Governance and political consumerism in Finnish energy policy-making

The research task in the study was, firstly, to analyse citizens’ perceptions of the power structure underlying Finnish energy policy-making. Secondly, we analysed the role of civil society in the energy sector, addressing the question whether Finns feel that they can influence energy policy-making as citizens through general elections (civic participation) or as consumers via their own consumption choices (political consumerism). Methodologically, the study was based on postal survey conducted in 2007 among a random sample representing 18–75-year-old Finns (N=4000). According to the views expressed, the innermost core of the influence structure of Finland's energy policy-making today comprises only the Cabinet and Parliament, while the second circle is composed of energy-producer firms and big firms. The European Union, the Ministry of the Environment and the Ministry of Trade and Industry belong to the third circle of influence. The power relations in Finland's energy sector have continued particularly stable since the late 1980s despite the liberalization and globalization of the energy markets. In order to influence energy policy-making, citizens consider their own consumption choices more useful than voting in elections or contacts with MPs, authorities and energy-producing companies. The least useful devices are radical environmental activism and participation in mass demonstrations.     

Comparing linear and nonlinear forecasts for Taiwan's electricity consumption

This paper uses linear and nonlinear statistical models, including artificial neural network (ANN) methods, to investigate the influence of the four economic factors, which are the national income (NI), population (POP), gross of domestic production (GDP), and consumer price index (CPI) on the electricity consumption in Taiwan and then to develop an economic forecasting model. Both methods agree that POP and NI influence electricity consumption the most, whereas GDP the least. The results of comparing the out-of-sample forecasting capabilities of the two methods indicate the following. (1) If given a large amount of historical data, the forecasts of ARMAX are better than the other linear models. (2) The linear model is weaker on foretelling peaks and bottoms regardless the amount of historical data. (3) The forecasting performance of ANN is higher than the other linear models based on two sets of historical data considered in the paper. This is probably due to the fact that the ANN model is capable of catching sophisticated nonlinear integrating effects through a learning process. To sum up, the ANN method is more appropriate than the linear method for developing a forecasting model of electricity consumption. Moreover, researchers can employ either ANN or linear model to extract the important economic factors of the electricity consumption in Taiwan.     

Energy consumption and economic growth: The case of oil exporting countries

This paper examines the causal relationship between the per capita energy consumption and the per capita GDP in a panel of 11 selected oil exporting countries by using panel unit-root tests and panel cointegration analysis. The results show a unidirectional strong causality from economic growth to energy consumption for the oil exporting countries. The findings have practical policy implications for decision makers in the area of macroeconomic planning. In most major oil exporting countries, government policies keep domestic prices bellow free market level, resulting in high levels of domestic energy consumption. The results imply that the energy conservation through reforming energy price policies has no damaging repercussions on economic growth for this group of countries.     

Connecting political economies of energy in South Africa

The South African energy debate is and will remain a heated one. Given South Africa's history of racial inequality and contemporary concerns around sustainability, much of it rightly focuses on the links between energy, poverty and the environment. Yet, many contributions to the (mainstream) debate seem to have a somewhat one-sided focus that might hamper rather than stimulate the understanding of these links. They either display a strong technical, quantitative bias and/or lean towards rather simplistic ideas about policy processes and dynamics. The article argues that many of these analyses could benefit greatly from a critical focus on the political economy of energy: the political–economic power structures that influence both many energy policies and the issues of energy equality and sustainability. Two major global developments emphasise the importance of this focus: the recent financial crisis and South Africa's role in the increasingly tense geopolitics of energy in Africa. The article concludes with some suggestions on how currently disparate political economies of energy could be better connected.     

China's oil reserve forecast and analysis based on peak oil models

In order to forecast future oil production it is necessary to know the size of the reserves and use models. In this article, we use the typical Peak Oil models, the Hu–Chen–Zhang model usually called HCZ model and the Hubbert model, which have been used commonly for forecasting in China and the world, to forecast China's oil Ultimate Recovery (URR). The former appears to give more realistic results based on an URR for China of 15.64 billion tons. The study leads to some suggestions for new policies to meet the unfolding energy situation.     

Energy paradox and political intervention: A stochastic model for the case of electrical equipments

This paper develops a model that explains the delay of decisions to adopt profitable energy-saving investments. This problem is known as the energy paradox. The model rationalizes the profitability requirements raised by the irreversibility, the uncertainty and the decrease of costs as a result of learning by doing. In this context, the wait gives investors more visibility and more lower investment costs, which gives them an option value. The representative agent has an interest to postpone its energy saving decision until future benefits increase and equalize its required option value. Formally, we internalize these explanatory factors in a stochastic model where the updated energy saving benefits follows a geometric Brownian motion. To affirm the capacity of the model, we generate simulation results for two equipments for electrical uses. Beyond that, we extend the model to simulate the effects of energy policy instruments to promote adoption of such equipments. Simulations prove that the taxation of energy prices is likely to be more effective than the subsidy for energy-saving equipments. It is also found that the combination of these instruments amplifies the adoption of energy-saving equipments and generates very favorable economic and environmental externalities.     

A system dynamic model for production and consumption policy in Iran oil and gas sector

A system dynamic model is presented, which considers the feedback between supply and demand and oil revenue of the existing system in Iran considering different sectors of the economy. Also the export of the oil surplus and the injection of the gas surplus into the oil reservoirs are seen in the model by establishing a balance between supply and demand. In this model the counter-effects and existing system feedbacks between supply and demand and oil revenue can be seen considering different sectors of the economy. As a result, the effects of oil and gas policies in different scenarios for different sectors of Iran’s economy together with the counter-effects of energy consumption and oil revenue are examined. Three scenarios, which show the worst, base and ideal cases, are considered to find future trends of major variables such as seasonal gas consumption in power plants, seasonal injected gas in oil reservoirs, economic growth in the industrial sector, oil consumption in the transportation sector, industrial gas consumption and exported gas. For example, it is shown that the exported gas will reach between 500 and 620 million cubic-meter per day in different scenarios and export revenues can reach up to $500 billion by 2025.     

Energy requirements of consumption: Urban form,climatic and socio-economic factors,rebounds and their policy implications

Household consumption requires energy to be used at all stages of the economic process, thereby directly and indirectly leading to environmental impacts across the entire production chain. The levels, structure and determinants of energy requirements of household consumption therefore constitute an important avenue of research. Incorporating the full upstream requirements into the analysis helps to avoid simplistic conclusions which would actually only imply shifts between consumption categories without taking the economy wide effects into account. This paper presents the investigation of the direct and indirect primary energy requirements of Australian households, contrasting urban, suburban and rural consumption patterns as well as inter- and intra-regional levels of inequality in energy requirements. Furthermore the spatial and socio-economic drivers of energy consumption for different categories of energy requirements are identified and quantified. Conclusions regarding the relationships between energy requirements, household characteristics, urban form and urbanization processes are drawn and the respective policy implications are explored.     

The single energy market and energy policy: conflicting agendas?

This paper examines the prospects for European energy policy in the light of the European Commission's proposals for an internal energy market. It reviews the history of attempts to create a common energy policy, concentrating on the 1980s. It considers whether or not there is a conflict between the traditional objectives of energy policy — limiting vulnerability to energy shocks — and the goals of the internal energy market — which would open the sector to market forces — by illustrating how the two agendas for energy policy address specific energy issues.     

Energy shocks,crises and the policy process: A review of theory and application

What motivates changes in energy policy? Typically, the process begins with a notable exogenous event, a shock. Often, the shock leads to what is perceived to be a crisis. This review essay surveys theories of crisis policymaking from the social science literature and considers their application to changes in energy policy. Two cases—one from the U.S., the other from Germany—are examined in more detail from the standpoint of the theories discussed. Suggestions are made for improving energy policy analysis in the future.     

An analysis of the welfare and distributive implications of factors influencing household electricity consumption

The deep economic crisis and the sharp rise in electricity prices have reduced electricity demand by Spanish households. This paper aims to analyse the responsiveness of household electricity demand and the welfare effects related to both factors in the 2006–2012 period by applying a demand model estimated with the quantile regression method. The results show that the electricity consumption of medium-high income households is particularly responsive to price increases, whereas that of medium-low income households is more responsive to changes in income. The retail electricity price increases and the economic crisis have led to lower and steeper U-shape price elasticities of demand and higher and steeper N-shape income elasticities of demand. The joint impact of those two factors on the welfare of lower-income households is higher in relative terms (i.e., as a share of household income) than for other income groups. These results suggest that the economic crisis and increases in retail electricity prices have had detrimental welfare effects, especially on the lower-income segment of the population. They should be considered when financing climate and energy policies through the electricity bill and provide a rationale to take such support, which pushes the retail electricity price upwards, out of the electricity bill.     

An evaluation of errors in US energy forecasts: 1982–2003

Planners, policy-makers, and the private sector rely on energy forecasts to help make policy and investment decisions. In the US, the federal Department of Energy (through the Energy Information Administration and its predecessors) has conducted national forecasts of energy production and consumption for decades. This paper explores US energy forecasts in order to uncover potential systemic errors in US forecasting models. We apply an error decomposition technique to forecasts within each major energy sector (commercial, industrial, residential, and transportation) made during the period 1982 to 2003. We find that low errors for total energy consumption are concealing much larger sectoral errors that cancel each other out when aggregated. For example, 5-year forecasts made between 1982 and 1998 demonstrate a mean percentage error for total energy consumption of 0.1%. Yet, this hides the fact that the industrial sector was overestimated by an average of 5.9%, and the transportation sector was underestimated by an average of 4.5%. We also find no evidence that forecasts within each sector have improved over the two decades studied here.     

The relationship among energy prices and energy consumption in China

The pricing mechanism for energy is not in line with the international standards, because the energy prices are controlled by the government partly or completely in China. Chinese government made a lot of efforts to improve the pricing mechanism for energy. The relations between Chinese energy prices and energy consumption are the foundations to reform the mechanism. In this paper, the relations between Chinese energy consumption and energy prices are researched by cointegration equations, impulse response functions, granger causality and variance decomposition. The cointegration relations among energy prices, energy consumption and economic outputs show that higher energy price will decrease energy consumption in Chinese industrial sectors but will not reduce the economic output in the long run. The cointegration relation between energy price and household energy consumption shows that higher energy price will decrease household energy consumption in the long run and increase it in the short run. So Chinese government should deepen the reform of pricing mechanism for energy, and increase the energy prices reasonably to save energy.     

Uncertainties and risks in transitions to sustainable energy,and the part ‘trust’ might play in managing them: a comparison with the current pension crisis

Transition to a sustainable energy future carries uncertainties for all stakeholders, including those who research it. History does not repeat itself in detail, yet comparison with analogous processes already completed or in train could give shape to how we project the future.     

Improvement of energy demand forecasts using swarm intelligence: The case of Turkey with projections to 2025

The energy supply and demand should be closely monitored and revised the forecasts to take account of the progress of liberalization, energy efficiency improvements, structural changes in industry and other major factors. Medium and long-term forecasting of energy demand, which is based on realistic indicators, is a prerequisite to become an industrialized country and to have high living standards. Energy planning is not possible without a reasonable knowledge of past and present energy consumption and likely future demands. Energy demand management activities should bring the demand and supply closer to a perceived optimum. Turkey's energy demand has grown rapidly almost every year and is expected to continue growing. However, the energy demand forecasts prepared by the Turkey Ministry of Energy and Natural Resources overestimate the demand. Recently many studies are performed by researchers to forecast the energy demand of Turkey. Particle swarm optimization (PSO) technique has never been used for such a study. In this study a model is proposed, using PSO-based energy demand forecasting (PSOEDF), to forecast the energy demand of Turkey more efficiently. Although there are other indicators as well, gross domestic product (GDP), population, import and export are used as basic energy indicators of energy demand. In order to show the accuracy of the algorithm, a comparison is made with the ant colony optimization (ACO) energy demand estimation model which is developed for the same problem.     

Eastern Canadian crude oil supply and its implications for regional energy security

Canada has been blessed with immense energy resources; however, their distribution is not uniform. One such example is crude oil, which is found primarily in western Canada. Eastern Canada, consisting of the six eastern-most provinces (Newfoundland and Labrador, New Brunswick, Nova Scotia, Ontario, Prince Edward Island, and Quebec), produce limited quantities of crude oil, most of which is exported to the United States. Ideally, western Canadian crude oil would meet the demands of eastern Canada; however, the North American Free Trade Agreement (NAFTA) and the absence of oil pipelines means that eastern Canada increasingly relies on supplies of crude oil from a small number of oil exporting countries, many with declining production.     

The experience curve,option value,and the energy paradox

This paper develops a model to explain the ‘energy paradox,’ the inclination of households and firms to require very high internal rates of return in order to make energy-saving investments. The model abstracts from many features of such investments to focus on their irreversibility, the uncertainty of their future payoff streams, and the investor's anticipation of future technological advance. In this setting, the decision to invest in energy-saving technology can be delayed, providing option value. In addition, delay allows the potential investor to cash in on future experience-curve effects: With the passage of time, firms gain practical knowledge in producing and installing the energy-saving technology, enabling them to reduce the technology's up-front cost per unit of energy saved. We incorporate these fundamentals into a stochastic model where the investment's discounted benefits follow geometric Brownian motion. To demonstrate the model's capabilities, we generate simulation results for photovoltaic systems that highlight the experience-curve effect as a fundamental reason why households and firms delay making energy-saving investments until internal rates of return exceed values of 50% and higher, consistent with observations in the economics literature. We also explore altruistic motivations for energy conservation and the model's implications for both “additionality” and the design of energy-conservation policy.     

Analysis of policies to reduce oil consumption and greenhouse-gas emissions from the US transportation sector

Even as the US debates an economy-wide CO₂ cap-and-trade policy the transportation sector remains a significant oil security and climate change concern. Transportation alone consumes the majority of the US’s imported oil and produces a third of total US Greenhouse-Gas (GHG) emissions. This study examines different sector-specific policy scenarios for reducing GHG emissions and oil consumption in the US transportation sector under economy-wide CO₂ prices. The 2009 version of the Energy Information Administration’s (EIA) National Energy Modeling System (NEMS), a general equilibrium model of US energy markets, enables quantitative estimates of the impact of economy-wide CO₂ prices and various transportation-specific policy options. We analyze fuel taxes, continued increases in fuel economy standards, and purchase tax credits for new vehicle purchases, as well as the impacts of combining these policies. All policy scenarios modeled fail to meet the Obama administration’s goal of reducing GHG emissions 14% below 2005 levels by 2020. Purchase tax credits are expensive and ineffective at reducing emissions, while the largest reductions in GHG emissions result from increasing the cost of driving, thereby damping growth in vehicle miles traveled.     

Summoning earth and fire: The energy development implications of Grameen Shakti (GS) in Bangladesh

Since its establishment in 1996, the nonprofit company Grameen Shakti (GS) has installed almost half a million solar home systems (SHS), 132,000 cookstoves, and 13,300 biogas plants among 3.1 million beneficiaries. They plan to ramp up their expansion so that by 2015, more than 1.5 million SHS are in place along with 100,000 biogas units and 5 million improved cookstoves. This article describes GS’s current activities, the contours of its programs, and likely reasons for its success. It also explores the remaining challenges facing GS and distils common lessons for other energy development assistance projects and programs around the world. After detailing research methods consisting primarily of research interviews and site visits, the article briefly explores the history of GS and summarizes its three most prominent programs. The article then identifies six distinct benefits to their programs—expansion of energy access, less deforestation and fewer greenhouse gas emissions, price savings, direct employment and income generation, improved public health, and better technology—before discussing challenges related to staff retention and organizational growth, living standards, technical obstacles, affordability, tension with other energy programs, political constraints, and awareness and cultural values.     

The macroeconomic impact of oil earnings uncertainty: New evidence from analyst forecasts

We develop measures of oil earnings uncertainty (OEU) using analyst forecasts drawn from a large firm-level dataset. OEU is related to future economic downturns, so some OEU measures may serve to forecast future downturns. An increase in OEU also has adverse effects on the US oil sector. The results are robust to conditioning on aggregate uncertainty. At the same time, OEU is related to increases in stock prices – unlike aggregate uncertainty, which has the opposite effect. OEU is thus an independent influence on both the oil industry and on economic aggregates.