productivity in swedish electricity retail distribution this paper examines productivity growth in electricity retail distribution in sweden in a multiple output multiple input framework the approach used is nonparametric data envelopment analysis dea productivity is measured by means of the malmquist index productivity comparisons are made between different types of ownership and between different service areas the study indicates a high rate of productivity growth due to economies of density when measured over a period of 17 years the results show no significant differences in productivity growth between different types of ownership or economic organization

cross hedging and forward contract pricing of electricity we consider the problem of an electric power marketer offering a fixed price forward contract to provide electricity that it purchases from a potentially volatile and unpredictable fledgling spot energy market one option for the risk averse marketer who wants to hedge against the spot price volatility is to engage in cross hedging to reduce the contract s profit variance and to determine the forward contract price as a risk adjusted price the sum of a baseline price and a risk premium we show how the marketer can estimate the spot price relationship between two wholesale energy markets for the purpose of cross hedging as well as the optimal hedge and the forward contract s baseline price and risk premium

collateral in credit rationing in markets with imperfect information note in their 1981 article joseph stiglitz and andrew weiss analyze adverse selection and incentive effects in the loan market the models considered are based on two crucial assumptions borrowers are subject to limited liability and lenders cannot distinguish borrowers projects of different risk stiglitz and weiss show that a bank that raises its interest rate may suffer adverse selection because only risky borrowers will be willing to borrow at the higher rate thus lenders may choose not to raise the interest rate to eliminate excess demand resulting in the possibility of a credit rationing equilibrium stiglitz and weiss also consider briefly the role of collateral in such credit rationing models they conclude that lenders may choose not to use collateral requirements as a rationing device an increase in collateral requirements like an increase in the interest rate potentially leads to a decrease in the lender s expected return on loans because of resulting adverse incentive and selection effects the purpose of this note is to further investigate the role of collateral in these models stiglitz and weiss discussion in section iii establishes that adverse selection effects can result from increases in collateral when borrowers are risk averse i will show by returning to a model they discussed earlier in section i that the adverse selection effects can also occur when borrowers are risk neutral stiglitz and weiss outline a model to consider the use of collateral as a rationing device section iii in that model all potential borrowers face the same array of risky projects each potential borrower chooses at most one of those projects to undertake the individuals are by assumption risk averse with decreasing absolute risk aversion and possess different amounts of initial wealth thus choice of project if any to undertake and the method of finance selffinance from initial wealth or loan finance will differ from one individual to the next stiglitz and weiss show that among those who undertake risky projects and who choose borrowing as the method of finance wealthier individuals undertake riskier projects an increase in collateral has two effects on the market for loans those individuals who remain in the market will choose to undertake less risky projects and those individuals who drop out of the market are less wealthy low risk borrowers if the second effect is sufficiently strong then increased collateral requirements will mean decreased expected returns for the lender thus a credit rationing equilibrium may occur since lenders may not choose to use collateral requirements or the interest rate to eliminate excess demand the adverse selection effect just described does not occur in this model if the individuals are risk neutral consequently the potential for a credit rationing equilibrium is limited to cases where borrowers are risk averse to see that increases in collateral requirements can also result in adverse selection if borrowers are risk neutral consider the model stiglitz and weiss used to analyze the adverse selection effects of increases in the interest rate section i pp 395 99 it differs from the section iii model discussed above in three ways first borrowers are risk neutral second all projects ar loan financed the analogy to the section iii model is that no individuals have sufficient wealth to self finance projects third in the section

adoption of digital repositories for co2 emissions reduction the case of korea abstractthis study aims to estimate the potential economic benefits energy and co2 emissions reductions when using trusted third party digital repository ttpr services in one individual bank and within the banking industry in korea first the cost benefit and net benefit of using ttpr services in the banking industry are estimated second the net induced output effect is estimated third based on an environmentally extended input output analysis co2 emissions reduction was estimated as 1924 32 tons in 2009 and the energy consumption reduction as 640 70 toe fourth the total economic benefit which is the sum of the net induced output effect and economic value of co2 emissions reductions is approximately 11 04 million the findings demonstrate that energy consumption and co2 emissions reductions are meaningful enough to result in significant economic benefits therefore the korean government should promote the use of ttpr services in the entire industry

co2 emissions from china s power sector at the provincial level consumption versus production perspectives abstract the chinese electricity sector plays an important role in domestic co2 mitigation efforts due to its large contribution to overall emissions however primary energy resources used for electricity generation are not evenly distributed across the country such a supply and demand mismatch in reality results in large parts of electricity to be transferred from economically less developed provinces in the west to economic growth centres in the east a literature review shows that the emissions embodied in electricity transfer within china have not been explicitly studied although in fact they cause a shift of environmental pollution away from economically well off provinces to resource rich and less developed provinces therefore it is critical for policy makers to address this issue under such a circumstance a bottom up model is developed to calculate direct co2 emissions embodied in electricity export and import between chinese provinces it helps quantifying emissions from the power sector associated with both production and consumption perspectives and sheds lights on the environmental impact of regional supply and demand mismatch in china results show that the difference between consumption and production based co2 emissions from electricity sector in some provinces were higher than the total co2 emissions from electricity sector in netherlands in the case of beijing or as high as the total co2 emission from france s electricity sector in the case of guangdong based upon chinese realities policy implications and suggestions are made such as how to set up appropriate emission reduction targets for electricity sector at provincial level and the inclusion of consumption emissions in designing china s cap and trade mechanism the methodology and findings may be useful for investigation of embodied emissions throughout various regions of the world

a multi dimensional analysis on microeconomic factors of china s industrial energy intensity 2000 2017 abstract reducing energy intensity is the key point to solve the contradiction among economic development energy constraints and environmental pressure in china considering microeconomic factors this paper extends decomposition and attribution models and analyses the drivers of china s industrial aggregate energy intensity aei at the regional sectoral level the results show that aei decreased by 49 during 2000 2017 at the regional level most provinces presented negative contribution on regional energy intensity effect the aei decline was attributed to the drop of greatest negative effect of r d efficiency in liaoning the increase in investment intensity and r d intensity lead to an increase in aei largely owning to shandong and liaoning respectively at the sectoral level the aei decline can be mainly explained by the inhibition effect of energy intensity and r d efficiency however this negative contribution was greatly offset by the r d intensity effect the investment intensity showed a positive impact in aei increase and smelting and pressing of ferrous metals sector was the main contributor regional and sectoral investment structure effect shifted from increasing to decreasing aei over the study period based on the results targeted policy recommendations are proposed to further decrease the china s industrial aei in the 14th fyp period

a feasible reform for the electricity supply industry in hong kong with the current scheme of control regulation for the hong kong electricity supply industry expiring in 2008 the government has sent out a consultation paper seeking views from the general public on its reform and possible future development this paper investigates the characteristics of the current agreement and the rationale for feasible reform of the hong kong esi it leads to a discussion on a proposed feasible reform using performance based regulation approach modeling and the associated implementation issues related to price capping risk analysis performance indices quality monitoring and governance

integration of price cap and yardstick competition schemes in electrical distribution regulation discussion and closure several authors make separate comments on the paper by h rudnick et al see ibid vol 15 no 4 p 1428 33 2000 and ask for further clasirifaction and comments on the issues they raise the original authors reply to the comments

the role of collateral in credit markets with imperfect information abstract the paper analyzes the structure of credit market equilibrium under imperfect information collateralization and credit rationing are compared as alternative means to cope with problems of adverse selection and moral hazard it is shown that lenders may use collateral as a self selection and incentive mechanism rationing occurs only if the borrowers collaterizable wealth is too small to allow perfect sorting or to create sufficiently strong incentives whenever there is rationing in an equilibrium some borrowers are charged the maximum amount of collateral

the british model in britain failing slowly in 1990 britain reorganised its electricity industry to run on competitive lines the british reforms are widely regarded as successful and the model used provides the basis for reforms of electricity industries worldwide the main reason for this perception of success is major reductions in the real price of electricity with no reduction in service quality this paper examines whether the reputation of the british reforms is justified it concludes that the reputation is not justified and that serious fundamental problems are beginning to emerge the central question is have the british reforms resulted in the creation of efficient wholesale and retail markets on this criterion the reforms have failed the wholesale market is dominated by obscure long term contracts privileged access to the market and self dealing within integrated generator retailers leaving the spot markets with minimal liquidity and unreliable prices the failure to develop an efficient wholesale market places the onus on consumers to impose competitive forces on electricity companies by switching regularly small consumers will not do this and they are paying too much for their power for the future there is a serious risk that the electricity industry will become a weakly regulated oligopoly with a veneer of competition

competitive equilibrium in the credit market under asymmetric information abstract we study a competitive credit market equilibrium in which all agents are risk neutral and lenders a priori unaware of borrowers default probabilities admissible credit contracts are characterized by the credit granting probability the loan quantity the loan interest rate and the collateral required the principal result is that in equilibrium lower risk borrowers pay higher interest rates than higher risk borrowers moreover the lower risk borrowers get more credit in equilibrium than they would with full information no credit is rationed and collateral requirements are higher for the lower risk borrowers

merging electricity and environment politics of hong kong identifying the barriers from the ways that sustainability is defined abstract the present paper presents a study of the electricity policy of hong kong in an environmental political context through a critical review of the policy structure and rationale it identifies the barriers to developing a truly sustainable electricity policy system and is expected to shed light on the forthcoming electricity market reform in the territory the barriers stem from the path dependent institutional set ups that restrict a timely transformation of the roles of the actors and this is coupled with the government s treatment that does not look beyond these structural constraints overly appreciating scientific and economic rationalities than communicative actions the author is of the view that these are intensified by the sharp changes in the local political economy positive signs of change are dampened by the minimal progress in democratic development in the near future and the extension of the power companies monopolist status that will ruin the trust between the stakeholders compounding the guilt of those rigid regulatory constraints

on the electrical two part tariff the brazilian perspective this paper discusses in terms of brazil s situation the use of a nonlinear pricing approach in the application of a two part tariff to electricity distribution networks the principles that uphold charging access and usage are to optimize energy systems that are based on a generation technology mix such a pricing approach is used in brazil where the generation mix is mainly hydro generation this study shows that in a case like brazil s a two part tariff may be used as a tool for network optimization the paper presents a design for a two part tariff for a distribution system with varying consumer behavior to validate the discussion we offer a numerical example finally remarks are given concerning pricing access and usage for low voltage level consumers

the reform of the natural gas industry in the pr of china abstract in light of china s energy revolution reform of the natural gas industry and the acceleration of the natural gas sector development are of strategic significance to ensure china s energy security to optimise the energy consumption structure and to address environmental pollution in recent years the chinese government has introduced numerous policies and developmental plans to speed up natural gas sector reform which have led to considerable progress however china s natural gas industry and reform still encounter many problems and challenges the purpose of this study is to investigate the reform of the natural gas industry in china first the current situation of china s natural gas industry is outlined next four aspects of natural gas industry reform are systematically reviewed natural gas administrative system reform industry structure reform pricing mechanism reform and tax and fee system reform third the major problems and challenges facing further reform of the natural gas industry are analysed in depth finally this study proposes policies and suggestions for china s natural gas sector in the coming future

energy consumption and gdp causality relationship in g 7 countries and emerging markets abstract the causality relationship between energy consumption and income is a well studied topic in energy economics this paper studies the time series properties of energy consumption and gdp and reexamines the causality relationship between the two series in the top 10 emerging markets excluding china due to lack of data and g 7 countries we discover bi directional causality in argentina causality running from gdp to energy consumption in italy and korea and from energy consumption to gdp in turkey france germany and japan hence energy conservation may harm economic growth in the last four countries

the national and international impacts of coal to gas switching in the chinese power sector abstract we evaluate the national and international impacts on energy consumption and production trade and economic activity of chinese coal to gas switching in the electric power sector we find that assumptions about growth rates in electricity generation from renewables are the key determinant in evaluating the economic consequences for coal to gas switching in china the ability to supplement natural gas generation with renewables leads to smaller reductions in chinese and global economic activity than the alternatives

technical efficiency of french nuclear energy plants this article analyses the efficiency of french nuclear energy plants belonging to edf electricity of france from 2004 to 2008 with a dea data envelopment analysis model the convexity model is used to investigate the technical efficiency of a representative sample of nuclear plants the results indicated that some plants have undergone an improvement in technical efficiency while others have regressed in terms of technical efficiency policy implications related to the results are discussed

the reform of electricity power sector in the pr of china deregulation was launched as a concept in the united states more than a decade ago the european union commission has also formally announced that electric deregulation must be completed by the end of 2005 deregulation or reform has already been a popular topic on the electricity power sector this paper will discuss the restructuring and regulatory reforms in the pr china s power sector it begins with a discussion of the characteristics of electricity reform or deregulation in other countries including the us the united kingdom and so on it will be followed by the industry structure and regulatory framework that characterized china s power industry during the latter part of the 20th century and the history of china s reform to restructure the power industry to competitive suppliers of generating services in recent years it discusses the role of the state power corporation in the reform and gives a detailed description of the latest electricity reform in the year 2002 the paper concludes with some thoughts regarding future challenges and trends on the reform for china s power sector

the impact of china s electricity price deregulation on coal and power industries two stage game modeling abstract the regulated price mechanism in china s power industry has attracted much criticism because of its incapability to optimize the allocation of resources to build an open orderly competitive and complete power market system the chinese government launched an unprecedented marketization reform in 2015 to deregulate the electricity price this paper examines the impact of electricity price deregulation at the industry level we first construct two stage dynamic game models to portrait the interaction between the coal and coal fired power industries using the models we compare analytically the equilibriums with and without electricity price regulation concerning electricity price electricity generation coal price and coal production the theoretical analyses find three regulated electricity price intervals that differentiate the reform impacts afterward we collect empirical data to estimate the model parameters the influences on the two industries in terms of market outcome and industrial profitability are simulated our results suggest that the current regulated electricity price falls within the medium interval which means deregulation will result in higher electricity price but lower coal price less coal production and less electricity generation the robustness analyses show that our results hold with respect to the electricity generation efficiency and price sensitivity of electricity demand

the higher cost of follow up loans this paper uses unique data and looks at the interest margin for follow up finance vis a vis first round finance applying data for asset values we examine the substitution between collateral and interest margins consistent with the theories of bester 1985 besanko and thakor 1987 and the empirical evidence of cressy 1996b we find that a trade off between collateral and interest margins exists our main result indicates that follow up finance is more expensive for loans but not for overdrafts we suggest that a relatively fixed asset base land and buildings as seen in higher security to loan values raises the price and risk of successive financial increments this explains the higher relative cost of follow up finance to borrowers

distribution pricing based on yardstick regulation summary form only given as follows transmission and distribution t d pricing has been one of the keystones of the ongoing deregulation and privatization process in the power industry the electricity market has been established based on the assumption of open access and nondiscriminatory use of the t d assets as t d business remains as a monopoly it is necessary to provide economic regulation many papers have dealt with transmission pricing and certain maturity has been reached in this area but this is not true in the case of distribution services this paper focuses on the distribution pricing methods and suggests one that is currently under development in brazil this method is based on incremental costs derived from the aggregated expansion plan of a particular utility named model utility this utility was obtained by comparisons among the real distribution companies the method follows the fundamentals of the yardstick regulation

integration of price cap and yardstick competition schemes in electrical distribution regulation the disadvantages of traditional rate of return regulation for distribution tariffs have led to he development of new regulatory schemes to stimulate efficiency in the provision of the service under what has been called benchmark regulation the paper assesses the chilean model company regulation that aims at making the private distribution monopoly compete with a reference efficient model company through a yardstick competition approach it compares it with the price cap scheme used in electricity distribution in england and wales it contributes with a proposal to integrate both schemes the proposed hybrid methodology is developed and evaluated capturing the best characteristics of both regulatory schemes mathematical models to relate operational costs with electrical variables are developed

an analysis on the short term sectoral competitiveness impact of carbon tax in china abstract market based instruments particularly carbon tax have recently drawn the attention of chinese government by their cost effective contribution to the achievement of china s climate targets most of the recent policy proposals have focused on its long term impact however particularly for policy makers both long term and short term effects of carbon tax would be necessary when determining tax rates we provided a detailed analysis of short term impacts of carbon tax on sectoral competitiveness in this paper we divided china s economy into 36 sectors based on its 2007 input output table in order to examine the ratio of carbon tax added costs to sector gdp we were thus able to determine the impact level of a carbon tax on each sector we then divided the sectoral trade impact into domestic competitiveness with regards to foreign imported products and international competitiveness external to the chinese domestic market we found that a high tax level 100 yuan t co2 may necessitate compensatory measures to certain highly affected industries and that a low tax rate 10 yuan t co2 would generate few competitiveness problems for all industries and may therefore be considered as an appropriate starting point

cost benefit analysis of reforming israel s electricity industry abstract in june 2003 the israeli government decided to reform the israeli electricity industry which is currently dominated by israel electric corporation iec a government owned vertically integrated electric utility the first step of the planned reform will be taken in 2006 when iec will be functionally separated into generation transmission local distribution and customer services immediately thereafter will be the second step which by 2012 will result in the deregulation and privatization of the wholesale generation and customer services transmission and distribution t and d services will remain regulated but will be available to all t and d users under mandatory open access this paper summarizes a cost benefit analysis of the government s reform plan relative to a regulated regime the government s plan even if carried out flawlessly may only yield a small net benefit however it entails a large increase in electricity producer profit and government tax receipt at the expense of electricity consumers a less than perfect transition to competition can easily wipe out the potential gain of the government plan market reform experience to date shows that electricity market reform can easily fail and the factors for success do not exist in israel since the outcome of a failing reform can be disastrous it will be imprudent to implement the government s plan in 2006 when the current electricity law expires hence we recommend performance based regulation for the period of 2006 2010 subject to an updated cost benefit analysis possible decentralization privatization and competition may follow

a literature study for dea applied to energy and environment abstract this study systematically summarizes previous research efforts on data envelopment analysis dea applied to energy and environment in the past four decades including concepts and methodologies on dea environmental assessment industrial developments are very important for all nations in terms of their economic prosperities a problem is that the development produces various pollutions on air water and other types of contaminations all of which are usually associated with our health problems and climate changes thus it is necessary for us to consider how to make a balance between economic success and pollution mitigation to maintain a high level of social sustainability in the world it is widely considered that dea is one of the methodologies to examine the level of sustainability this study examines a recent research trend on dea applications from 1980s to 2010s nowadays many researchers have paid serious attention on how to combat various difficulties in the areas of energy and environment as a result the number of articles on dea applications on energy and environment has dramatically increased particularly after 2000s however it is true that dea has strengths and drawbacks in the applications therefore it is very important for us to carefully use dea for guiding large policy issues and business strategies such as the global warming and climate change an underlying premise of this study is that technology innovation in engineering and natural science may solve various problems by linking it with political and managerial efforts the use of dea provides a methodological linkage among them so enhancing the practicality in mitigating problems due to climate change and environmental pollutions this literature study along with a summary on conceptual and methodological developments provides us with guidelines for our future research works on dea on energy and environment issues

repossession and the democratization of credit we exploit a 2004 credit reform in brazil that simplified the sale of repossessed cars used as collateral for auto loans we show that the reform expanded credit to riskier self employed borrowers who purchased newer more expensive cars the legal change has led to larger loans with lower spreads and longer maturities although the credit reform improved riskier borrowers access to credit it also led to increased incidences of delinquency and default our results shed light on the consequences of a credit reform and highlight the crucial role that collateral and repossession play in the liberalization and democratization of credit

discussion of performance evaluation of electric distribution utilities based on data envelopment analysis the authors comment on the paper by a pahwa et al see ibid vol 18 p 400 5 2003 and ask questions related to the dual formulation of the data envelopment methodology selection of the variables and the usefulness of the efficiency studies

distribution access pricing application of the oftel rule to a yardstick competition scheme the paper formulates an access pricing model applied to electricity distribution based on the uk office of telecommunications oftel model originally structured to price telecommunications monopolistic essential facilities the aim is to achieve an optimal access price charge in an environment where a distribution network monopoly serves both regulated and nonregulated customers the nonregulated market faces competition so that the competitors must use the network to reach their customers a usage based hybrid model is proposed to couple with a tariff scheme for regulated customers that uses yardstick competition a way to set appropriated opportunity costs by the use of the oftel model is introduced finally the paper focuses on properly recognizing both regulated distribution and competitive supply costs the scheme is assessed within the chilean regulatory scheme proposing a way to establish marginal and fixed distribution costs for distribution companies

causal relationship between energy consumption and gdp revisited the case of korea 1970 1999 abstract causal relationship between energy consumption and economic growth is investigated applying a multivariate model of capital labor energy and gdp usual btu energy aggregate is substituted with a divisia aggregate in an attempt to mitigate aggregation bias to test for granger causality in the presence of cointegration among the variables we employ a vector error correction model rather than a vector autoregressive model empirical results for korea over the period 1970 1999 suggest a long run bidirectional causal relationship between energy and gdp and short run unidirectional causality running from energy to gdp the source of causation in the long run is found to be the error correction terms in both directions

uniform marginal pricing for the remuneration of distribution networks a new method for distribution access via uniform pricing for the remuneration of distribution networks is presented the proposed approach merges in a unified framework the investments the optimal network operation requirements the effect of the price elasticity of demand and the application of hourly pricing for demand side management purposes hourly uniform marginal prices understood as tariffs of use of the network are obtained from maximum social welfare condition sending efficient signals to the utility and consumers related to the optimal operation of the grid and use of the energy at peak and valley hours this method is used in the context of a performance based ratemaking regulation to get model companies from operational optimized real networks capital fees are integrated in the marginal tariff of use by means of the new replacement value concept broadly used in yardstick competition the model is stated as a mixed integer linear optimization problem suitable to be solved through well known linear programming tools the methodology has been successfully tested in a 42 bus test distribution network

secured lending and default risk equilibrium analysis policy implications and empirical results the authors examine collateral in a competitive equilibrium in which borrowers can choose hidden actions and may additionally possess hidden knowledge apart from explaining the widespread use of collateral despite deadweight costs they show that an increase in the riskless interest rate causes equilibrium loan rates and collateral requirements to increase a decline in the deadweight costs of collateral reduces the equilibrium collateral use under moral hazard and an increase in the borrower s project size reduces equilibrium collateral use under moral hazard some of these predictions are tested and found to be supported by the data copyright 1991 by royal economic society

determinants of innovation in energy intensive industry and implications for energy policy abstracts the korean government adopted green growth in 2008 as an environmentally friendly growth strategy the energy efficiency of korea however is still relatively low due to the large portion of energy intensive industry eii in its manufacturing sector to improve energy efficiency in korea from an eii perspective a new approach has to be taken because restructuring entire industries would take too much time and be too costly this study aims to emphasize the importance of innovation and analyze the effects of r d on product and process innovations in eii in korea the probit model is adopted to estimate the effects of eight determinants in the korea innovation survey 2008 data the results of this study demonstrate that one of the most important determinants the r d personnel ratio has a strong positive effect on both product and process innovation while another determinant r d intensity only has a strong and positive effect on process innovation in eii because of the resulting innovation energy policies should be enacted to enhance energy efficiency thus the korean government should keep providing incentives for firms in eii to invest more financial and human resources in their r d activities

reform of china s electric power industry challenges facing the government abstract china s electrical power industry requires substantial reform if the country s economic growth is to be sustained the 1997 electricity law the creation of a state power company and the abolition of the ministry of electric power are important first steps on the path of reform but it seems that a clear plan is lacking objectives of the reform should include increasing the capacity to deliver power constraining the costs of the power industry increasing end user efficiency and minimising environmental damage efforts should be directed at restructuring the industry in such a way that fair competition may be introduced at least in power generation and at establishing a viable regulatory agency both tasks have the potential to be thwarted by a range of vested interests at different levels of government and industry

estimation of residential electricity demand in hong kong under electricity charge subsidies abstract over the past decade the hong kong hk government provided electricity charges subsidies for residential accounts to alleviate the burden of inflation and later the burden of economic downturn in this study we estimate an econometric model of residential electricity demand and test the existence of a stable long run relationship for the period 1980 2016 while accounting for the relief measures set out by the hk government since 2008 empirical results suggest that there exists a long run relationship among residential electricity consumption electricity price income per capita and weather variables temperature or cooling degree days in the absence of electricity charge subsidies the demand is found to be both price and income inelastic on the other hand hk s residential electricity consumers are unresponsive to price and income changes when electricity subsidies are in place following its new carbon reduction plan hk is gradually phasing out coal for electricity generation to replace it mainly with natural gas our results suggest that new residential electricity charge subsidies can lessen the effectiveness of6 climate policies aimed at reducing electricity consumption through increases in the electricity price

a cluster analysis study based on profitability and financial indicators in the italian gas retail market in the european union the natural gas market is increasingly being liberalized the liberalization process is aimed at leading to lower prices and higher volumes and hence higher consumer welfare this paper focuses on the changes in performance in the natural gas retail market by analyzing the profit and financial position of the companies concerned over the first three years following the market liberalization the balance sheets of 105 italian companies in this sector are analyzed after which a cluster analysis is performed employing the most significant performance indexes the companies are then analyzed within each cluster with respect to age size geographical location and business diversification the results of our analysis show that the majority of companies attained a high level of performance although this positive outcome was mitigated by the gradual decrease of the average values of performance indicators during the period concerned the companies that achieve the best performances belong to longstanding business groups are medium large sized and are located in the north of the country regarding business diversification in the first two years the specialised companies outperformed the diversified companies

decompositions of fisher indexes abstract a fisher price or quantity index has no natural additive or multiplicative decomposition in view of the growing use of fisher indexes in official statistics however there is need for such decompositions this paper summarizes and compares the various proposals

electricity regulation and electricity market reforms in china the electricity industry of china has been in a process of reforms since the 1980s this paper gives a review on the three main stages of reforms in china so as to trace out key features of various reform measures including those for power investment financing the separation between government and power enterprises and the division between power generation firms and power grids the findings suggest that further regulatory change in china s electricity market reform is necessary when integration of the electricity markets and increased competition are paving the way ahead for a market oriented structure prospective electricity regulation in the form of a strong legal system and effective institutions that protect market competition and promote appropriate incentives for efficiency are suggested in the paper

asymmetric valuations and the role of collateral in loan agreements loan contracts with provision for collateral are of two general types in one the collateral may be an existing asset of the borrowing firm which is pledged to a lender in the event of default in this case collateral does not increase the assets that the borrower would lose if there is default since all the borrower s assets are attachable therefore the expected marginal cost to the borrower of providing an additional unit of collateral includes principally transactions costs associated with the collateral l this describes the usual type of commercial loan arrangement with the collateral being either equipment real estate accounts receivable or inventories in the other type of loan contract the collateral is an additional asset that is given up by the borrower if there is default that is in addition to the usual assets that are available to its lenders the borrower assigns as collateral to a creditor an asset that would normally not be legally attachable this arrangement is more common in small business loans that are secured by a personal asset e g a house of the entrepreneur likewise debt issued by a legally separate subsidiary may be secured by an asset of the parent firrn in these cases the expected marginal cost to the borrower the owner manager of the small firm or the parent corporation in the latter example of providing an additional unit of collateral

a dynamic model for firm response to non credible incentive regulation regimes economic network regulation increasingly use quantitative performance models from econometrics and engineering to set revenues in theory high powered incentive regulation such as revenue caps induces firms to cost efficient behavior independent of underlying model however anecdotal evidence shows regulated firms occasionally maintaining cost inefficiency under incentive regulation even under slumping profitability we present a model for firm level efficiency under a regime with a probability of failure explaining this phenomenon the model is based on the hypothesis that the regulatory choice of method can be associated with intrinsic flaws leading to judicial repeal and replacement of it by a low powered regime the results show that the cost efficiency policy is proportional to the type of firm cost of effort value of time discount factor and the credibility of the method risk of failure a panel data set for 2000 2006 for 128 electricity distributors in sweden is used to validate the model predictions radical productivity slowdown failing profitability and efficiency at the launch and demise of a non credible regulation method the work highlights the fallacy of viewing incentive regulation as a method independent instrument a result applicable in any infrastructure regulation

a theory of yardstick competition in the typical regulatory scheme a franchised monopoly has little incentive to reduce costs this article proposes a mechanism in which the price the regulatedfirm receives depends on the costs of identical firms in equilibrium each firm chooses a socially efficient level of cost reduction the mechanism generalizes to cover heterogeneous firms with observable differences medicare s prospective reimbursement of hospitals by using diagnostically related groups is a scheme very similar to the one outlined here

analysis of electricity consumption in the tourism sector a decomposition approach abstract index decomposition analysis ida has become a common tool for studying the evolution of energy consumption in its initial form it comprises three contributions namely activity structure and intensity effects various sectors of activities were studied in the literature by employing ida approach and the present work proposes its application to the electricity consumption in the tourism sector the proposed decomposition analysis is developed on the basis of seven indexes grouped in three macro contributions namely energy intensity economic structure and industrial structure the decomposition is performed in the period 1995 2017 and italy was used as test case for the methodology the analysis highlights that overall the changes in electricity intensity and in the industrial structure were responsible for an increase of the electricity consumption of 5 581 gwh whereas the economic structure was responsible for a decrease of 1 337 gwh their contemporary effect determined a total variation of electricity consumption between 1995 and 2017 of 4 244 gwh results demonstrated that the proposed ida equation specifically tailored for the tourism sector allows to provide a detailed analytical explanation of the factors affecting electricity consumption in the italian tourism sector the same framework can be applied to any other country and source of energy

extended divisia index decomposition of changes in energy intensity a case of korean manufacturing industry abstract this study aims to examine the energy efficiency of the manufacturing industry of korea by using the extended divisia index decomposition of choi and ang 2012 first we applied the sato vartia index decomposition to the energy intensity of the manufacturing industry in korea second we attributed the growth rate of aggregate energy intensity to 10 sub manufacturing industries through two channels real energy intensity and structural change the result of the decomposition illustrates that the aggregate energy intensity index decreased in the period 1981 2010 the index decomposition analysis demonstrates that real energy intensity decreased by 85 85 whereas structural change increased energy intensity by 69 37 over the same period of time the negative effect of structural change is partly a result of the increasing portion of energy intensive industry in manufacturing the result reflects that industrial structure in korea can be an important aspect for improving energy efficiency

attribution of changes in divisia real energy intensity index an extension to index decomposition analysis abstract in this paper we extend the methodology of index decomposition analysis ida in energy studies by quantifying the contribution of individual attributes to the percent change of factors such as the real energy intensity index and structural change index we apply the proposed method to the real energy intensity index in the multiplicative logarithmic mean divisia index m lmdi approach a major ida technique since the m lmdi is based on geometric mean type indices and chain computation we need some appropriate method to cope with the difficulties that arise we present a numerical illustration of the proposed method using the energy consumption and real value added data of the us manufacturing industry and compare the results obtained by the fisher real energy intensity index

electricity tariff design for transition economies application to the libyan power system this paper presents a general electricity tariff design methodology especially applicable for transition economies these countries are trying to modernize their power systems from a centralized environment with normally a public vertically integrated electric company to a liberalized framework unbundling electricity companies and eventually starting a privatization process two issues arise as crucial to achieving a successful transition i ensuring cost recovery for all future unbundled activities generation transmission distribution and retailing and ii sending the right price signals to electricity customers avoiding cross subsidies between customer categories the design of electricity tariffs plays a pivotal role in achieving both objectives this paper proposes a new tariff design methodology that complying with these two aforementioned criteria requires a low amount of information regarding system data and customer load profiles this is important since typically volume and quality of data are poor in those countries the presented methodology is applied to computing tariffs for the libyan power system in 2006 using real data

estimating deficit probabilities with price responsive demand in contract based electricity markets studies that estimate deficit probabilities in hydrothermal systems have generally ignored the response of demand to changing prices in the belief that such response is largely irrelevant we show that ignoring the response of demand to prices can lead to substantial over or under estimation of the probability of an energy deficit to make our point we present an estimation of deficit probabilities in chile s central interconnected system between 2006 and 2010 this period is characterized by tight supply fast consumption growth and rising electricity prices when the response of demand to rising prices is acknowledged forecasted deficit probabilities and marginal costs are shown to be substantially lower

electricity market reform failures uk norway alberta and california an analysis of electricity market reforms already taken place in the uk norway alberta canada and california usa leads to our overall conclusion that the introduction of a competitive generation market of itself has failed to deliver reliable service at low and stable prices the market reform failures are attributed to market power abuse by few dominant sellers especially at times of transmission congestion poor market design that invites strategic bidding by suppliers the lack of customer response to price spikes capacity shortage caused by demand growth not matched by new capacity and thin trading of forward and futures contracts that are critical for price discovery and risk management the paper then explains why an electricity market reform can easily fail to deliver the promised gains of better service at lower and more stable prices the policy implication is that an electric market reform can be extremely risky and may lead to a disastrous outcome thus it is imprudent to implement such a reform in countries with limited sites for newgeneration and no indigenous fuels e g israel and hong kong these countries should therefore consider introducing performance based regulation that can immediately benefit electricity consumers in terms of lower prices more stable prices improved reliability more choices while encouraging the electric sector to pursue efficient operation and investment r 2003 elsevier science ltd all rights reserved

oligopolistic competition of gencos in reactive power ancillary service provisions the need for a market based approach for reactive power procurement has been recognized by ferc due to the localized characteristic of reactive power regulatory mechanisms are necessary to mitigate the possibility of holding market power by generators the regulator is responsible for devising the regulatory mechanisms that provide incentives to generators to supply reactive power while preventing the abuse of market power this paper proposes a mathematical model to simulate the strategic behavior of generators supplying reactive power while considering the system operator s schedule the proposed method can be used by the regulator to simulate the market behavior in the reactive power supply we further study how regulatory policies affect the strategic behavior an alternative price cap method has been proposed and tested in the numerical example to mitigate the effect of strategic behavior of generators in reactive power procurement by the system operator the numerical examples are tested on the nordic 32 bus system

service quality in the electricity industry the role of privatization and managerial behavior abstract this paper analyzes the relationship between privatization and service quality in the electricity industry and tests the hypothesis that managerial behavior is a significant intervening factor the sample includes 31 italian distributors over the period 1998 2004 their quality performance is represented by continuity of supply an aspect of quality that is both contractible and regulated results of the empirical analysis suggest that the transfer of shareholdings to private investors does not lead to quality degradation the results also suggest that managerial dominance translates into a reduction in supply quality this effect is likely to be particularly strong for public sector utilities

how efficient are african electricity companies evidence from the southern african countries this paper is a first attempt at documenting efficiency levels in africa s electricity firms their evolution and the sources of this evolution the analysis is based on a sample of 12 operators providing services in the 12 country members of the southern africa power pool we focus on the changes in total factor productivity tfp of the largest operators in each country between 1998 and 2005 we then rely on a data envelopment analysis dea decomposition to identify the sources of the changes in tfp the results suggest fairly comparable levels of efficiency in the region and performance levels and evolution quite independent of the degree of vertical integration the presence of a private actor or the main sources of energy supply the analysis suggest that although the companies have not made significant improvements during the period of analysis in using their capital and human assets they have done much better in adopting better technologies and better commercial practices no clear correlation could be associated with the adoption of reforms during the last decade and data limitations impede a more refined assessment of the impact of reforms on efficiency at this stage

collateral and rationing sorting equilibria in monopolistic and competitive credit markets the authors examine how market structure affects credit allocation under universal risk neutrality and asymmetric information about borrowers they consider both monopolistic and perf ectly competitive banks and examine the role of collateral in each ca se when a bank is a monopolist on the loan side they find collatera l is never used and asymmetric information results in reduced bank le nding under perfect competition collateral has a useful sorting rol e moreover rationing is possible even with collateral availability and perfectly elastic deposit supply in this setting the authors sh ow co signers are valuable social welfare properties of the monopoly and competitive equilibria are also compared copyright 1987 by economics department of the university of pennsylvania and the osaka university institute of social and economic research association

asymmetric information incentives and price cap regulation a regulatory incentive mechanism is presented in which the regulated firm has superior information about both cost and demand compared to the regulator the mechanism leads to truthful revelation of the demand function and extracts all rents due to private demand information in a nondistorting way the scheme assumes that the regulator can observe lagged expenditures by the firm this mechanism leads to efficient pricing operating and investment behavior by the firm finally it is shown that the mechanism is closely related to recent proposals for price cap regulation and that under certain assumptions simple modifications of these proposals will lead to the mechanisms discussed herein

a further assessment of the hong kong government s proposed post 2008 regulatory regime for local electricity utilities abstract the current regulatory contract between the hong kong government and the two local power suppliers will expire in 2008 to elicit constructive ways to refine this regulatory contract upon its expiration in two years the hong kong government recently issued a public consultation paper an earlier viewpoint by woo horowitz and tishler 2006 warns that if the proposals provided in this consultation paper are fully adopted it will do more harm than benefiting the industry while its concern is valid that viewpoint has not suggested specific improvements of the existing arrangement and how incumbent firms incentives to invest will not be harmed under the new arrangement hence this viewpoint contributes to hong kong electricity policy debate by filling this gap with the hope of aiding the regulator to better regulate the market in the years after the current contract s expiration

the regulation of privatized monopolies in the united kingdom this article examines the experience in the united kingdom with the regulation of privatized monopolies its conclusions are 1 that there are significant differences between rpi x or price cap and u s rate of return regulation which provides greater scope for bargaining in the former system 2 that u k regulators have taken seriously their duty to promote competition but that the existing economic literature is of limited help in this task 3 that price regulation is likely to be more effective where technology is changing slowly and or where technology is changing rapidly and 4 that the case for rpi x price cap rather than rate of return regulation is strongest in telecommunications gas supply and electricity supply and least strong in gas and electricity transmission grids

framework for assessing the economic efficiencies of long run network pricing models this paper presents a framework for assessing the economic efficiency of different long run network pricing models the aim is to provide a quantifiable efficiency measure that will inform regulators network operators and network users when an alternative pricing model is contemplated the efficiency measure is derived from the long term network development costs that flow from a dynamic interaction between network pricing and planning that is the response of network users to differing charging models the consequential network investment and new financial incentives that follow reinforcement of the network to illustrate the approach the framework has been used to assess the relative efficiency of three broad class of distribution pricing models in a study undertaken for the great britain gb s regulator for gas and electricity markets in england wales and scotland ofgem the study contemplated three pricing models that are used in practice the efficiency assessment in the ofgem study was conducted on a pseudo distribution reference network on the assumption that the results from the reference network could be scaled up to the national level then the assessment suggests that by moving from the present drm model to the more economic lric approach gb distribution network operators could save in the region of pound200 m over the next 20 years in their network investment costs this paper draws heavily on the project undertaken for ofgem but any views expressed are solely those of the authors

electricity industry restructuring in iran abstract iran as a developing country with a growing population has an increasing energy consumption in particular the electricity consumption with the average annual growth rate of 7 24 has been increasing considerably over the past two decades in step with the changes in the world electricity industry initial steps towards restructuring in iran s electricity industry were taken during the 1990s resulting in the launching of iranian wholesale electricity market in november 2003 achieving long term security of supply clarification of the electricity price and the attraction of the private investments are some of the main goals of the electricity industry restructuring in iran the privatization and breaking of the governmental monopoly was officially started in 2000 with the beginning of the third development plan which led to the 48 05 contribution of the private sector in the annual energy generation in 2015 this paper investigates the process of restructuring in iranian electricity industry comprehensively the current situation and the history of iran s electricity industry as well as the operating principles of iran s electricity market and its prominent characteristics including its regulations entities and administrative process are discussed in this paper moreover some of the results including privatization process and the changes in the electricity price are investigated in this paper

driving forces of rapid co2 emissions growth a case of korea abstract this study aims to investigate korea s final demand structure and its impacts on co 2 emissions in order to reduce co 2 emissions and develop environmental policy directions based on the environmentally extended input output model this study adopts a two step approach 1 to estimate the embodied emissions and their intensities for 393 sectors induced by final demand and 2 to calculate the driving factors of emission growth between 2003 and 2011 and then evaluate the result by using structural decomposition analysis sda the findings of this study demonstrate that the impact of composition change in export with less embodied emission intensities tends to offset the increase in co 2 emission by the export scale growth the relatively low residential electricity price has resulted in the rapid growth of household electricity consumption and significantly contributed to emissions growth the result of sda indicates that korea s final demand behavior yielded high carbonization over the same period the findings suggest that korean government should promote exports in industries with less embedded co 2 in order to protect environments in addition emission information of each product and service should be provided for consumers to change their purchase patterns towards contributing to low carbon emissions as active players

the importance of energy quality in energy intensive manufacturing evidence from panel cointegration and panel fmols this paper expands on the panel gdp energy cointegration modeling literature it does so by using data disaggregated along sectoral lines and adjusting energy consumption for the quality of the energy source e g electricity is of higher quality than oil which is of higher quality than coal in order to examine the role of energy quality in the five most energy intensive manufacturing sectors iron and steel non ferrous metals non metallic minerals chemicals and pulp and paper the database was constructed by combing energy consumption and energy price data to construct the energy quality index from the iea with economic data value added labor employed and physical capital from the oecd s structural analysis database in addition to finding the variables analyzed are panel i 1 and cointegrated for each sector based panel the long run elasticity estimates from panel fmols indicate the importance of energy quality primarily the shift toward the use of high quality electricity in these energy intensive manufacturing sectors in each case the elasticity for energy quality is greater than that for conventionally measured energy consumption sometimes orders of magnitude greater indeed the elasticity of conventionally measured energy consumption is insignificant to very small for three of the five sectors also when using the energy quality measure the importance of energy consumption relative to the other production factors stands out such results are useful for both energy gdp cointegration causality modelers and cge modelers who may need to estimate elasticities

commitment lending under asymmetric information theory and tests on u k startup data u k business startup data is used to examine the role of contract parameters in solving the bank s problem of lending under asymmetric information margins are found to be a direct function of the probability of failure and an inverse function of security for given loan size consistently with collateral being invoked to solve the moral hazard problem business survival is also found to be enhanced by owner equity inputs for given debt again consistent with a requirement for owner financial inputs to enhance unobservable effort security rises along with loan size and survival chances a finding consistent with a a firm loan size effect larger borrowers have lower marginal admin cost to the bank and with b positive borrower self selection better borrowers offer collateral because they are less likely to experience forfeiture observable business characteristics are found to play an important intermediary role in the solution to the moral hazard problem more mature proprietors have more experience business commitment assets for borrowing and the willingness to use them for loan collateral their contract parameters reflect these facts

demand side management in china the context of china s power industry reform abstract the reform of china s power industry has lasted for decades while the implementation of demand side management dsm in china is still in its infancy in this paper we present a comprehensive study of the dsm and demand response dr programs in china under the context of china s power industry reform we first present a brief introduction of the background including the socio economic status and geographical location of china the energy policy of china china s power industry the smart grids and microgrid in china and the reform of china s power industry then based on the introduction of dsm and the analysis of dsm practices in some countries we discuss the development status of dsm and the reform of electricity pricing in china finally the main challenges in five aspects for the future development of dsm programs in china are proposed and discussed these challenges include customer understanding and participation advanced metering infrastructure ami and information and communication technology ict pricing mechanisms and optimal scheduling big data analytics based decision support as well as government regulations and market policies

electricity demand and basic needs empirical evidence from china s households an increasing block tariff ibt has been implemented nationwide in the residential sector in china since 2012 however knowledge about ibt design is still limited particularly how to determine the electricity volume for the first block of an ibt scheme assuming the first block should be set based on some measure of electricity poverty we attempt to model household electricity demand such that the range of basic needs can be established we show that in chinese households there exists a threshold for electricity consumption with respect to income which could be considered a measure of electricity poverty and the threshold differs between rural and urban areas for rural urban families electricity consumption at the level of 7th 5th income decile households can be considered the threshold for basic needs or a measure of electricity poverty since household electricity demand in rural urban areas does not respond to income changes until after 7th 5th income decile accordingly the first ibt block for some provinces e g beijing appears to have been set at a level that is too high over time however given continued rapid growth the ibt will begin to better reflect actual basic needs

are business startups debt rationed using a large random sample of u k start ups and a rich data set the paper demonstrates that human capital is the true determinant of survival and that the correlation between financial capital and survival is spurious provision of finance is demand driven with banks supplying funds elastically and business requests governing take up firms self select for funds on the basis of the human capital endowments of the proprietors with better businesses more likely to borrow a reason why others have seemingly identified start up debt gaps may be the failure to test a sufficiently rich empirical model copyright 1996 by royal economic society

discussion of distribution pricing based on yardstick regulation the authors discuss the original paper distribution pricing based on yardstick regulation j w marangon lima et al see ibid vol 17 p 198 204 2002 covering the following subject areas incremental and marginal costs distribution expansion planning tariff design information asymmetries open access distribution pricing and wire and commercialization business

analysis of co2 emissions in apec countries a time series and a cross sectional decomposition using the log mean divisia method abstract we decompose the changes of co2 emissions in apec countries over time as well as the differences of co2 emissions among three income groups of apec countries at a given period of time based on the logarithmic mean divisia decomposition approach among the major findings of the paper the growth in per capita gdp and population are the two dominant contributors to the increase in co2 emissions in most cases furthermore energy efficiency and fuel switching are found to be the two most promising fields for possible cooperation between apec member countries

a critical assessment of the hong kong government s proposed post 2008 regulatory regime for local electricity utilities abstract in december 2005 the hong kong government issued a consultation paper on future development of the electricity markets in hong kong stage ii consultation proposing a post 2008 regulatory regime upon the expiration of the existing regulatory contract between the hong kong government and each of the two local electricity utilities we assess the proposal using the criteria of safe reliable and environmentally friendly service at the lowest rates that will allow the utilities reasonable returns on their investments we caution that if fully adopted the highly risky proposal may lead to less reliable service without the compensating benefits to the environment

the benefits of lending relationships evidence from small business data this paper empirically examines how ties between a firm and its creditors affect the availability and cost of funds to the firm we analyze data collected in a survey of small firms by the small business administration the primary benefit of building close ties with an institutional creditor is that the availability of financing increases we find smaller effects on the price of credit attempts to widen the circle of relationships by borrowing from multiple lenders increases the price and reduces the availability of credit in sum relationships are valuable and appear to operate more through quantities rather than prices

electricity tariffs in hong kong what went wrong and what can we do about it the hong kong economy has undergone radical changes over the past two decades and as a result profoundly affected the electricity supply industry the level of excess capacity maintained by the two vertically integrated utilities and the tariffs they charged are both one of the highest among all developed countries and they are the adverse results of the scheme of control regulation what happened in the local electricity market has drawn much criticism among researchers and consumer groups and major reform of the entire market is being suggested this paper outlines the structure of the electricity supply industry and its regulatory arrangement in hong kong and discusses the problems and inefficiencies caused by the specific type of regulation without compromising efficiency a number of policy alternatives are proposed with a view to rectify the current problems

performance based regulation of the electricity supply industry in hong kong an empirical efficiency analysis approach this paper presents an empirical efficiency analysis approach to analyze the efficiency and performance of utilities and its effects on prices under the price cap performance based regulation pbr model a data envelopment analysis dea like frontier based method is used to compute the total factor productivity with the malmquist productivity index results of case studies support the use of the approach to account for the relation of the x factor and the pbr model on the two power utilities in hong kong s electricity supply industry

dea efficiency for the determination of the electric power distribution added value the application of data envelopment analysis methodology is formulated as a tool to determine the distribution added value required in the tariff fixation processes of electrical power distribution that use the concept of model firm as a regulatory basis in order to increase the reliability of the obtained results a bootstrap technique is applied its application is illustrated within the framework of the latest regulatory process in chile

regulatory effects on electricity prices in hong kong abstract in hong kong electricity is supplied by two investor owned utilities china light and power company limited clp and the hongkong electric company limited hec these two utilities operate under a special regulatory arrangement known as the scheme of control which was proposed by the industry in 1964 the objective of this paper is to evaluate whether the scheme of control has fulfilled its original intention of protecting both the producer s right to serve and the consumer s right to be served our empirical results have indicated that the first scheme of control 1964 1978 had a greater effect on reducing electricity prices than the second one 1979 1992

diversification incentives under price based and cost based regulation this article considers two schemes of regulationforfirms that serve both monopoly markets and markets subjected to substantial competition the first form cost based regulation combines elements of rate of return regulation on monopoly markets with filly distributed cost pricing much like the form of regulation currently in place in the domestic telephone industry the secondform price based regulation would establish rate caps on noncompetitive services and allow the firm to enter into competitive markets and charge whatever prices it might like in those markets models of both forms of regulation are developed and analyzed with respect to incentives for cost misreporting choice of technology cost reducing innovation choices of prices and output levels and diversification into competitive markets

sustaining china s electricity market development abstract china s 12th five year plan addresses new challenges and sets new goals in the country s power sector the structure of power generation development is to be optimised to properly balance coal transportation and power transmission the controversy over the direction of grid transmission and distribution is also to be reconciled the plan puts forward specific requirements for energy conservation developing clean energy optimising the production of coal fired electricity rationalising the allocation of peak power developing distributed energy and constructing a strong smart grid it also strongly advocates renewable and other forms of clean energy resources considering all the above goals and requirements it is necessary for china to adjust its blueprint for electricity market development by fine tuning the original market oriented reform momentum this paper aims to design a policy framework for this and discusses how china should develop policies and strategies to meet these requirements and achieve these goals examples of compatible international experiences illustrate how china can secure a sustainable energy future

a multi region multi sector decomposition and attribution analysis of aggregate carbon intensity in china from 2000 to 2015 abstract index decomposition analysis ida has been used to analyze driving forces of aggregate carbon intensity aci however previous studies mostly explained changes in aci from either sectoral or regional perspective but rarely looked into driving forces of aci from both sectoral and regional perspectives under a unified and consistent framework to fill the research gap this study proposed a multi region multi sector decomposition and attribution approach to analyze driving forces of aci from both sectoral and regional perspectives the empirical results in china show that the aci declined by 33 from 2000 to 2015 from the sectoral perspective the decline can be mainly attributed to the significant energy efficiency improvement in six high energy intensive industries however the rapid growth in electricity consumption especially in chemicals and iron and steel and the expansion of iron and steel industry during 2000 2005 greatly offset the negative effect from energy efficiency from the regional perspective the aci decline can be primarily due to an extensive improvement in energy efficiency in most regions on the contrary the increasing dependency on coal particularly in shandong inner mongolia and guangdong and the increased share of carbon intensive industries in some provinces such as guangxi and sichuan markedly increased aci based on the results the effectiveness of underlying sectoral and regional level policies and measures implemented for aci reduction in china were evaluated