Publications Published in Energy Economics

1. A statistical approach to conservation supply curves. Willemé, Peter.
   Energy Economics: 2003
   Notes
   While conservation supply curves (CSCs) have been used extensively to estimate the potential of energy conservation, it is recognised that the assumptions of single point unit costs, sequential introduction of measures and (sometimes) lack of interaction effects are major drawbacks. In this article an attempt is made to alleviate some of these problems, while retaining a relatively simple model and without requiring prohibitive amounts of additional data. The idea of a range of unit costs of a conservation measure is operationalized with a logistic curve, which shows the fraction of the total conservation potential that can be economically saved at any energy price. Different measures can be introduced at overlapping ranges of unit costs, avoiding the problem of sequential ordering of the measures in traditional CSCs. When the maximum conservation potential of a measure is allowed to decrease linearly with the introduction of other measures, the model can be extended to allow for negative interaction effects between measures. The model has been applied to estimate the economically achievable energy saving potential for Flemish residential heating.
   
   
   
2. ENTICE-BR: The effects of backstop technology R&D on climate policy models . Popp, David.
   Energy Economics: 2006
   Notes
   Recent attempts to endogenize technology in climate policy models have produced mixed results. Models finding large gains from induced technological change (ITC) consider alternative energy technologies, but assume learning-by-doing, which ignores the opportunity costs of technological change. Models representing ITC through R&D spending consider opportunity costs, but typically include only a single representative energy technology. I address these shortcomings by including policy-induced energy R&D in a model with a backstop energy technology. While ITC is important, larger welfare gains come from simply adding an alternative technology to the model, as opportunity costs limit the role ITC can play. Moreover, since the backstop technology improves welfare even without climate policy, accurate policy analysis depends on a carefully constructed baseline simulation.
   
   
   
3. Innovation in climate policy models: Implementing lessons from the economics of R&D. Popp, David.
   Energy Economics: 2006
   Notes
   Only recently have economists considered the effect of induced innovation in climate policy models. One reason is that, until recently, empirical evidence of the magnitude of such effects was unavailable. Drawing on my experiences with empirical studies on innovation and from modeling the climate change problem, in this paper, I present key lessons from the empirical literature on innovation and environmental policy, and discuss how much of the variation in results found in the modeling literature can be explained by differences in implementing (or failing to implement) these lessons into climate models. The paper concludes with a discussion of future research needs, focusing on a framework for improving the modeling of technology diffusion in climate change models.
   
   
   
4. Multi-gas scenarios to stabilize radiative forcing . Vuuren, Detlef van ; Weyant, John; Chesnaye, Francisco de la.
   Energy Economics: 2006
   Notes
   Using the results of a recent model comparison study performed by the Energy Modeling Forum, we have shown in this paper that including non-CO[2] gases in mitigation analysis is crucial in the formulation of a cost-effective response. In the absence of climate policies, the emissions of non-CO[2] greenhouse increase from 2.7 GtC-eq/year in 2000 to 5.1 GtC-eq/year in 2100 (averaged across all the models). A multi-gas reduction strategy stabilizing radiative forcing at 4.5 W/m[2] (compared to pre-industrial) reduces the emissions (on average) to 2.5 GtC-eq. Such an approach leads to a cost reduction of 30-40% compared to a CO[2] only reduction strategy for the same target. The choices of a target and how the gases are valued form an essential part of developing multi-gas strategies. Model results show that using IPCC global warming potentials (GWPs) as basis for substitution has large consequences for the timing of methane reductions. In this context, further research and assessment on multi-gas metrics, going beyond the mere physical aspects, are important for both research and policy-making.
   
   
   
5. On the importance of the supply side in demand-side management. Fischer, Carolyn.
   Energy Economics: 2005
   Notes
   We discuss how the structure of market supply affects the evaluation of policies to promote energy efficiency in household appliances. If competitive markets offer the levels that consumers demand, product standards inefficiently restrict choice. If suppliers price discriminate, minimum standards can restrict the inefficient use of energy intensity to segment consumers. We also compare the effects of average intensity standards, energy prices and innovation, and consider what the different behavioral predictions imply for empirical studies of energy efficiency. Good policymaking requires knowing not only how consumers value energy efficiency in their decision-making, but also how producers respond to those values. D 2004 Elsevier B.V. All rights reserved.
   
   
   
6. On the sources of technological change: Assessing the evidence. Clarke, Leon; Weyant, John; Birky, Alicia.
   Energy Economics: 2006
   Notes
   This paper uses a selective review of the economic literature on technological change to support four points that are important for interpreting and incorporating technological change into formal models of energy and the environment. The review (1) supports the notion that no single source dominates the process of technological change. It supports roles for R&D and learning-by-doing within an industry, as well as for spillovers from other industries engaged in both of these activities. The literature also (2) supports a strong role for spillovers; (3) indicates that these spillovers are often indirect, requiring own-industry activities to utilize; and (4) indicates that simple experience curve calibrations often used in formal models likely include a range of sources of technological change in addition to learning-by-doing, some of which might not be induced by the sorts of policies typically considered in the climate context.
   
   
   
7. Representing induced technological change in models for climate policy analysis. Sue Wing, Ian.
   Energy Economics: 2006
   Notes
   Induced technological change (ITC), whereby the relative price effects of reducing greenhouse gas emissions stimulate innovation that mitigates the cost of abatement, is both tantalizing to decision makers and challenging to represent in the computational economic and engineering models used to analyze climate change policy. This overview reconciles the divergent views of technology and technological change within different types of models, elucidates the theoretical underpinnings of ITC, introduces the reader to the techniques of their practical implementation, and evaluates the implications for models' results.