Cost drivers of operating charges and variation over time: An analysis based on semiparametric SUR models

Although building operating charges have turned out to be a major determinant of profitability for real estate investments, there is a noticeable lack of reports or studies that analyze these costs with state-of-the-art statistical techniques. Specifically, past studies usually assume linear relationships between costs and building attributes, they do not control for cluster-specific or longitudinal effects and do not account for the simultaneous structure of cost categories. Therefore, in this study we provide a novel approach to real estate cost benchmarking: we analyze the effects of building attributes on electricity, heating and maintenance costs for office buildings in Germany in a multivariate structured additive regression (STAR) model simultaneously, modeling potentially nonlinear effects as P(enalized)-splines and controlling for cluster-specific and individual heterogeneity in a three-way random effects structure. This way, we gain insights into how building attributes influence costs, and how cost levels vary across cities, companies and buildings. We furthermore construct quality-adjusted time indexes for the two major German submarkets. The results obtained can be used to derive portfolio allocation strategies and for planning, constructing, operating and redeveloping real estate.     

Efficient resource utilization of the electricity distribution sector using nonparametric data envelopment analysis and influential factors

This study aims to investigate the efficient resource utilization of the electricity distribution sector in Pakistan and identifies the influential factors affecting it. In Pakistan, there is excess production capacity and under-utilized power plants, which pose a challenge to the economy due to their burden on the exchequer account and the high power costs. The present study employs the most recent 11 distribution firms panel data from Pakistan for the period 2016–2020 to evaluate the performance ranking of distribution utilities. The study employs standard frontiers, composite indexes, and a novel DEA-windows analysis to measure the efficiency of the distribution utilities. The results of the analysis show that electricity sales, consumer density, and industrial consumers have a positive impact, while distribution losses have a negative association with the efficiency of the distribution utilities. These findings provide valuable insights for policymakers and industry stakeholders in improving the resource utilization and overall performance of the electricity distribution sector. The study highlights the implications of the results in terms of reducing greenhouse gas emissions, which are one of the main contributors to global warming. In conclusion, this study provides an essential contribution to the literature on efficient resource utilization in the electricity distribution sector in Pakistan.     

The potential of public participation to facilitate infrastructure decision-making: Lessons from the German and European legal planning system for electricity grid expansion

The article examines the potential role that public engagement and participative pro-cesses to play a role in effective infrastructure planning in the context of energy policies. For example, by 2050, at least 80% of Germany’s electricity has to be derived from re-newable energy sources if Germany is to meet the goals of its own energy policy. This includes the comprehensive and accelerated extension of the electricity grid. As a result of the magnitude of these changes, the German energy transition is not proceeding without debate and controversy. Public engagement is certainly no panacea for en-hanced social acceptance, yet it offers substantial potential to facilitate the energy tran-sition. The paper draws together social science and legal expertise in order to investi-gate the role of public participation in legal planning processes concerning energy infra-structures. The paper not only focuses on the extension of the German power grid, but also deals with participative policy at the European level. To this end, the paper analyzes the potential role of the German legal planning system in grid expansion and in the Eu-ropean processes of nominating Projects of Common Interest (PCI) and of drawing up the Ten Year Network Development Plan (TYNDP).     

Decrease in CO2 emission per capita as a result of the reduction in power grid losses in Iran

ABSTRACT

In power grids, a significant amount of the generated power in power plants is wasted in the grid between power plants and consumers. The amount depends on different factors. With regard to the vital role of electricity in economic and social development alongside with high investment costs in electricity generation, transmission and distribution, practical solutions for decreasing grid losses and enhancing the efficiency of existing facilities are crucial. Due to the global environmental situation and significant effects of energy consumption on the environment, the general trend is towards the deployment of methods which are more efficient and less fuel consuming. In addition, more implementation of monitoring and controlling equipment and instalment of more efficient equipment in electricity transmission and distribution sectors reveal the effort towards the reduction of pollutants. These facts reveal the importance of this issue amongst authorities in the power industry. In this research through the assessment of power grid losses and studying different types of power plants in Iran, the amount of electricity generation and grid loss are studied. In addition, the impact of different power plants on the amount of environmental pollutants especially CO₂ is presented. Also, some solutions to reduce CO₂ emission are provided.     

Exploring options for a 100% renewable energy system in Mauritius by 2050

This paper aims at critically analyzing the present and the proposed energy resource mix in Mauritius in order to make recommendations for a 100% renewable energy system for the island by 2050. While the Long Term Energy Strategy for the period 2009–2025 devised by the Government of Mauritius sets pathways for the future in a sustainable manner, it does not evaluate the feasibility of the options that will help in supporting this transition. Its scope is limited as the proposed framework aims at achieving only 35% self-sufficiency in terms of electricity supply by 2025 against 20% currently. This paper explores the main building blocks of a new energy paradigm by extending the analysis to 2050 in view of identifying systemic and holistic policies and strategies that will pave the way to a clean and efficient energy supply. Most notably, we look beyond electricity only to assess the energy system comprehensively in terms alternative resources for primary uses, including energy-intensive transportation and cooling. Ultimately, it also enhances the near-term energy framework by setting more ambitious green energy targets as a stepping-stone towards 100% energy self-sufficiency by 2050.     

Bulgarian electricity market restructuring

The energy sector in Bulgaria has undergone major restructuring in recent years. It faces the dual challenges of achieving regulatory stability to attract private investors, and creating a functioning competition energy market. As of the EU Accession in 2007, Bulgaria has fully liberalized power and gas markets. The 2003 Energy Law establishes the energy sector legal framework and sets the basis for creation of a transparent and predictable regulatory environment where the key regulatory responsibilities are vested with the State Energy and Water Regulatory Commission (SEWRC).The energy sector experienced significant problems in the first half of 2007 due to lost production capacities and regulatory failures on the electricity market. Excess price regulations on the market of electricity supplies to household, coupled with insufficient liberalization of imports and exports, create unfavorable conditions for power producers and large electricity users. The energy regulator has tried to achieve several incompatible targets as of July 1, 2007 for maintaining low electricity prices for households in response to political pressure, low power generation prices amid rising input costs, and market opening in compliance with EU regulations.     

Market power in the Nordic electricity market

This paper investigates the potential for market power in the Nordic electricity power market. Numerical simulations have been conducted using ECON's model for the electricity market. A special case of a supply curve equilibrium model is used to describe strategies of the large producers. The conclusion is that the largest producer, Vattenfall, has incentives to withdraw some nuclear capacity from the market in order to raise spot market prices. However, Vattenfall's incentives are to some extent limited by the excess capacity of the smaller producers. The model also indicates that it may be profitable for Vattenfall to operate its nuclear plants at full capacity if market prices increase due to exogenous factors, e.g. consumption growth. The simulations do not indicate that hydro production will be withheld, because of the low marginal operating costs in these plants.     

Regulatory practice and politics: Lessons from independent regulation in Indian electricity

Although independent regulatory agencies are emerging worldwide, there remains little understanding about how they operate in practice, particularly in developing countries. This paper seeks to examine the practice of electricity regulation in India, using case studies of three state-level electricity regulators. Based on documentary analysis and interviews with regulators, government, utilities and stakeholders, the paper examines how regulation is shaped by institutional and political context, how regulators make decisions in practice, and how they engage with stakeholders and with what effects.Based on the Indian experience, we suggest that in a rapidly changing electricity sector, the separation between the political and economic content of regulatory decisions, as is often advocated, may not be feasible or indeed desirable. Instead, we suggest a more proactive regulatory approach where governments give regulators the latitude to proactively steer the sector. For this approach to be viable, regulators need to build adequate technical capacity, institutional legitimacy, and democratic legitimacy in their dealings with stakeholders. This approach entails a bolder, and more challenging vision of regulation, but one that promises greater transformational potential than does the model of technocratic and apolitical regulation.     

Electricity reform in the Republic of Macedonia

In contrast to some other countries in the South East European region, there has been privatization in the Macedonian electricity sector, and today the government has a majority stake in very few companies. After 2002, the focus of domestic policy shifted to compliance with the EU Energy Directives. The main obstacles to reform arise from low payment discipline, with state institutions among the problem customers, and the fact that prices do not match costs. In order to reduce the adverse effects of the inevitable electricity prices increase to more realistic levels, the paper suggests that sustainable social support mechanisms need to be developed, and proposes some options.     

A coordinated strategic reserve to safeguard the European energy transition

In Germany and beyond, various capacity mechanisms are currently being discussed with a view to improving the security of electricity supply. One of these mechanisms is a strategic reserve that retains generation capacity for use in times of critical supply shortage. We argue that strategic reserves have specific advantages compared to other capacity mechanisms in the context of the European energy transition. To date, however, the debate on capacity mechanisms has largely been restricted to national contexts. Against this background, we discuss the feasibility and potential benefits of coordinated cross-border strategic reserves to safeguard electricity supply and aid the energy transition in Germany and neighboring countries at large. Setting aside strategic reserve capacity which is deployed only in the event of extreme supply shortages could improve the security of electricity supply without distorting the EU's internal electricity market. In addition, overall costs may decrease when reserve procurement and activation are coordinated among countries, particularly if combined with flow-based market coupling.     

Role of solar agricultural-drying in developing countries

The Swedish Dower system is today based on hydro power (production 65 TWh/year) and nuclear power (production 55 TWh/year from 1986). Small amount of oil and gas is used for power production during peak periods.

The Swedish Parliament decided in 1980, after a consultative referendum, that all nuclear reactors will be closed between 1997 and 2010. In that perspective several new technologies are possible to use for power production. One interesting possibility is photovoltaic power production.

The objective of the paper is to analyse conditions for the use of photovoltaics in the Swedish power system.

The cost for electricity from photovoltaic power plants is calculated from cost goals in the United States photovoltaic development programme. Different costs during construction and operation are added. The capital costs are calculated for a real discount rate of 4% and the lifetime for the plant is assumed to be 30 years.

The receipts for photovoltaics are calculated from long run marginal revenues (power values) at year 2010.

The calculations give following results. If the lower cost goal for late 1990s is achieved, then electricity from photovoltaic power plants in Sweden will cost 3.6 pence/kwh (40 öre/kwh). The higher cost goal for 1990s results in an energy cost of 4.6 pence/kwh (51 öre/kWh). The cost for electricity from photovoltaic power plants will be the same as the cost for electricity from coal-fired power plants if the coal price rises from UK £ l.3/GJ during 1983 to UK £3.4–4.5/GJ around the decade 2000–2010.     

Quantifying energy demand reduction considering householder willingness to apply measures

ABSTRACT

Reducing energy demand in the domestic sector will be an important feature of future energy systems but is challenging to achieve in practice. Solutions lie in a range of building fabric and system improvements as well as adopting more sustainable routines and conceptions of normality in the home. The impact of such measures has so far been quantified without considering the willingness of the householder to adopt them. This paper uses a modelling approach to evaluate the effectiveness of technical and lifestyle measures to reduce energy demand in six households based on monitoring data and insights from interviews. The results are benchmarked against estimated tailored 2050 reduction targets and demonstrate that although these targets are achievable in the studied homes, householders might not always be willing to apply them. The resultant reduction pathways are shown to vary significantly between households, suggesting that bespoke strategies are needed to allow households to identify and select the most appropriate methods that allow them to maximize demand reduction.     

Primary energy implications of end-use energy efficiency measures in district heated buildings

In this study we explore the effects of end-use energy efficiency measures on different district heat production systems with combined heat and power (CHP) plants for base load production and heat-only boilers for peak and medium load productions. We model four minimum cost district heat production systems based on four environmental taxation scenarios, plus a reference district heat system used in Östersund, Sweden. We analyze the primary energy use and the cost of district heat production for each system. We then analyze the primary energy implications of end-use energy efficiency measures applied to a case-study apartment building, taking into account the reduced district heat demand, reduced cogenerated electricity and increased electricity use due to ventilation heat recovery. We find that district heat production cost in optimally-designed production systems is not sensitive to environmental taxation. The primary energy savings of end-use energy efficiency measures depend on the characteristics of the district heat production system and the type of end-use energy efficiency measures. Energy efficiency measures that reduce more of peak load than base load production give higher primary energy savings, because the primary energy efficiency is higher for CHP plants than for boilers. This study shows the importance of analyzing both the demand and supply sides as well as their interaction in order to minimize the primary energy use of district heated buildings.     

Revenue decoupling,energy demand,and energy efficiency: Empirical evidence from the U.S. electricity sector

This paper investigates the relationship between the regulatory policy revenue decoupling, which separates utilities’ revenue from sales fluctuations, and electricity customers’ energy demand and efficiency in the U.S. electricity sector. To this end, we use recent Stochastic Frontier Analysis estimation techniques that account for both persistent and transient energy efficiency. The results show a significant negative correlation between decoupling and electricity consumption. However, the implementation year, which serves as a reference for price adjustments, is associated with increasing electricity demand and decreasing transient energy efficiency. Therefore, utilities seem to anticipate the implementation of decoupling, which partially offsets the benefits.     

Contribution of ocean thermal energy conversion to world energy needs

Ocean Thermal Energy Conversion (OTEC) can provide energy to all countries. It can deliver the energy (i) to regions bordered by warm ocean waters via direct electric-power transmission or (ii) to other areas not bordered by warm ocean waters, via an energy-intensive material produced on OTEC plant-ships cruising on the high seas in the tropics. Ammonia is an outstanding choice for an energy-intensive material because it can (a) replace ammonia now made from natural gas to conserve fuel, (b) serve as a synthetic fuel, or (c) provide an easily transported, storable source of hydrogen for fuel cells to generate electric power where needed anywhere in the world. Costs of OTEC ammonia and of electricity delivered directly or via fuel cells are projected to be competitive with costs of electricity from coal or nuclear plants by 1990, if rapid OTEC development is pursued.     

Electricity reform in Romania

Romania is a net exporter of electricity to the SE Europe region. Its performance of this role will increase in importance with (a) the completion of another nuclear generator and (b) improvement in capacity for international transmission. Romania has committed itself to an electricity restructuring plan that includes vertical separation, but plans remain uncertain regarding the horizontal restructuring of generation. Among the more important issues yet to be decided are (a) how hydro capacity will be allocated – it has more than 1/4 of capacity and enjoys low costs – and (b) how many thermal generation enterprises will be created, and with what assets. With more than 1/2 of the thermal capacity accounted for by CHP plants and with a winter demand peak for the foreseeable future, there is a real danger of inflexibility and a lack of competitiveness in a liberalized wholesale electricity market.     

Estimation models for heating energy and electricity costs

Heating energy and electricity represent a significant proportion of the overall financial expenditures over the life cycle of buildings and play a decisive role in the assessment of ecological quality. To ensure ecological and economical sustainability, the planning and construction of energy efficient buildings have become increasingly important. The present study introduces statistical models for the estimation of energy costs during the planning process as well as for the purpose of monitoring and controlling costs during operation including a wide range of facility types. Based on a data sample of 206 occupied facilities located in Germany, regression models are presented in detail including significant predictor variables. The provision of correctly specified models as well as a consistent and unbiased estimation beyond the employed data is verified by validation tests. The practical significance of the determined variables is presented by the calculation of various scenarios. The best estimation accuracy is indicated for regression models with transformed response and predictor variables achieving mean absolute percentage errors of 20.5% (heating energy) and 20.7% (electricity), respectively. An extension of the data sample, a consideration of further facility types, and an implementation of additional statistical methods may be considered by future approaches to improve the estimation accuracy.     

Bicycle use in Germany: explaining differences between municipalities with social network effects

This paper aims to account for important factors influencing bicycle use and focuses in particular on differences between 20 selected German municipalities with considerable variation in their bicycle mode share. Using data from the nation-wide survey Mobility in Germany 2002, a mode choice model for bicycling is developed. In an extension to previous research, social network or spillover effects as a measure of the city’s bicycling culture are also taken into account. These effects are modelled using an instrumental variable approach. It is shown that social network effects increase the probability of cycling for shopping and recreational trip purposes, but not for school, work or errands. Furthermore, it is found that cycling infrastructure matters only for shopping and errand trips. Finally, commuting trips by bicycle seem to be largely independent of any policy variables.     

Public policy towards the sale of state assets in troubled times: Lessons from the Irish experience

The sale of state assets, both tangible (e.g. commercial firms) and intangible (e.g. radio spectrum), can address budgetary shortfalls. However, drawing on the Irish experience to inform this important issue, it becomes clear that much more is involved in selling state assets in electricity, gas, and transport than ranking such assets by value. Wider public policy considerations need to be taken into account in deciding what to sell and under what conditions. The paper outlines how these wider issues, relating to competition and regulation, can be dealt with so that the sale of state assets will enhance societal welfare.     

Are shocks to electricity consumption transitory or permanent? Sub-national evidence from Turkey

This is the first study that aims to investigate policy shocks to energy consumption in terms of unit root properties by sector. More precisely, we analyze the stationarity of electricity consumption for 12 regions of Turkey by four sectors in addition to total electricity consumption by region (for a total of 60 cases). We find that 48 cases are non-stationary and 12 cases are stationary. Thus, policies to decrease or stimulate the use of electricity have permanent effects on electricity consumption in 80% of the cases and transitory effects in the rest. Findings and policy implications are further discussed.