distributed energy infrastructure paradigm community microgrids in a new institutional economics context abstract this paper provides a theoretical framework based on new institutional economics nie concepts to guide the development of community microgrids given limited application thus far of such energy systems this paper also draws on empirical studies and experiences from the planning and development of other public community infrastructure and utility services in the development of this framework it links an efficient ownership and governance structure with transactional characteristics such as asset idiosyncrasy frequency and uncertainty defined in section 3 1 the key role of the customers and the microgrid service provider and more specifically their bilateral monopoly relationship and its effects on the choice of institutional structure is highlighted the paper examines the optimum conditions for public private or hybrid financial ownership and for unified or network governance through long term contracting this allows ex ante investment uncertainty and ex post appropriation risks to be efficiently managed the analysis suggests that long term contract completeness future demand for electricity and level of uncertainty are the determining factors in the selection of institutional structure this has significant real world implications for the communities seeking to achieve electricity self sufficiency and environmental benefits through community microgrids service providers and other private or public actors

the role of decentralized generation and storage technologies in future energy systems planning for a rural agglomeration in switzerland abstract this study presents a framework to quantitatively evaluate decentralized generation and storage technology dgst performance and policy impacts in a rural setting the role of dgsts in the future energy systems planning of a rural agglomeration in switzerland is examined using a cost optimization modeling approach heat and electricity demand for major sectors are considered scenarios introduce dgsts in a stepwise manner to measure incremental impacts on future capacity planning compared to a baseline scenario sub scenarios also examine the impacts of carbon mitigation policies and a sensitivity analysis is carried out for key energy carriers and conversion technologies dgsts enable a significant reduction in electricity grid usage for the community considered small hydro with a storage reservoir and photovoltaics enable the community to become largely self sufficient with over 80 reductions in grid imports by 2050 compared to the baseline scenario storage enables maximum usage of the available hydro potential which also leads to network upgrade deferrals and a significant increase in photovoltaic installations investment decisions in small hydro are robust against cost variations while heating technology investment decisions are sensitive to oil and grid electricity prices carbon pricing policies are found to be effective in mitigating local fossil fuel emissions

awareness of ag gag laws erodes trust in farmers and increases support for animal welfare regulations abstract hidden camera investigations are becoming an increasingly popular means of raising public awareness about farm animal welfare however livestock industries claim they are deceptive one strategy to curtail these investigations has been the introduction of so called ag gag legislation which aims to restrict the flow of information coming out of farm facilities psychological research suggests that this approach may be counter productive as reducing information flow often reduces feelings of trust we sought to extend these findings by applying them to a real world timely example and to determine whether the perceived intention to obstruct access to information erodes feelings of trust accordingly this study tested whether simply being made aware of ag gag laws might have a negative impact on trust in farmers participants n 716 were randomly assigned to either receive information about ag gag laws or to a control condition we found that most people were unaware of ag gag laws and that learning about them lead to a decrease in trust in farmers and an increase in support for animal welfare regulations interestingly we also found evidence that awareness of ag gag laws negatively impacted perceptions of the current status of farm animal welfare as well as the perception that farmers do a good job of protecting the environment through this topical example this study demonstrates that even the intention to restrict access to information can undermine trust

germany s solar cell promotion dark clouds on the horizon abstract this article demonstrates that the large feed in tariffs currently guaranteed for solar electricity in germany constitute a subsidization regime that threatens to reach a level comparable to that of german hard coal production a notoriously outstanding example of misguided political intervention yet as a consequence of the coexistence of the german renewable energy sources act eeg and the eu emissions trading scheme ets the increased use of renewable energy technologies does not imply any additional emission reductions beyond those already achieved by ets alone similarly disappointing is the net employment balance which is likely to be negative if one takes into account the opportunity cost of this form of solar photovoltaic pv support along the lines of the international energy agency iea 2007 energy policies of iea countries germany 2007 review international energy agency oecd paris p 77 we recommend the immediate and drastic reduction of the magnitude of the feed in tariffs granted for solar based electricity ultimately producing electricity on this basis is among the most expensive greenhouse gas abatement options

models for quantifying the economic benefits of distributed generation we examine some of the most important economic benefits brought about by distributed generation technologies to the distribution utility and the power system models are developed that allow the quantification of those benefits in economic terms in some cases industry regulators or utilities charge connection fees to the owners of distributed generators even if they are saving the local utility considerable amounts of money every year in deferred network upgrades reduced losses avoided wholesale market purchases and others efficient economic systems dictate that a proper share of the indirect benefits created by a given economic activity leads to overall optimal independent decision making by its participants quantifying and allocating the benefits of distributed generation to the owners improves the economic performance of their investments and encourages the implementation of those distributed generation applications most valuable to the system

risk perceptions endogenous demand and regulation of agricultural biotechnology abstract this paper presents a dynamic model of optimal product regulation in which consumer acceptance and the rate of product innovation are included as endogenous variables insights derived from the model are used to critically evaluate recent policy controversies regarding regulation of agricultural biotechnology the results of the analysis indicate that if regulatory policy significantly affects consumer risk perceptions more stringent regulatory requirements than those based solely on scientific risk assessment may be economically efficient when demand is endogenously affected by regulatory policies industry may also benefit from stronger regulations even if this results in a significant increase in product development costs

residential energy efficiency and distributed generation natural partners or competition abstract residential energy efficiency and distributed generation seem to be natural partners in our journey towards a more sustainable energy future a growing range of energy efficient consumer technologies and extraordinary declines in photovoltaics system prices has seen household electricity demand fall whilst a growing proportion of the remaining load is provided by household self generation australia is a particularly interesting example of these developments with around 15 of households now possessing a pv system while per capita household demand has also fallen markedly however existing retail electricity tariffs and regulatory arrangements can create mixed incentives for households contemplating both pv and energy efficiency options and for their network service providers this is certainly the case in australia with net metering arrangements that value self consumption of pv far more than pv exports to the grid there are also complex benefits for the electricity network created by these household energy resources that can be significant in this paper we use real household load and pv data from sydney households to model the potential implications of existing electricity tariff arrangements on the financial attractiveness of pv and energy efficiency we model these options separately and in combination for both households implementing these options and their network service providers our results highlight how inappropriate tariffs may well adversely impact on the value that the combination of energy efficiency and pv offers not only to households but also to their network service providers and suggest ways that such impacts might be ameliorated by acknowledging the benefits that these resources can offer to the electricity network

on the quantification of the network capacity deferral value of distributed generation this paper presents an approach to the quantification of the distribution network capacity deferral value of distributed generation dg besides different technical benefits such as reliability and power quality improvement there are a number of economic benefits related to dg the most important of which being the end user electricity bill reduction capability however since the onset of the implementation of these technologies the potential of dg to defer investments on distribution wires and transformers was soon realized to the point that non wire solutions are now considered as an alternative to network upgrades in this work a first approximation to the capacity deferral benefits brought about by dg is obtained such approach can be the starting point towards the development of a framework of credits to the owners of dg that fully and fairly recognize the deferral benefits provided to the utility the financial performance of investments on these important technologies can be then improved thus broadening dg as a viable market alternative for customers and utilities

regulatory practices and distribution system cost impact studies for distributed generation considerations for south african distribution utilities and regulators abstract south africa has introduced renewable energy generation to its grid by means of a competitive bidding process this has been successful as it has quickly introduced renewable generation and has reduced the cost generation significantly over the three rounds of bids submitted the introduction of distributed renewable generation has consequences for the operation and regulation of its distribution networks this paper reviews international practices to establish the cost and benefits of distributed generation to distribution system operators as well as regulatory rules that affect them impact studies for several european distribution system operators are discussed and the main impacts of distributed generation on distribution networks are identified as being voltage rise increased fault levels losses reduced power flows upstream and the deferral of investments regulation of renewable generation in south africa is compared with a range of european countries south africa has implemented a shallowish network charge regime for distributed generators this lowers costs for generators connecting to the network however this has introduced the risk of projects being unable to connect due to deep transmission networks that require funding

climate policy instruments and industry effects and potential responses in the swedish context efficient policy instruments for reducing the emission of greenhouse gases are essential for the realization of a successful climate policy general economic policy instruments have the potential for providing efficient emission reduction as they equalise marginal costs for emission reduction between different actors they also provide incentives for a great variety of responses such as energy efficiency improvements fuel substitution and reduced consumption of carbon intensive products however as a result of the fact that it has so far been impossible to implement policy instruments on a global scale these instruments are often adapted in such a way that some of their potential advantages are eliminated in this paper the possibility of different policy instruments to contribute to reductions in industrial co2 emissions while preserving the competitiveness of industry is evaluated theoretically the consequences of increasing the cost of co2 emission in various industrial sectors are also discussed attention is directed towards carbon taxes emission trading and regulation co2 taxes without tax reductions and emission trading with allocation through auctioning have theoretical advantages in a global climate regime but may lead to significant disadvantages if implemented in a single or a small groups of countries emission trading with free intensity based allocation would in this case have a major advantage in combining incentives for emission reductions through efficiency improvements and fuel substitution with little impact on production levels less

a methodology for understanding the impacts of large scale penetration of micro combined heat and power co generation at small kw e scale has been stimulated in recent years by governments and energy regulators as one way to increasing energy efficiency and reducing co2emissions if a widespread adoption should be realized their effects from a system s point of view are crucial to understand the contributions of this technology based on a methodology that uses long term capacity planning expansion this paper explores some of the implications for an electric power system of having a large number of micro chps results show that fuel cells based micro chps have the best and most consistent performance for different residential demands from the customer and system s perspectives as the penetration increases at important levels gas based technologies particularly combined cycle units are displaced in capacity and production which impacts the operation of the electric system during summer peak hours other results suggest that the tariff design impacts the economic efficiency of the system and the operation of micro chps under a price based strategy finally policies aimed at micro chps should consider the suitability of the technology in size and heat to power ratio to meet individual demands the operational complexities of a large penetration and the adequacy of the economic signals to incentivize an efficient and sustainable operation more highlights capacity displacements and daily operation of an electric power system are explored benefits depend on energy mix prices and micro chp technology and control scheme benefits are observed mostly in winter when micro chp heat and power are fully used micro chps mostly displace installed capacity from natural gas combined cycle units and tariff design impacts economic efficiency of the system and operation of micro chps less

benefits and costs of food safety regulation abstract this paper begins with a review of the concepts and methods that can be used to quantify the benefits and costs of food safety regulations on the cost side where research is only beginning to emerge this paper also provides an analytical framework for measurement of the costs of statutory regulations in the form of design and performance standards this paper also discusses the use and limitations of currently available benefit and cost information for quantitative regulatory impact assessment using the assessment of the mandatory haccp and pathogen reduction regulations in the united states as an example the paper concludes with suggestions for future research on quantifying benefits and costs of food safety regulations

electricity generation from renewables in the united states resource potential current usage technical status challenges strategies policies and future directions abstract in order to secure the energy future and protect the environment the u s is looking for renewable resources to meet the increasing energy demands for its electricity sector which accounts for 40 of total u s energy consumption in 2011 the overall aim of this article is to summarize the possible approaches that can be used to improve and optimize the utilization of renewables for electricity generation in the united states first an overview is presented about the resource potential current usage and technical status of electricity generation from renewables in the united states second a number of economic operational regulatory sustainability and technical challenges that are likely to be encountered are identified third strategies are outlined that can be used to minimize costs deal with the spatial nature of renewables smooth temporal variations associated with intermittency and achieve successful integration of electricity generated from renewable resources into the u s power grid fourth a sustainability assessment framework for renewable resource deployment for electricity generation in the u s is discussed the framework considers multiple criteria including cost environmental and social impacts thus giving a comprehensive assessment of each renewable energy resource for electricity generation in the united states fifth the current u s renewable energy policy is analyzed and rigorous recommendations are made for optimizing future u s renewable energy policy that can permanently induce a long term sustainable shift towards electricity generation from renewables finally directions for future research are highlighted

distributed generation storage demand response and energy efficiency as alternatives to grid capacity enhancement the need for investment in capital intensive electricity networks is on the rise in many countries a major advantage of distributed resources is their potential for deferring investments in distribution network capacity however utilizing the full benefits of these resources requires addressing several technical economic and regulatory challenges a significant barrier pertains to the lack of an efficient market mechanism that enables this concept and also is consistent with business model of distribution companies under an unbundled power sector paradigm this paper proposes a market oriented approach termed as contract for deferral scheme cds the scheme outlines how an economically efficient portfolio of distributed generation storage demand response and energy efficiency can be integrated as network resources to reduce the need for grid capacity and defer demand driven network investments

the theoretical benefits of food safety policies a total economic value framework in this paper we examine consumer benefits from food safety policy the main objective is to develop a model that integrates important insights from the literature on consumers responses to food safety we consider four consumer responses product avoidance brand switching averting behavior and mitigation we suggest how these responses are affected by consumers knowledge of marginal product contamination the effect of averting on marginal product contamination the health effects of total exposure to contaminants and the mitigation expense associated with these health effects

the contingent valuation debate why economists should care t he contingent valuation method involves the use of sample surveys questionnaires to elicit the willingness of respondents to pay for generally hypothetical projects or programs the name of the method refers to the fact that the values revealed by respondents are contingent upon the constructed or simulated market presented in the survey a spirited and occasionally mean spirited battle over such methods is currently being waged involving competing factions within the federal government economists and lawyers representing business and environmental groups and interested academics as well at issue is a seemingly quite specific question should environmental regulations currently under development at both the department of the interior and the department of commerce sanction the use of the contingent valuation method in estimating the damage done by spills of oil chemicals or other substances covered by federal law more generally the debate raises broad questions about what economists have to say about the values that individuals place on public or private goods the two papers that follow this one make cases for and against the use of the contingent valuation method my aim here is to provide an overview of the technique and the debate surrounding it i also want to suggest why this debate should matter to economists both professionally and in their roles as citizens and consumers

design of an economically efficient feed in tariff structure for renewable energy development abstract evidence suggests albeit tentatively that feed in tariffs fits are more effective than alternative support schemes in promoting renewable energy technologies rets fits provide long term financial stability for investors in rets which at the prevailing market price of electricity are not currently cost efficient enough to compete with traditional fossil fuel technologies on the other hand if not properly designed fits can be economically inefficient as is widely regarded to have been the case under the public utility regulatory policies act of 1978 purpa under purpa too high a guaranteed price led to the creation of so called purpa machines poorly performing generating units that could survive financially only because of heavy subsidies that came at the expense of retail customers similarly because of their adverse impacts on retail electricity rates german fits have been subject to increasing political pressure from utilities and customers in this paper we propose an innovative two part fit consisting of both a capacity payment and a market based energy payment which can be used to meet the renewables policy goals of regulators our two part tariff design draws on the strengths of traditional fits relies on market mechanisms is easy to implement and avoids the problems caused by distorting wholesale energy markets through above market energy payments the approach is modeled on forward capacity market designs that have been recently implemented by several regional transmission organizations in the usa to address needs for new generating capacity to ensure system reliability

green certificate markets the risk of over investment and the role of long term contracts abstract several papers have recently analyzed the theory and implementation of renewable energy support schemes the case for a renewable electricity standard res in tandem with a tradeable green certificate tgc market has been largely based on efficiency considerations case study evidence is inconclusive in part due to the short track record but is not generally favorable here we reconsider the efficiency case both static and dynamic in light of special characteristics of renewable energy projects we find that when exclusively high fixed cost technologies comprise the eligible technology pool the equilibrium form of contracting obviates the principal efficiency advantages claimed for certificate markets when low fixed cost technologies compete alongside high fixed cost technologies in the certificate market we show that it is likely that long term contracts will disappear and the technological choice will be inefficiently shifted away from the high fixed cost technology we consider evidence from three well developed certificate schemes in britain sweden and texas and find that it is broadly consistent with the theory here

do economic instruments matter wind turbine investments in the eu 15 abstract this paper analyses how governments in the eu 15 countries have succeeded in stimulating investments in wind turbines between 1985 and 2005 i use four different evaluation criteria tobin s q euler equation estimation investment accelerator model and the effective marginal tax rate to describe the observed investment patterns after a period of rapid growth in capital stock 1985 2000 a period of modest growth 2001 2005 can be observed even though the economic attractiveness of investing increases modestly this pattern cannot be explained by the evaluation criteria unless we accept economic attractiveness is a necessary condition and not a necessary and sufficient condition when analysing which policy has worked best the policies of germany denmark and spain stand out their early and consistent support has been based on feed in tariffs combined with subsidies

no such thing as a free safe lunch the cost of food safety regulation in the meat industry this study develops theoretical and econometric cost function models for the meat industry to test the hypothesis of safety exogeneity i e that product safety does not affect productive efficiency using plant level data from the census of manufactures this hypothesis is rejected estimates of the impacts of food safety regulation on variable cost of production in the beef pork and poultry industries show that the efficiency costs of food safety regulations could plausibly exceed benefits estimated by the u s department of agriculture costs of regulation per pound of meat are found to be size neutral for all but the smallest plants copyright 2000 oxford university press

determinants of retailers decisions to use public or private grades and standards evidence from the fresh produce market of sao paulo brazil abstract this paper models retailers choices between public and private grades and standards g s and their means of administering them it focuses on the firm specific factors influencing the decision increasing use of private g s worldwide particularly by large powerful retail chains has implications for competition participation and the effectiveness and efficiency of public policy regarding g s drawing from a study of fresh produce markets in sao paulo brazil the paper shows that the importance of the product in the firm s activities or sales market power scale of operations and investment in brand capital and reputation are key firm specific factors encouraging the use of private g s regimes over public important contextual determinants are the strategic objective of the standard the institutional environment and the characteristics of the product and market a range of formal and informal private and public methods for administering g s was found the paper discusses policy implications of the results focusing on issues of substitutability and complementarity between public and private g s regimes

variances of security price returns based on high low and closing prices in a recent paper garman and klass 1980 studied the problem of estimating capital asset price volatility parameters developing an idea first introduced by parkinson 1980 they argue that improved volatility measures can be obtained by taking into account the daily high low and opening prices in addition to the traditionally used closing prices this paper is concerned mainly with testing the empirical validity of different volatility estimators based on high low and closing prices

wind power generation an impact analysis of incentive strategies for cleaner energy provision in brazil brazil has adopted various strategies to encourage alternative renewable energy sources in pursuit of cleaner and sustainable energy production to this end strategies should support the reduction of the financial risk for potential investors in the renewable energy market therefore this study aims to analyze the impact of incentive strategies on the financial risk of wind power generation projects in brazil in different marketing environments from a quantitative approach using monte carlo simulation in three scenarios we evaluate the impact of funding from the national development bank and participation in the clean development mechanism in the financial returns of the investor in a regulated contracting environment and free contracting environment measured by the net present value we conduct a statistical analysis to find out if there were statistically significant differences in investor risk in each scenario the main results of the study are as follows the wind speed the selling price of energy and disbursement for the investment have the most significant impact on the financial return the project viability probability is greater than 85 in all scenarios regardless of the marketing environment the regulated market is less risky for the producer than the free market since there is a statistically significant difference in net present value variances for all scenarios in the regulated contracting environment funding is critical to reducing risk and carbon credit trading is not a suitable policy for providing financial security to renewable energy producers thus we conclude that in brazil the contracting of projects from auctions in the regulated contracting environment with the support of the national development bank has been important for neutralizing the producer s financial risks

an analysis of commercial bank common stock returns 1802 97 this study creates analyses for the first time a continous index of returns on commercial bank common stocks listed in a specific market the index is constructed from a unique set of historical data and is calculated on both a weighted and unweighted basis first including and then excluding dividends a measure of volatility is calculated annually the results indicate that the dividend component of holding period returns is very important including dividends average returns were 6 0 for the century excluding dividends average returns were 0 1 excess returns were calculated using two different measures of a riskless rate of return cumulative excess returns for the first half of the nineteenth century were negative real returns were calculated and found to be generally positive over the century the volatility of returns was quite high during certain periods examining the effects of significant economic and political events on bank common stock returns we find that the war of 1812 the civil

long term effects of feed in tariffs and carbon taxes on distribution systems in deregulated electricity sector climates such as in ontario the production of clean or renewable energy by small power producers through distributed generation dg is encouraged this paper examines the policies that can be used to encourage dg investment and incorporates them into a mathematical model this model is then used to create scenarios for examining the economic and environmental supply side effects of policies to a distribution system over a ten year period the policies analyzed include a combination of feed in tariffs co2 tax and cap and trade schemes the results are discussed in the context of the ontario market and its standard offer program implemented on a 32 bus radial distribution system

valuing changes in health risks a comparison of alternative measures essential to efficient provision of health safety and the environment is correct valuation of risks to human health in a world of scarcity difficult decisions concerning tradeoffs between health and other desirables are unavoidable in this paper we develop a model of health investment under uncertainty which yields a general expression for values of changes in risks to human health the preference based values of morbidity risks and mortality risks are ex ante dollar equivalents of changes in expected utility associated with risk changes the preference based values are related to two alternative measures costs of illness and preventive expenditures which are thought to be lower bounds on the value of risk reductions we demonstrate that these alternative measures are not even special cases of the more general measure and that the size relationships among the three measures are complex also we derive the relationship between the willingness to pay for risk changes and the consumer surpluses associated with health changes which occur with certainty the next section contains a brief review of the approaches to valuing changes in health