Bioethanol development in China and the potential impacts on its agricultural economy

China is now the third largest bioethanol producer in the world after the United State and Brazil. The overall goals of this paper are to provide an overview of China’s current bioethanol program, its future trend, and the likely impacts on its agricultural economy in the future. The analysis shows that China has developed an ambitious long-run biofuel program with a series of financial and institutional supports. While there are several potential feedstock crops available for bioethanol production, lack of land for feedstock production is one of major constraints in China’s bioethanol expansion. The results show that although China’s bioethanol expansion will have little impacts on overall agricultural prices in international markets, it will have significant impacts on the prices, productions, and trade of those energy crops being used for bioethanol production in China.     

The Impacts of Carbon Sequestration on Oil Production Projects Decision-Making： A Real Option Valuation Approach

A traditional real option model is applied to a simulation of an oil production project. This analysis includes a carbon sequestration structure cost and possible revenues from carbon credit markets. The evaluation focuses on the determination of an optimal timing for the investment in different scenarios, regarding the volatility of the uncertain variable, oil prices. Historical prices data from different moments are used to estimate different prices uncertainty scenarios and its impacts on the decision making on building a carbon sequestration structure. The results are compared between a real option model to the ones obtained using the traditional net present value evaluation. Trigger point of investments are defined for different scenarios with and without carbon sequestration. There is also an analysis of the effects on decision-making in different scenarios for carbon market prices. It is perceived an important difference in the decision making considering the different methods of economic analysis. The real option model is a fundamental valuation tool in periods of high price volatility and higher sunk costs added to a project such as the carbon sequestration structure. Greenhouse gas projects demand high oil prices, positive market trend expectation and volatility.     

Risk management in the oil industry: can information on long-run equilibrium prices be utilized?

We analyze co-movements between the prices of crude oil and major refined products during the period 1992–1998. Specifically, we explore the existence of long-run equilibrium price relationships, and whether deviations from estimated equilibrium can be utilized for predictions of short-term price changes and for risk management. The econometric evidence strongly supports the hypothesis that crude and product prices are co-integrated. Past deviations from long-term equilibrium are significant in an error correction specification of short-term product price changes. The results represent valuable information for hedging, particularly in integrated oil companies for which price risk is related to margin variations.     

Effects of stochastic energy prices on long-term energy-economic scenarios

In view of the currently observed energy prices, recent price scenarios, which have been very moderate until 2004, also tend to favor high future energy prices. Having a large impact on energy-economic scenarios, we incorporate uncertain energy prices into an energy systems model by including a stochastic risk function. Energy systems models are frequently used to aid scenario analysis in energy-related studies. The impact of uncertain energy prices on the supply structures and the interaction with measures in the demand sectors is the focus of the present paper.

For the illustration of the methodological approach, scenarios for four EU countries are presented. Including the stochastic risk function, elements of high energy price scenarios can be found in scenarios with a moderate future development of energy prices. In contrast to scenarios with stochastic investment costs for a limited number of technologies, the inclusion of stochastic energy prices directly affects all parts of the energy system. Robust elements of hedging strategies include increasing utilization of domestic energy carriers, the use of CHP and district heat and the application of additional energy-saving measures in the end-use sectors. Region-specific technology portfolios, i.e., different hedging options, can cause growing energy exchange between the regions in comparison with the deterministic case.     

The large-scale integration of wind generation: Impacts on price,reliability and dispatchable conventional suppliers

This work examines the effects of large-scale integration of wind powered electricity generation in a deregulated energy-only market on loads (in terms of electricity prices and supply reliability) and dispatchable conventional power suppliers. Hourly models of wind generation time series, load and resultant residual demand are created. From these a non-chronological residual demand duration curve is developed that is combined with a probabilistic model of dispatchable conventional generator availability, a model of an energy-only market with a price cap, and a model of generator costs and dispatch behavior. A number of simulations are performed to evaluate the effect on electricity prices, overall reliability of supply, the ability of a dominant supplier acting strategically to profitably withhold supplies, and the fixed cost recovery of dispatchable conventional power suppliers at different levels of wind generation penetration. Medium and long term responses of the market and/or regulator in the long term are discussed.     

基于煤耗特性的火电厂动态成本模型研究

在"厂网分开,竞价上网"的电力体制下,电能成本的分析对发电企业的生产运营已显得尤为重要。重点研究在"煤电联动"机制还没有完全实现、机组负荷不稳定的条件下,电能成本如何变化。在分析了电能成本构成的基础上,运用定性、定量相结合的方法给出了机组成本、利润函数模型,并以实际数据分析了机组负荷率、煤耗率及燃煤价格对成本利润的影响。最后以某300MW电厂为例,给出了机组实时成本利润曲线。对火电企业的运营有一定指导意义。     

The effect of residential solar photovoltaic systems on home value: A case study of Hawai‘i

An investment in solar photovoltaic (PV) is considered a home improvement, and should be reflected in home sales prices. However, uncertainty about PV policies and information asymmetries may result in an imperfect pass-through. Hawai‘i serves as an illustrative case study to assess the impact of PV on home prices because Hawai‘i has the highest number of PV installations per capita nationwide. Applying a hedonic pricing model using home resale and PV building permit data from 2000 to 2013 for Oʻahu, I find that the presence of PV adds on average 5.4% to the value of a home. The value of PV exceeds total average installed costs because many of Hawai‘i's electricity circuits have reached legal limits for PV installations and thus many neighborhoods could technically no longer install additional PV capacity. Therefore, the value of the system goes beyond its capital investment—on average, by $5000—to incorporate expected electricity savings.     

Optimal operation of autonomous microgrid including wind turbines

This paper gives a novel hybrid optimization method to find optimal sitting and operation of an autonomous MG at the same time. The operation is optimized via finding the optimal droop gain parameters of DGs. The optimization problem is formulated as a multi-objective problem where the objectives are applied to minimize the fuel consumption of DGs and to improve the voltage profile and stability of MG subject to operational and security constraints. A hybrid algorithm, named HS-GA, is developed to solve the paper optimization problem. A new formulation of power flow is derived to run the proposed algorithm where the steady state frequency of system, reference frequency, reference voltage and droop coefficients of DGs, based on a droop controller, are considered as optimization variables. The performance of the paper approach is compared with other optimization and non-optimization methods in MG with 33and 69 buses using MATLAB. The performance of the proposed method is compared with a method that the parameters of DGs are pre-determined without conducting any optimization process. The results show, which optimized droop parameters improves the operation of the MG.     

The crucial relationship among energy commodity prices: Evidence from the Spanish electricity market

The main purpose of this article is twofold to analyze: (a) the long-term relation among the commodities prices and between spot electricity market price and commodity prices, and (b) the short-term dynamics among commodity prices and between electricity prices and commodity prices. Data between 2002 and 2005 from the Spanish electricity market was used. Econometric methods were used in the analysis of the commodity spot price, namely the vector autoregression model, the vector error correction model and the granger causality test. The co-integration approach was used to analyze the long-term relationship between the common stochastic trends of four fossil fuel prices. One of the findings in the long-term relation is that the prices of fuel and the prices of Brent are intertwined, though the prices of Brent ten to “move” to reestablish the price equilibrium. Another finding is that the price of electricity is explained by the evolution of the natural gas series.     

Trends in prices to commercial energy consumers in the competitive Texas electricity market

To date, the price of electricity to commercial or business energy consumers has generally increased at greater rates in the areas of Texas where retail competition has been introduced than in areas that do not enjoy competition. Trends in commercial competitive prices have largely mirrored trends in residential prices. Market restructuring has tended to increase the sensitivity of retail electricity prices to changes in the price of natural gas, the marginal fuel used for generation in Texas. Consequently, the rapid increases in the commodity price of natural gas following restructuring led to increases in competitive electric rates which exceeded the increases in areas not exposed to restructuring, where the fuel component of electric rates tend to reflect a weighted average of the utilities’ fuel costs. There is some evidence that pricing behavior by competitive retailers changed when the retailers affiliated with the incumbent utilities were permitted some pricing flexibility, resulting in a reduction in prices.