonisation targets, and to reduce its dependence on fossil fuels, thereby promoting energy efficiency as an important climate change adaptation measure.     

Why have greenhouse emissions in RGGI states declined? An econometric attribution to economic,energy market,and policy factors

The Regional Greenhouse Gas Initiative (RGGI) is a consortium of northeastern U.S. states that limit carbon dioxide emissions from electricity generation through a regional emissions trading program. Since RGGI started in 2009, regional emissions have sharply dropped. We use econometric models to quantify the emissions reductions due to RGGI and those due to other factors such as the recession, complementary environmental programs, and lowered natural gas prices. The analysis shows that after the introduction of RGGI in 2009 the region's emissions would have been 24% higher without the program, accounting for about half of the region's emissions reductions during that time, which were far greater than those achieved in the rest of the United States.     

The renewable energy consumption–growth nexus in Central America

This study examines the relationship between renewable energy consumption and economic growth for a panel of six Central American countries over the period 1980–2006. The heterogeneous panel cointegration test reveals a long-run equilibrium relationship between real GDP, renewable energy consumption, real gross fixed capital formation, and the labor force with the respective coefficients positive and statistically significant. The results from the panel error correction model indicate bidirectional causality between renewable energy consumption and economic growth in both the short- and long-run.     

Driving forces for and barriers to providing energy services—a study of local and regional energy companies in Sweden

Improving energy efficiency is a cornerstone in climate change mitigation, and energy services are portrayed as a promising market-based approach to achieve this. This paper examines the barriers to, and driving forces needed for, the implementation of energy services from the perspective of Swedish local and regional energy companies. This includes an analysis of the resources needed in three phases of energy service implementation, i.e., development, sales, and deployment. The results indicate a supply-side interest in providing energy services, with the major challenges being related to (a) intra-organizational issues such as a lack of strategic direction and intent and (b) a perceived lack of knowledge, interest, and trust on the part of potential energy service customers. The paper concludes with managerial and policy implications on how an increased focus and impact of energy service can be achieved among local and regional companies.     

The UK offshore wind power programme: A sea-change in UK energy policy?

The British offshore windfarm programme presages the emergence of Britain as more of a leader than a laggard in renewables, the latter being the status it has hitherto endured in comparison to countries such as Denmark, Germany and Spain. Britain looks increasingly likely to exceed 20% of electricity being supplied from renewable energy by 2020, provided there continues to be adequate financial incentives for renewable energy. This turnaround is associated with increased British concerns about energy dependence on imported natural gas as well as pressure from EU legislation. However there are many planning pressures that countervail the drive for offshore wind power. British planning policy on offshore wind is distinctive (compared to other EU states) for its pragmatic, ‘criteria based’, approach that appears to favour offshore wind power development. The extent of the British offshore wind power programme is likely to depend heavily on consumer reactions to price increases caused by the offshore wind power programme.     

The development and application practice of wind–solar energy hybrid generation systems in China

China is the largest developing country in the world. At present, more and more energy demand gives immense pressure to Chinese government. The inappropriate energy structure must be improved by Chinese government in order to achieve the sustainable development of economy and society. Development and application of renewable energy, such as wind energy, solar energy, biomass energy, etc., have been regarded by the government and the local people in the past 10 years, and more and more actual examples have been established, which are supported by government and plants in China. It is well known that there are abundant wind and solar resources in China. This paper presents the distribution zone and development and application practice status in China. However, a common drawback is existing in the stand-alone wind energy and solar energy generating power system, which is the unpredictable output electric power, and the output power depends on the unpredictable weather and climatic changes. Fortunately, the wind–solar hybrid generation system can partially overcome the problems. The conventional structure and key technology of stand-alone wind–solar hybrid generating system, the current status and outlook of wind–solar hybrid energy system are presented in the paper, for example, the city road lighting system, distributed generation, photovoltaic (PV) water pumping for irrigation, etc. At the end, the policies and laws of China central government and local governments are described, and the development barriers and recommendations are introduced.     

Environmental effects of energy crop cultivation in Sweden—I: Identification and quantification

This paper presents an analysis of how energy crop cultivations in Sweden, consisting of short-rotation forest (Salix) and energy grass (reed canary grass), can be located and managed to maximise environmental benefits. The overall conclusion is that substantial environmental benefits, ranging from global to site-specific, could be achieved when traditional annual food crops produced with current agriculture practices are replaced by dedicated perennial energy crops. The emission of greenhouse gases could be reduced by reduced carbon dioxide emissions from organic soils, by reduced nitrous oxide emissions caused by the use of fertilisers and through accumulation of soil carbon in mineral soils, which also leads to increased soil fertility. Nutrient leaching could be reduced by using energy crop cultivations as buffer strips along open streams and wind erosion could be reduced by using Salix plantations as shelter belts. Cultivation of Salix and energy grass can also be used to purify municipal waste, such as waste water, landfill leachate, and sewage sludge. Furthermore, the content of heavy metals in the soil can be reduced through Salix cultivation. The biodiversity is estimated to be almost unchanged, or slightly increased in open farmland. These environmental benefits, which could be achieved on up to 60% of current Swedish arable land and last for 25 years or more, will increase the value of the energy crops. The economic value of these benefits is calculated in Part II of the analysis, which is presented in a second paper.     

UK energy policy – Stuck in ideological limbo?

Energy policy in the UK has undergone a paradigm change over recent decades – from the free market stance of the 1990s to the more interventionist measures of the 21st century. However, the two approaches have not been reconciled – even as the Government intervenes, it reaffirms its goal of creating more competitive markets. The contradictions are most apparent with electricity, which has been the main focus of intervention to date, in line with decarbonisation strategy. Investment is dependent on Government support, which changes in response to circumstances, creating uncertainty and undermining the basis of market operation – so leading to the need for more intervention. The future for other sources – natural gas, nuclear power and carbon capture and storage in particular – remains unclear. The Government risks getting the worst of both worlds – without the coordination and direction which could come from a centralised approach or the efficiencies and innovation which might emerge from a more consistent market based policy. Unless a fuller policy statement, expected later this year, can clarify matters, UK energy policy will not be fit for purpose and will fail to meet its key goals, of economic effectiveness, environmental protection and energy security.     

Existing buildings – Users,renovations and energy policy

This paper deals with the energy consumption of existing owner-occupied detached houses and the question of how they can be energy renovated. Data on the age of the Danish housing stock, and its energy consumption is presented. Research on the potential for energy reductions in the Danish housing sector is discussed, and it is shown that there is a huge potential for reductions. It is a well-known problem that even if there are relevant technical means and even if it is economically feasible, the majority of house owners do not energy renovate their homes. This paper intends to address what can be done to solve this problem. The paper draws on different sources of why, when, and how, people do not energy renovate their homes. These results are then compared and discussed together with a presentation and discussion of the Danish policy measures aimed at encouraging people to energy renovate their homes. These policy measures include building regulations, energy tax and different types of incentives and information dissemination. The conclusion calls for new and innovative policy measures to cope with the realities of renovations of owner-occupied houses and how energy efficiency improvement could be part of that.     

The roles of inter-fuel substitution and inter-market contagion in driving energy prices: Evidences from China’s coal market

Coal has been dominating energy supply and consumption in China, with the country becoming the largest energy supplier and consumer worldwide. Due to inter-fuel substitution of crude oil and inter-market contagion of international coal market, China's coal price might be interrelated with crude oil price and international coal price. However, the precise roles of these two effects in determining China's coal price are unknown. This paper contributes to previous literature by investigating this issue. We find that co-movements between China's coal price and crude oil price largely hinge on the shares of oil and coal in China’s energy mix, while its co-movements with international coal price depend on scales of coal trade. Inter-fuel substitution dominated the interaction of China's coal market with other energy types, but the importance of inter-market contagion has been increasing. We also find that China might have become an originator for driving the returns of crude oil and international coal, in particular after 2008. Furthermore, China's coal market is still a net volatility recipient for shocks from both crude oil market and international coal market. Given the increased integration of global energy markets, we anticipate this paper to provide a better understanding on the dynamic changes in China's coal prices.     

UK energy policy ambition and UK energy modelling—fit for purpose?

Aiming to lead amongst other G20 countries, the UK government has classified the twin energy policy priorities of decarbonisation and security of supply as a “centennial challenge”. This viewpoint discusses the UK's capacity for energy modelling and scenario building as a critical underpinning of iterative decision making to meet these policy ambitions. From a nadir, over the last decade UK modelling expertise has been steadily built up. However extreme challenges remain in the level and consistency of funding of core model teams — critical to ensure a full scope of energy model types and hence insights, and in developing new state-of-the-art models to address evolving uncertainties. Meeting this challenge will facilitate a broad scope of types and geographical scale of UK's analytical tools to responsively deliver the evidence base for a range of public and private sector decision makers, and ensure that the UK contributes to global efforts to advance the field of energy-economic modelling.     

The policy instruments of European front-runners: effective for saving energy in existing dwellings?

Existing dwellings receive frequent attention in climate change policy given the wealth of cost-effective, but un-exploited, energy-saving potential within their walls. Policy attention also recognises the need for instruments that can navigate around barriers and maximise opportunities to achieve deep carbon reductions. However, there is a lack of evidence and knowledge about the instruments that can boast of success. In response to this knowledge gap, the instruments that form the main policy response to reduce energy consumed for space and water heating in existing dwellings in several front-runner European countries are assessed. Aims are to include, and to go beyond, an understanding of effectiveness based on reported reductions in CO₂ emissions and/or monetary savings on energy bills. Effectiveness is also judged on the basis of how instruments reflect policy instrument and energy policy concepts drawn from literature. Results show that the instruments that define action of front-runners differ significantly. Front-runners fail to reconcile all the identified concepts in their main instruments but some feature strongly. In this regard, selected countries established their main instruments over two decades ago, reflecting the concept of long-term instrument development and support. However, few front-runners adequately monitor and evaluate instruments to illuminate cause and effect. Front-runners struggle to diversify their core instrument approaches to capture ‘hard to reach households’ such as the private rental sector and lower-income households. The divergence in the instruments that form the main policy response of front-runners allows for the characteristics of a range of instruments to be analysed including regulations, information tools, taxes and incentives.     

German Energiewende and the heating market – Impact and limits of policy

The German Energiewende envisages achieving a climate-neutral building stock in 2050 by means of two major pillars of regulation. First, residential buildings should consume 80% less primary energy and second; the remaining energy demand should be covered primarily with renewables. This paper simulates the future German heating market under different policy scenarios in order to evaluate the impact and limits of recent and conceivable policies. The investigation is based upon a dual model approach, linking a residential heating model to a discrete choice model. The major finding is that current regulations are not suitable for the achievement of governmental targets. Scenario calculations show that additional carbon emission reductions, triggered by the current regulatory regime, are falling short of expectations. In terms of economic efficiency, all calculated policy alternatives outperform the regulation currently in place. This allows to draw the conclusion that carbon emission reductions can be achieved without a major increase in cost. The model results highlight two policy implications. First, a rising mandatory share of renewables in the heating market is needed for target achievement and can be cost effectively. Second, renewable obligations for heating systems must include the existing building stock to achieve the postulated political targets.