What can we learn from high-frequency appliance-level energy metering? Results from a field experiment

This study uses high-frequency appliance-level electricity consumption data for 124 apartments over 24 months to provide a better understanding of appliance-level electricity consumption behavior. We conduct our analysis in a standardized set of apartments with similar appliances, which allows us to identify behavioral differences in electricity use. The Results show that households' estimations of appliance-level consumption are inaccurate and that they overestimate lighting use by 75% and underestimate plug-load use by 29%. We find that similar households using the same major appliances exhibit substantial variation in appliance-level electricity consumption. For example, households in the 75th percentile of HVAC usage use over four times as much electricity as a user in the 25th percentile. Additionally, we show that behavior accounts for 25–58% of this variation. Lastly, we find that replacing the existing refrigerator with a more energy-efficient model leads to overall energy savings of approximately 11%. This is equivalent to results from behavioral interventions targeting all appliances but might not be as cost effective. Our findings have important implications for behavior-based energy conservation policies.     

How does daylight saving time affect electricity demand? An answer using aggregate data from a natural experiment in Western Australia

Daylight saving time (DST) affects the lives of more than 1.6 billion people worldwide, with energy saving being the original rationale for its implementation. This study takes advantage of natural experiment data from September 2006 to March 2013 in Western Australia in which DST was observed from December 2006 to March 2009, to estimate the effect of DST on electricity demand. Using the difference-in-differences (DD) approach, we find that DST has little effect on overall electricity demand and electricity generation costs. However, it has a strong redistributional effect by reducing electricity demand substantially in the late afternoon and early evening. This redistributional effect of DST may be of particular interest for policymakers who are interested in controlling high demand and the short term energy market price.     

Hybrid,plug-in hybrid,or electric—What do car buyers want?

We use a survey to compare consumers’ stated interest in conventional gasoline (CV), hybrid (HEV), plug-in hybrid (PHEV) and pure electric vehicles (EV) of varying designs and prices. Data are from 508 households representing new vehicle buyers in San Diego County, California in 2011. The mixed-mode survey collected information about access to residential recharge infrastructure, three days of driving patterns, and desired vehicle designs and motivations via design games. Across the higher and lower price scenarios, a majority of consumers designed and selected some form of PHEV for their next new vehicle, smaller numbers designed an HEV or a conventional vehicle, and only a few percent designed an EV. Of those who did not design an EV, the most frequent concerns with EVs were limited range, charger availability, and higher vehicle purchase prices. Positive interest in HEVs, PHEVs and EVs was associated with vehicle images of intelligence, responsibility, and support of the environment and nation (United States). The distribution of vehicle designs suggests that cheaper, smaller battery PHEVs may achieve more short-term market success than larger battery PHEVs or EV. New car buyers’ present interests align with less expensive first steps in a transition to electric-drive vehicles.     

What drives public acceptance of second-generation biofuels? Evidence from Canada

North American publics are currently much more supportive of second-generation biofuels than of conventional biofuels like corn-based ethanol. But what is the likely future trajectory of consumer acceptance of advanced biofuels? This study considers whether increased awareness of the potential unintended consequences of increasing the production of advanced biofuels could lead to a decline in public support for the technology. Using an experiment embedded in an original survey of Canadian adults, we test for the effect of two anti-biofuels arguments on Canadians' support for policies meant to encourage the production of biofuels. We find that support for biofuels policies was reduced in our experiment when respondents were exposed to an argument about the potential impact of biofuels production on food prices and when they were told that the use of woody biomass as a feedstock for the production of cellulosic biofuels might lead to an increase in commercial logging. In both cases, however, support was reduced only among respondents who did not perceive climate change to pose a significant risk. Overall, our results suggest that public support for advanced biofuels is potentially vulnerable to arguments that focus on the unintended consequences of producing biofuels from non-food feedstocks.     

What are retail investors' risk-return preferences towards renewable energy projects? A choice experiment in Germany

Citizens own nearly half the renewable energy generation capacity in Germany and have been important drivers of the country's energy transition. In contrast to citizens' important role in financing renewable energies, the energy policy and economics literature has traditionally focused on other investors, such as incumbent energy firms. To close this gap, this paper reports on a large-scale survey of 1,990 German retail investors. Conducting a choice experiment with the subset of 1,041 respondents who expressed an interest in investing in community renewable energy projects, we present a unique dataset allowing for new insights in risk-return expectations of retail investors. We find that apart from return on investment, respondents are particularly sensitive to the minimum holding period and the issuer of community renewable energy investment offerings. A minimum holding period of 10 years implies a risk premium of 2.76% points. A subsequent segmentation analysis shows that two groups of potential community renewable energy investors with different risk-return expectations can be identified: “local patriots” and “yield investors”. In contrast to professional investors, a majority of retail investors use simple decision rules such as calculating payback time or relying on their gut feeling when making investments.     

What makes people adopt improved cookstoves? Empirical evidence from rural northwest Pakistan

Large dependence of the world population on biomass fuels for domestic energy consumption is one of the major anthropogenic causes of deforestation worldwide. The use of biomass in inefficient ways in rural areas increases fuelwood demand of a household. Development of the improved biomass stove programs in the 1970s has been one of the efforts to reduce burden on biomass resource base through reliable and efficient methods of energy consumption. However, despite having multiple economic, social, environmental, and health benefits; the improved stove dissemination programs failed to capture worldwide recognition. A wide array of socio-cultural, economic, political, and institutional barriers contributes to the low adoption rate of such programs. Drawing on field work surveys in rural northwest Pakistan, this paper provides empirical evidence of individual, household, and community level variables that play a vital role in the adoption of improved cookstoves. The study is based on primary data collected from 100 randomly selected households in two villages of rural northwest Pakistan. Using regression analysis, the study depicts that education and household income are the most significant factors that determine a household willingness to adopt improved biomass stoves. The study concludes that the rate of adoption could substantially be improved if the government and non-governmental organizations (NGOs) play a greater role in overcoming the social, economic, cultural, political, and institutional barriers to adopting improved cooking technologies.     

Avoiding adverse employment effects from electricity taxation in Norway: What does it cost?

Welfare analyses of energy taxes typically show that systems with uniform rates perform better than differentiated systems. However, most western countries include some exemptions for their energy-intensive export industries and thereby avoid this potential welfare gain. Böhringer and Rutherford (1997) find that uniform taxation of carbon emissions in combination with a wage subsidy preserves jobs in these industries at a lower welfare cost compared with a differentiated system. The wage subsidy scheme generates a substantial welfare gain per job saved. This study, however, finds that welfare costs are substantial when less accurate policy measures, represented by production-dependent subsidies, protect jobs in Norwegian electricity-intensive industries. The welfare cost per job preserved by this subsidy scheme amounts to approximately 60% of the wage cost per job, suggesting that these jobs are expensive to preserve. A uniform electricity tax combined with production-dependent subsidies preserves jobs at a lower welfare cost compared with the current differentiated electricity tax system.     

Who Benefits from a Resource Boom? Evidence from the Marcellus and Utica Shale Plays

We analyze the impact of the recent energy boom in the Marcellus and Utica shale formations on local labor markets in Ohio, Pennsylvania and West Virginia. Unique to our analysis is the use of origin-destination files (LODES) from the U.S. Census Bureau which provide employment statistics at the census block level based on where jobs are located and where workers live who hold those jobs. The richness of this data enables us to identify cross border mobility of workers as labor demand increases due to greater resource extraction. We find that increases in the value of new oil and gas production significantly increases local employment and average earnings in the county, but that a large fraction of new jobs are filled by workers who reside outside of the county. Specifically, a one standard deviation increase in the value of new oil and gas production per capita in a county-year increases workplace employment by 283 jobs, decreases the fraction of jobs held locally, and increases the flow of workers from counties 25-200 miles away. Furthermore, we find some positive employment spillovers across industries, but these new jobs largely appear to go to non-local residents as well. We do find evidence that the earnings distribution shifts to the right for both local residents and workers who reside outside the county.     

Are electricity risk premia affected by emission allowance prices? Evidence from the EEX,Nord Pool and Powernext

The links between emission and energy markets are of great interest to practitioners, academics and policy makers. In this paper, it is conjectured that a positive relationship exists between emission allowance spot returns and electricity risk premia within the European Union Emissions Trading Scheme (EU ETS). We discuss how this can be justified on the basis of the substantial uncertainties in the carbon markets. We also argue that this link could be due to trading strategies followed by electricity producers who attempt to exploit their initial allocation of free allowances. Analysis of data from three major markets, the EEX, Nord Pool and Powernext, offers empirical support to our conjecture. These findings have significant policy implications since they imply that efforts should be made in order to reduce the uncertainty in the carbon markets by clearly defining the EU ETS regulative framework and design over the next years. Moreover, our results suggest that the allocation of free allowances and their unrestricted trading enable electricity producers to accomplish windfall profits in the derivatives market at the expense of other market participants.     

What can we learn about commodity and credit cycles? Evidence from African commodity-exporting countries

This study analyzes the relationship between commodity prices and credit to the private sector in commodity-exporting developing countries, particularly three nations in Sub-Saharan Africa. In this regard, we extend the findings of non-empirical studies dealing with this issue for the case of African countries and complement the literature on the methodological side by investigating this relationship using wavelet analysis. This frequency approach is appropriate, as it takes into account investor heterogeneity and the time-variant characteristic of the studied relationship. Further, it explains the lead–lag relationship between the studied series. First, we observe that credit and commodities are strongly related over long timescales, suggesting that the credit market reacts strongly to long-term change in commodity markets and thus tends to be sensitive to persistent commodity shocks. Second, for medium and short timescales, the interaction is high and significant only during periods of turmoil. In terms of the lead–lag relationship, our results also show that the commodity market causes fluctuations in the credit market.     

Have commodities become a financial asset? Evidence from ten years of Financialization

The financialization of commodity markets over the last decade has changed the behavior of commodity prices in fundamental ways. In this paper, we uncover the gradual transformation of commodities from a physical to a financial asset. Although economic demand and supply factors continue to play an important role, recent indicators associated with financialization have emerged since 2008. We show that financial variables have become the main driving factors explaining the variation in commodity returns and volatility today. Our findings have important implications for portfolio analysis and for the effectiveness of hedging in commodity markets.     

How do the stock prices of new energy and fossil fuel companies correlate? Evidence from China

This study documents the return and volatility spillover effect between the stock prices of Chinese new energy and fossil fuel companies using the asymmetric BEKK model. Based on daily samples taken from August 30, 2006 to September 11, 2012, the dynamics of new energy/fossil fuel stock spillover are found to be significant and asymmetric. Compared with positive news, negative news about new energy and fossil fuel stock returns leads to larger return changes in their counter assets. News about both new energy and fossil fuel stock returns spills over into variances of their counter assets, and the volatility spillovers depend complexly on the respective signs of the return shocks of each asset. The empirical results demonstrate that new energy and fossil fuel stocks are generally viewed as competing assets, that positive news about new energy stocks could affect the attractiveness of fossil fuel stocks and that new energy stock investment is more speculative and riskier than fossil fuel stock investment. These results have potential implications for asset allocation, financial risk management and energy policymaking.     

What encourages local authorities to engage with energy performance contracting for retrofitting? Evidence from German municipalities

Municipalities aiming at mitigating climate change by implementing new energy efficiency technologies face budgetary and capacity constraints. Outsourcing through energy service contracting could provide a solution. This paper reports results from a survey of 1298 municipalities concerning barriers to retrofitting public street lighting and the possible role of energy service contracting to overcome these barriers. Using a logistic regression analysis, the authors investigate determinants of opting for energy service contracts in the specific context of LED retrofits. Results point to an advantage of outsourcing in a financially and capacity-constrained environment, which corresponds with the main reasons for engaging in contracting: minimising investments and financial risks. However, municipalities often do not fully grasp the risks associated with retrofitting especially using a novel technology such as LED. In relation to that they underestimate the risk reduction potential of energy performance contracts (EPC). Previous experience with outsourcing increases the probability to engage in servitization although certain existing partnerships, particularly with utilities, prevent municipalities from considering energy performance contracts. Interestingly, engaging an energy consultant has a negative propensity to use energy service contracts, while pre-negotiated standardised contracts for energy performance contracts have a positive influence.     

Sugar beet as a biogas substrate? A discrete choice experiment for the design of substrate supply contracts for German farmers

Biogas production using biomass of agricultural origin plays a key role in Germany's energy transition process. As the main substrate, maize usage has been increasingly criticized in recent years leading to a reduction of this crop for the use in biogas plants by an adjustment of Germany's Renewable Energy Sources Act in 2012. Thus, at least 800 biogas plants are obliged by law to find suitable substrate alternatives to maize. This study explores German farmers' willingness to grow sugar beets for biogas production based upon the analysis of a discrete choice experiment conducted with 118 arable farmers. Models are estimated in terms of willingness to accept. Results reveal that at least two-thirds of the participating farmers assess biogas production from sugar beets as a suitable alternative to maize. However, with respect to their own farms, farmers are rather reluctant to choose a contract. Findings also indicate that experience with growing energy crops on contract does not enhance contract acceptance. Furthermore, risk-averse farmers are more likely to contract sugar beet as a biogas substrate than less risk-averse farmers, resulting in a lower price demand. However, risk-averse farmers prefer short contract periods and a small share of their arable land for contracted production, otherwise they demand a markup. Regarding a viable biogas production from agricultural biomass, our study is useful for biogas plant operators, farmers and policy makers to gain insight into the contract design for a possible substrate alternative from the perspective of farmers.     

Is there a price premium for energy efficiency labels? Evidence from the Introduction of a Label in Korea

This study examines the price premium from Korea's Energy Efficiency Grade Label. The Korean government recently began energy certification of televisions, providing a setting to analyze a possible price effect of the new label. Hedonic regression results seem to show that a price premium exists for products with the Energy Efficiency Grade Label. However, potential unobserved heterogeneity is a concern. Difference-in-difference and fixed-effects models are used to capture the net effect of the label by controlling for time and product differences. The results suggest that any price premium does not result from the energy efficiency label itself. Instead, energy-efficient products already had higher prices before the introduction of the energy efficiency label. The finding turns our attention to the importance of careful design of labeling programs.     

Are fluctuations in coal consumption transitory or permanent? Evidence from a panel of US states

This short communication investigates whether or not US coal consumption follows a stationary process by examining coal consumption for the 50 US states over the period 1982–2007. Employing several panel unit root and stationarity tests with endogenously determined structural breaks, the results indicate that coal consumption is integrated of order zero. Thus, energy conservation policies oriented towards the reduction of coal consumption will only have short-term effects.     

Are fluctuations in energy consumption per capita transitory? Evidence from a panel of Pacific Island countries

This study applies the panel stationarity test developed by [Carrion-i-Silvestre et al 2005. Breaking the panels: An application to GDP per capita. Econometrics Journal 8, 159–175] to examine the stationarity of energy consumption per capita for a panel of 13 Pacific Island countries over the period 1980–2005. This test has the advantage that it allows for multiple structural breaks at unknown dates that can differ across countries and can account for all forms of cross-sectional correlation between countries. The conclusion from the study is that energy consumption per capita in approximately 60% of countries is stationary and that energy consumption per capita for the panel as a whole is stationary. The study offers several suggestions for modelling energy consumption and policy-making in the Pacific Islands.     

Does financial development have a non-linear impact on energy consumption? Evidence from 30 provinces in China

This paper uses a sample of 30 provinces in China for the period 1997–2017 to examine the relationship between financial development and energy consumption. Based on the traditional convergence hypothesis, this paper constructs a functional convergence model and explores the dynamic convergence of energy consumption. The results show that there is a significant threshold effect between financial development and energy consumption. There is an inverse-U shaped relationship between foreign investment ratio, financial efficiency, and energy consumption. Besides, financial interrelations ratio and insurance depth increase energy consumption. The trend of China's energy consumption tends to be consistent. In the eastern region, the growth rate of energy consumption is negatively correlated with the initial level. There is only a σ convergence effect on energy consumption in the central region. However, the difference in energy consumption in the western region is continually expanding.     

Technology interactions among low-carbon energy technologies: What can we learn from a large number of scenarios?

Advanced low-carbon energy technologies can substantially reduce the cost of stabilizing atmospheric carbon dioxide concentrations. Understanding the interactions between these technologies and their impact on the costs of stabilization can help inform energy policy decisions. Many previous studies have addressed this challenge by exploring a small number of representative scenarios that represent particular combinations of future technology developments. This paper uses a combinatorial approach in which scenarios are created for all combinations of the technology development assumptions that underlie a smaller, representative set of scenarios. We estimate stabilization costs for 768 runs of the Global Change Assessment Model (GCAM), based on 384 different combinations of assumptions about the future performance of technologies and two stabilization goals. Graphical depiction of the distribution of stabilization costs provides first-order insights about the full data set and individual technologies. We apply a formal scenario discovery method to obtain more nuanced insights about the combinations of technology assumptions most strongly associated with high-cost outcomes. Many of the fundamental insights from traditional representative scenario analysis still hold under this comprehensive combinatorial analysis. For example, the importance of carbon capture and storage (CCS) and the substitution effect among supply technologies are consistently demonstrated. The results also provide more clarity regarding insights not easily demonstrated through representative scenario analysis. For example, they show more clearly how certain supply technologies can provide a hedge against high stabilization costs, and that aggregate end-use efficiency improvements deliver relatively consistent stabilization cost reductions. Furthermore, the results indicate that a lack of CCS options combined with lower technological advances in the buildings sector or the transportation sector is the most powerful predictor of high-cost scenarios.     

Can exchange rate pass-through explain the asymmetric gasoline puzzle? Evidence from a pooled panel threshold analysis of the EU

This study contributes to the literature since it tries to link the Exchange Rate Pass-Through (ERPT) with the “rockets and feathers” hypothesis using a panel of EU-28 countries. Allowing for the existence of an endogenous threshold variable our empirical findings indicate that the threshold model is better suited to this analysis than the baseline linear adjustment model. This is the case since the latter restricts the threshold to be centered around zero and the dynamic response to cumulative shocks cannot be properly identified. The empirical findings reveal that the threshold variable expressed by the trade-weighted dollar exchange rate index is statistically significant only in the sample above the threshold (high regime). This means that for the net EU exporting countries, fluctuations in the real effective exchange rate of the US against its major EU trading partners do affect the level of pre-tax retail gasoline prices with the relevant elasticity exceeding unity (complete ERPT). Moreover, all the statistical tests reject the null hypothesis that there is no significant threshold and thus an asymmetric adjustment gasoline mechanism prevails. The impulse response functions confirm our empirical findings that ERPT can explain asymmetric gasoline pricing within the EU periphery.