the renewables portfolio standard in texas an early assessment texas has rapidly emerged as one of the leading wind power markets in the united states this development can be largely traced to a well designed and carefully implemented renewables portfolio standard rps the rps is a new policy mechanism that has received increasing attention as an attractive approach to support renewable power generation though replacing existing renewable energy policies with an as of yet untested approach in the rps is risky early experience from texas suggests that an rps can effectively spur renewables development and encourage competition among renewable energy producers initial rps targets in texas were well exceeded by the end of 2001 with 915 mw of wind installed in that year alone rps compliance costs appear negligible with new wind projects reportedly contracted for well under 3 us cent k wh in part as a result of a 1 7 us cent kwh production tax credit an outstanding wind resource and an rps that is sizable enough to drive project economies of scale obliged retail suppliers have been willing to enter into long term contracts with renewable generators reducing important risks for both the developer and the retail supplier finally the country s first comprehensive renewable energy certificate program has been put into place to monitor and track rps compliance c 2002 published by elsevier science ltd less

cost competitive incentives for wind energy development in china institutional dynamics and policy changes abstract this paper presents an overview of the development of wind power in china the factors that affect the directions of wind power development are analyzed it examines the economics of windfarm development and compares it with conventional energy sources the major constraints in wind technology development and defects of the current policies are discussed it points out that wind power development should be subject to rational policy change and institutional adjustment it discusses the incentive mechanisms and institutional frameworks for future development particular importance is attributed to market incentives for wind power to reach the objectives of industrialization and commercialization a number of cost competitive incentive measures and policies are recommended i introducing market based mechanisms through standard power purchase agreement ii establishing effective investment policies and regulations to attract private investment iii promoting localization of wind turbine production iv adjusting tax and subsidy policies and v reforming governmental institutions to make clear rules and responsibilities for policymaking and enhancing communication coordination between relevant government agencies in order to formulate uniform and effective policies

a step toward understanding wind power development policy barriers in advanced economies abstract a widely accepted premise regarding wind power development policy is that implementation of economic policy instruments which are designed to close the cost gap between wind power and entrenched fossil fuel power generation technologies will significantly catalyze enhanced levels of wind power development activity this paper contests this premise by arguing that non economic barriers to wind power development have the capacity to significantly inhibit wind power development in industrialized nations despite the implementation of economic policy instruments forces which deter wind power development in four economically advanced economies that exhibit phlegmatic progress in wind power development australia canada japan and taiwan are identified and amalgamated into a step framework describing social technical economic and political forces that inhibit wind power development the conclusions of this analysis are twofold first failure to mitigate these step forces may undermine the efficacy of any given economic policy instrument that aims to close the cost gap between wind power and entrenched generation technologies second attempts to mitigate these impediments might represent a way to achieve better policy results with less government financial commitment

planning of renewables schemes deliberative and fair decision making on landscape issues instead of reproachful accusations of non cooperation abstract the main issues related to successful implementation policies concern the socio economic institutions that are conditional to planning in the energy policy domain but also in the domain of spatial planning successful investments and the siting of renewable power plants eventually determine the success rate of national efforts in establishing renewable capacity central planning usually has several objectives and these often have a detrimental effect on the goal of renewable energy application current problems related to implementation decisions concerning wind power schemes are an example to those who will be faced by other renewable power plants notably biomass regarding community acceptance of wind power schemes the visual evaluation of the impact of wind power on the values of the landscape is by far the most dominant factor in explaining opposition or support type of landscape fully overshadows other attitudinal attributes as well as other visual and scenic factors such as the design of wind turbines and wind farms and the number and the size of turbines planning regimes and decision making practices that really enhance the implementation processes of renewable energy require strong ecological modernization this means institutional changes that create involvement and trust of actors at the actual implementation level local opposition cannot be explained by the egotistical motives of local residents when the inclination to behave according to supposed backyard motives is investigated the scale to measure this phenomenon appears to indicate commitment to equity issues and fairness of decision making hence for wind power local involvement to represent the local values of site specific landscapes is crucial for other renewables the source specific features are different but conflicts can be expected as well because the fairness of implementation decisions will be equally significant

wind power development in sweden global policies and local obstacles abstract recently the swedish government adopted a national planning goal of a yearly wind power generation of 10 twh by 2015 implying a substantial increase from the current 0 6 twh level in this paper we provide an economic assessment of the potential for future wind power investments in sweden in close conjunction with an analysis of the legal attitudinal and policy related uncertainties that face a wind mill investor it is shown that the economics of swedish wind power is negatively affected by a the lack of policy stability b public criticism at the local level and in particular c the legal provisions governing the assessment of the environmental impacts of wind mills and the planning procedures for mill location while national and global energy policies as well as the general public point out wind power as particularly environmentally friendly most of the objections to its expansion at the local level tend to have environmental origins the interests of those who object to wind mill installations gain strong legal protection and the municipal territorial planning monopoly in sweden implies that it is hard to make national energy policy goals heard at the local implementation stage compared to its competitors wind power is the technology that tends to have the most to loose from the risk and uncertainties created by this investment environment the paper identifies and discusses a number of ways in which the national policy interests could be strengthened at the local level we discuss the role of citizen participation as well as solutions within the realms of the legal system moreover since the diffusion of wind power encounters the most strident legal and attitudinal obstacles where it interferes with competing land uses a move offshore appears to be an efficient strategy from the perspective of a wind mill investor a stronger political commitment to wind power expansion in legal provisions as well as in the form of long run stability in policy instrument implementation will probably be necessary to attain the 2015 policy goal

income diversification and risk does ownership matter an empirical examination of indian banks abstract we examine the impact of ownership on income diversification and risk for indian banks over the period 2001 2009 we investigate both the determinants of non interest income and the impact of diversification on various profitability and insolvency risk measures for public sector private domestic and foreign banks we document that ownership does matter in the pursuit of non interest income relative to private domestic banks public sector banks earn significantly less fee income while foreign banks report higher fee income public sector banks with higher levels of governmental ownership are significantly less likely to pursue non interest income sources fee based income significantly reduces risk measured by profitability variables for public sector banks default risk is also reduced for these banks from a regulatory perspective it appears that diversification benefits india s public sector banks our research has implications for the changes in the risk profile for banks in emerging banking markets pursuing non interest revenue sources

what is the effect of unconventional monetary policy on bank performance this paper examines the relationship between unconventional monetary policy and the us banking performance unconventional monetary policy is captured through the central bank s assets and excess reserves results show that unconventional monetary policy has a negative relationship with bank performance further analysis shows that the negative association between unconventional monetary policy and performance is mitigated for banks with a high level of asset diversification and low deposit funding we also find that the negative relationship between unconventional monetary policy and performance subdues for deposit insured financial institutions finally we use dynamic panel threshold analysis which reveals that the negative association between unconventional monetary policy and bank performance is particularly pronounced above the reported threshold value

evaluating natural resource investments notwithstanding impressive advances in the theory of finance over the past 2 decades practical procedures for capital budgeting have evolved only slowly the standard technique which has remained unchanged in essentials since it was originally proposed see dean 1951 bierman and smidt 1960 derives from a simple adaptation of the fisher 1907 model of valuation under certainty under this technique expected cash flows from an investment project are discounted at a rate deemed appropriate to their risk and the resulting present value is compared with the cost of the project this standard textbook technique reflects modern theoretical developments only insofar as estimates of the discount rate may be obtained from crude application of single period asset pricing theory but see brennan 1973 bogue and roll 1974 turnbull 1977 constantinides 1978 the inadequacy of this approach to capital budgeting is widely acknowledged although not widely discussed its obvious deficiency is its the evaluation of mining and other natural resource projects is made particularly difficult by the high degree of uncertainty attaching to output prices it is shown that the techniques of continuous time arbitrage and stochastic control theory may be used not only to value such projects but also to determine the optimal policies for developing managing and abandoning them the approach may be adapted to a wide variety of contexts outside the natural resource sector where uncertainty about future project revenues is a paramount concern

charter value risk taking and systemic risk in banking before and after the global financial crisis of 2007 2008 we investigate how bank charter value affects risk for a sample of oecd banks by using standalone and systemic risk measures before during and after the global financial crisis of 2007 2008 prio

does banks systemic importance affect their capital structure and balance sheet adjustment processes abstract frictions prevent banks to immediately adjust their capital ratio towards their desired and or imposed level this paper analyzes i whether or not these frictions are larger for regulatory capital ratios vis a vis a plain leverage ratio ii which adjustment channels banks use to adjust their capital ratio and iii how the speed of adjustment and adjustment channels differ between large systemic and complex banks versus small banks our results obtained using a sample of listed banks across oecd countries for the 2001 2012 period bear critical policy implications for the implementation of new systemic risk based capital requirements and their impact on banks balance sheets specifically lending and hence the real economy

the effects of foreign strategic investors on business models in china s commercial banks does ownership structure matter abstractintroducing foreign strategic investors fsis is a vital step in the ownership reforms of china s banking industry using china s data from 1995 to 2014 we employ propensity score matching and difference in differences approaches to investigate the effects of fsis on the business models of chinese banks including income structure and funding structure we find that fsis significantly influence income structure the bank s non interest income nii share significantly rises after introducing fsis the higher ownership shares of fsis are associated with the higher nii share and the nii share has been increased when fsis assign directors or senior managers to chinese banks we also report that the effects of fsis on income structure are weaker in state owned banks than those in other banks and ownership concentration weakens the links between fsis and income structure finally this article shows that fsis have no significant influence on funding structure these findings will be informative and

undesired reinforcement of harmful self evident truths concerning the implementation of wind power abstract this viewpoint draws attention to a lingering simplistic and faulty interpretation of the complex phenomenon of acceptance of renewables and their implementation in concrete projects by all relevant actors namely the backyard theory during the last decade research that investigated nimby has provided support to disprove the two prime hypotheses proximity and decreasing property value the current mainstream trend in academic circles is clearly towards abandoning nimby explanations however in practice among developers and policymakers nimby thinking still prevails unfortunately there is also some academic writing that persists in recycling the backyard theory despite ample research to the contrary thus feeding this faulty interpretation of implementation problems a recent review of the state of the art of wind power implementation is taken as an example it presents nimby as a common sense self evident truth while to support this explanation it cites publications that actually refute this view and instead support the mainstream move towards abandoning nimby thinking this shift is important because further academic support for this concept would serve to hinder rapid deployment of wind power and also other renewables

contagion and banking crisis international evidence for 2007 2009 abstract policy makers aim to avoid banking crises and although they can to some extent control domestic conditions internationally transmitted crises are difficult to tackle this paper identifies international contagion in banking during the 2007 2009 crisis for 54 economies we identify three channels of contagion systematic idiosyncratic and volatility and find evidence for these in 45 countries banking crises are overwhelmingly associated with the presence of both systematic and idiosyncratic contagion the results reveal that crisis shocks transmitted from a foreign jurisdiction via idiosyncratic contagion increase the likelihood of a systemic crisis in the domestic banking system by almost 37 percent whereas increased exposure via systematic contagion does not necessarily destabilize the domestic banking system thus while policy makers and regulatory authorities are rightly concerned with the systematic transmission of banking crises reducing the potential for idiosyncratic contagion can importantly reduce the consequences for the domestic economy

diversification in banking is noninterest income the answer this paper assesses potential diversification benefits in the u s banking industry from the steady shift toward activities that generate fee income trading revenue and other types of noninterest income in the aggregate declining volatility of net operating revenue reflects reduced volatility of net interest income not diversification benefits from noninterest income which is quite volatile and increasingly correlated with net interest income at the bank level greater reliance on noninterest income particularly trading revenue is associated with lower risk adjusted profits and higher risk this suggests few obvious diversification benefits from the ongoing shift toward noninterest income

determinants of income diversification evidence from chinese banks this article presents an analysis of the determinants of chinese commercial banks income diversification decisions using a panel dataset comprising 88 chinese domestic banks from 2003 to 2010 we

why banks are not too big to fail evidence from the cds market this paper argues that bank size is not a satisfactory measure of systemic risk because it neglects aspects such as interconnectedness correlation and the economic context in order to differentiate the effect of bank size from that of systemic importance we control for systemic risk using the covar measure introduced by adrian and brunnermeier 2011 we show that a bank s contribution to systemic risk has a significant negative effect on banks credit default swap cds spreads supporting the too systemic to fail hypothesis once we control for systemic risk bank size relative to gross domestic product gdp has either no or a positive effect on banks cds spreads the effect of bank size increases in the home country s debt ratio and turns positive already at moderate debt ratios this result is consistent with the too big to save hypothesis we show further that the effect of systemic risk rises sharply at the onset of the financial crisis in august 2007 but weakens after the failure of lehman brothers reflecting changing bailout expectations taken together our results suggest that banks are not too big to fail but they may be too systemic to fail and too big to save andreas barth and isabel schnabel

the role of policy instruments in the innovation and diffusion of environmentally friendlier technologies popular claims versus case study experiences abstract moving towards sustainability will require that new environmentally friendlier technologies are developed and widely adopted policy instruments that promote eco efficiency are therefore necessary some claims frequently made in the literature on the relationship between policy instruments and technological development are examined the claims concern regulations environmental taxation and funding of research and development the claims are explored on the basis of empirical evidence from two sectors the pulp and paper industry and the marine engine industry little support was found for some of the claims in some cases even contradictory findings and for some claims the findings differed between the sectors and even within a sector depending on the issue

eu renewable energy support policy faith or facts the recent eu commission proposal for promoting the supply of power from renewable energy sources was originally based on a pan european harmonised tradable green certificate tgc scheme we suggest on the basis of a multi disciplinary analysis that a pan eu tgc system is not the way forward for europe it is vital that the commission and the majority of member states avoids implementation of such policy designs put forward by a coalition of vested interests they should instead look at and act upon the available evidence from those countries that have experimented with tgcs e g flanders uk and sweden and design policies that stand a better chance of meeting the criteria of effectiveness efficiency and equity in particular the policies must enable eu to meet the immense innovation industrialisation challenge by inducing the development of a capital goods industry that can eventually diffuse a broad range of technologies that use renewable energy sources only then we can acquire an ability to implement an industrial revolution in the energy system in a way that broadly meets the criteria of effectiveness and dynamic efficiency

foreign bank diversification and efficiency prior to and during the financial crisis does one business model fit all diversified and focused business models may affect foreign bank efficiency differently we investigate whether there is an optimal business model along three business dimensions assets funding and income and which business model is optimal for foreign banks in a financial center we apply recently developed non parametric methods with bootstrap to estimate group efficiency to test for differences across groups and finally to analyze the link between bank efficiency and diversification measures using luxembourg bank data that include the financial crisis we find that there is no unique business model the most efficient business model appears to be a focused asset funding and income strategy banks organizational forms play a role branches may be preferable to subsidiaries prior to the financial crisis whereas bank subsidiaries perform better than branches during the financial crisis however branches diversified in assets funding and income exploit efficiency advantages during the financial crisis

competition and increasing returns to scale a model of bank size this study examines the causal effects of bank size on banks survival asset quality and leverage two forces drive these effects increasing returns to scale derived from banks expertise and competition the first enables bigger banks to survive competition better have higher asset quality and be more leveraged it drives banks into a race for expansion this race toughens competition between banks which edges out small banks and may worsen all banks asset quality consequently the banking industry will be dominated by a small number of highly leveraged banks in this study financial intermediation arises endogenously and co exists with direct finance

gas fired power plants investment timing operating flexibility and co2 capture we analyze investments in gas fired power plants based on stochastic electricity and natural gas prices a simple but realistic two factor model is used for price processes enabling analysis of the value of operating flexibility the opportunity to abandon the capital equipment as well as finding thresholds for energy prices for which it is optimal to enter into the investment we develop a method to compute upper and lower bounds on plant values and investment threshold levels our case study uses representative power plant investment and operations data and historical forward prices from well functioning energy markets we find that when the decision to build is considered the abandonment option does not have significant value whereas the operating flexibility and time to build option have significant effect on the building threshold furthermore the joint value of the operating flexibility and the abandonment option is much smaller than the sum of their separate values because both are options to shut down the effects of emission costs on the value of installing co2 capture technology are also analyzed

community perspectives of wind energy in australia the application of a justice and community fairness framework to increase social acceptance decisions concerning the siting of infrastructure developments or the use of natural resources have the potential to damage a community s social well being if the outcomes are perceived to be unfair justice is accepted as central to the well functioning of society with fairness being an expectation in day to day interactions outcomes that are perceived to be unfair can result in protests damaged relationships and divided communities particularly when decisions are made which benefit some sections of the community at the perceived expense of others through empirical research using a wind farm pilot study community perceptions of a community consultation process are explored using procedural justice principles to evaluate fairness findings from the pilot study indicate that perceptions of fairness do influence how people perceive the legitimacy of the outcome and that a fairer process will increase acceptance of the outcome a key research finding was that different sections of a community are likely to be influenced by different aspects of justice namely by outcome fairness outcome favourability and process fairness based on this finding a community fairness framework was developed which has potential application in community consultation to increase social acceptance of the outcome

basic concepts for designing renewable electricity support aiming at a full scale transition by 2050 abstract renewable electricity supply is a crucial factor in the realization of a low carbon energy economy the understanding is growing that a full turn over of the electricity sectors by 2050 is an elementary condition for avoiding global average temperature increase beyond 2 c this article adopts such full transition as europe s target when designing renewable energy policy an immediate corollary is that phasing in unprecedented energy efficiency and renewable generation must be paralleled by phasing out non sustainable fossil fuel and nuclear power technologies the double phasing programme assigns novel meaning to nearby target settings for renewable power as share of total power consumption it requires organizing in the medium term eu wide markets for green power a highly demanding task in the present context of poorly functional markets in brown power the eu commission s 2007 2008 proposals of expanding tradable certificates markets were not based on solid analysis of past experiences and future necessities the keystone of sound policies on renewable electricity development is a detailed scientific differentiation and qualification of renewable electricity sources and technologies for measuring the huge diversity in the field we provide but structuring concepts about such qualification because implementation requires extensive research resources support for renewable electricity development is organized via feed in prices or premiums and via quota obligations connected to tradable green certificates green certificates are dependent on physical generated renewable power but separable and no joint products contrary to conventional wisdom we argue their separation in cost analysis but firm linking during trade a few graphs illustrate the importance of assigning qualities to different renewable power sources technologies feed in systems based on an acceptable qualification perform generally better than certificate markets imposing uniform approaches on a very diverse reality for a similar reason uniform and undifferentiated taxation of non sustainable energy sources cannot replace renewable energy support schemes capable of differentiation

wind power implementation the nature of public attitudes equity and fairness instead of backyard motives abstract public attitudes anywhere in europe show moderate to strong support for the implementation of renewable energy nevertheless planning wind power developments appears to be a complicated matter in most countries the problems that have to be dealt with during decision making processes on the siting of wind turbines are usually referred to as mere communication problems however public attitudes towards wind power are fundamentally different from attitudes towards wind farms this gap causes misunderstandings about the nature of public support for renewables in particular where planners easily assume support for renewables can be generated by information campaigns emphasising the environmental benefits whereas opposition to renewable energy schemes can be explained by a selfish not in my backyard attitude both explanations used by planners authorities and unfortunately by many scholars are falsified furthermore policies that still take this common knowledge for granted can have negative consequences for the implementation rates of renewables visual evaluation of the impact of wind power on landscape values is by far the dominant factor in explaining why some are opposed to wind power and others are supporting it moreover feelings about equity and fairness appear the determinants of backyard motives instead of selfishness

predicting price spikes in electricity markets using a regime switching model with time varying parameters this paper shows that a stochastic regime switching model can represent the volatile behavior of wholesale electricity prices associated with price spikes effectively the structure of the model is very flexible because the mean prices in the two regimes and the two transition probabilities are functions of the load and or the implicit reserve margin using price data from the single settlement market in pjm may 1999 to may 2000 the results show that the estimated switching probability from the low to the high regime predicts price spikes well if the reserve margin is measured accurately

institutional factors influencing strategic decision making in energy policy a case study of wind energy in france and quebec canada abstract this article studies the different institutional factors that influence a strategic wind energy decision making process through a comparative transnational study of quebec canada and france research confirms that political choices are dynamic and vary with a change in the wind energy context the balance of power between pressure groups supranational influences energy evaluation approaches and social acceptance until the 90 s an initially unfavorable national energy context combined with a neocorporatist culture as defined by szarka 2004 1 limited the place of wind energy in both jurisdictions in the 2000 s a political window opened when the private sector penetrated the market with the deregulation of the electricity sector exogenous pressure from the european union in france endogenous pressure from social actions in quebec and a more favorable energy context in both cases however this political window was short lived due to social acceptance issues in quebec political will was stronger until 2013 now the social controversy surrounding wind energy has shifted from the local to the national level projects are better accepted locally because of local financial involvement but an anticipated electricity surplus questions the relevance of new energy projects in france political support depends on the government in power between 2005 and 2013 the reduction in annual wind power installations from 1246 mw to 621 mw was due to the major influence of the anti wind lobby on a right wing government after 2013 the left wing government s arrival coincided with a phasing out of several regulatory and financial uncertainties today both jurisdictions are at a crossroads and the future energy mix will depend on the relative influence of the institutional components identified in our opinion key solutions to more sustainable political choices are conditioned by an improvement in the way projects and policies plans and programs are assessed

off balance sheet activity under adverse selection the european experience abstract in the crisis that started in 2007 banks off balance sheet activity has been blamed for flooding the market with low quality assets and contributing to spreading risk throughout the economic system nevertheless this view is hardly sustainable within the context of sophisticated markets this paper puts forward an alternative interpretation of the off balance sheet market the so called adverse selection hypothesis according to this hypothesis an adverse selection problem characterizes the relation between banks and their counterparties in off balance sheet deals empirically this implies that off balance sheet activity is expected to be negatively related to failure risk whereas it is expected to be positively related to the quality of the assets used for off balance sheet operations we test the adverse selection hypothesis for a sample of banks in the 27 member countries of the european union during the pre crisis period 1996 2006 and the crisis period 2007 2009 in addition we check for possible differences between banks in the first 15 members of the european union and those in the 12 new members

non performing loans moral hazard and regulation of the chinese commercial banking system abstract non performing loans npls represent a major obstacle to the development of banking sector one of the key objectives of the banking sector reforms in china has therefore been to reduce the high level of npls to do so chinese regulatory authorities have injected significant capital into the banking system and scrutinized npls since 2003 this paper examines the impact of npls on bank behavior in china using a threshold panel regression model and a dataset covering 60 city commercial banks 16 state owned banks and joint stock banks and 11 rural commercial banks during 2006 2012 we test whether lending decisions of chinese banks exhibit moral hazard the results support the moral hazard hypothesis suggesting that an increase in the npls ratio raises riskier lending potentially causing further deterioration of the loan quality and financial system instability policy implications of findings are evaluated

the diversification and financial performance of us credit unions abstract for us credit unions revenue from non interest sources has increased significantly in recent years we investigate the impact of revenue diversification on financial performance for the period 1993 2004 the impact of a change in strategy that alters the share of non interest income is decomposed into a direct exposure effect reflecting the difference between interest and non interest bearing activities and an indirect exposure effect which reflects the effect of the institution s own degree of diversification on both risk adjusted and unadjusted returns measures a positive direct exposure effect is outweighed by a negative indirect exposure effect for all but the largest credit unions this may imply that similar diversification strategies are not appropriate for large and small credit unions small credit unions should eschew diversification and continue to operate as simple savings and loan institutions while large credit unions should be encouraged to exploit new product opportunities around their core expertise

conceptualizing the acceptance of wind and solar electricity drawing from research interviews and the academic literature this article conceptualizes the conditions that promote investor confidence and the social acceptance of wind and solar sources of electricity it explores the factors influencing the acceptance of commercial wind turbines in denmark and india and residential solar panels in germany and the united states the article begins by justifying its selection of case studies and explaining the methodology behind its research interviews and field visits it then summarizes some of the key findings in recent surveys of public attitudes and market acceptance concerning renewable energy with a focus on why some investors and communities reject wind and solar systems whereas others rapidly approve and adopt them the article proposes that acceptance has multiple dimensions socio political community and market that must be met holistically in order for investors and users to embrace renewable energy the article argues that acceptance hinges upon the prevalence of nine factors the lack of such factors creates environments where they are rejected the theory is tested against four case studies that explore the forces driving renewable energy in denmark germany india and the united states

universal banking and firm risk taking abstract this paper analyzes the welfare implications of banks taking equity stakes in firms under conditions of imperfect information and moral hazard two cases of bank control over investment decisions are analyzed in the first the bank does not control the investment decisions of the firm here the investment efficiency is higher and bank risk is lower for an optimal positive level of bank equity holdings however in the case when the bank has veto power over investment proposals by the firm there is a trade off between increased investment efficiency and increased bank risk

does the size of islamic banking matter for industry growth international evidence islamic banking which has witnessed unprecedented growth in the last quarter of the century is hypothesized to be able to contribute to the development of the financial sector and thus to economic

social acceptance of renewable energy innovation an introduction to the concept this paper introduces the special issue on social acceptance of renewable energy innovation it is a collection of best papers presented at an international research conference held in tramelan switzerland in february 2006 while there are ambitious government targets to increase the share of renewable energy in many countries it is increasingly recognized that social acceptance may be a constraining factor in achieving this target this is particularly apparent in the case of wind energy which has become a subject of contested debates in several countries largely due to its visual impact on landscapes this paper introduces three dimensions of social acceptance namely socio political community and market acceptance factors influencing socio political and community acceptance are increasingly recognized as being important for understanding the apparent contradictions between general public support for renewable energy innovation and the difficult realization of specific projects the third dimension market acceptance has received less attention so far and provides opportunities for further research particularly from management scholars

envisaging feed in tariffs for solar photovoltaic electricity european lessons for canada abstract while it is widely agreed that support schemes need to be put in place to promote the use of renewable electricity there is less consensus as to what are the best kinds of strategies to use what is attracting increasing attention in canada is a system of renewable portfolio standards in this all power suppliers are under an obligation to ensure that a certain percentage of the electricity they generate is from renewable resources they can either generate that electricity themselves or purchase green certificates from those who have used renewables to generate electricity recent experience from europe however suggests that a whole hearted commitment to this single strategy could be premature and potentially damaging for the development of all kinds of renewable electricity in canada solar photovoltaics included on the other side of the atlantic ocean the use of so called feed in tariffs that is an obligation for utilities to purchase at a set price the electricity generated by any renewable energy resource is widely credited with accelerating the development of renewable electricity in many countries the purpose of this article is to reflect upon this european experience with feed in tariffs to stimulate discussions regarding what promise they might hold for the development of solar photovoltaic electricity in canada the article is divided into three main sections in the first section policies to promote renewable electricity presently in place in different parts of canada are reviewed attention is then focused more specifically in the second section of this article upon feed in tariffs after defining and describing this alternative system experiences in the countries of the european union are reviewed the main strengths and weaknesses of feed in tariffs in the european experience are also examined the focus then moves back to canada in the third section of the article in this a system of feed in tariffs is proposed for the province of ontario in order to provide just one example of the kind of support that could be forthcoming

the impact of off balance sheet activities on banks returns an application of the arch m to canadian data abstract this paper revisits the impact of off balance sheet obs activities on banks risk return trade off recent studies e g stiroh and rumble 2006 show that increasing obs activities does not necessarily yield straightforward diversification benefits for banks however introducing a risk premium in the standard banks returns models and resorting to an arch m procedure canadian data suggest that banks risk return trade off displays a structural break around 1997 in the second subperiod of our sample 1997 2007 we find that the noninterest income generated by obs activities no longer impacts banks returns negatively while during the first period 1988 1996 the volatility variable is not significant in any returns equations a risk premium eventually emerges pricing the risk associated to obs activities

systemic risk and bank business models textabstractin this paper we decompose banks systemic risk into two dimensions the risk of a bank bank tail risk and the link of the bank to the system in financial distress systemic linkage based on extreme value theory we estimate a systemic risk measure that can be decomposed into two subcomponents reflecting these dimensions empirically we assess the relationships of bank business models to the two dimensions of systemic risk the observed differences in these relationships partly explain why micro and macroprudential perspectives sometimes have different implications for banking regulation

bank capital and liquidity creation in asia pacific we calculate liquidity creation for a large sample of commercial banks in 14 asia pacific economies from 2005 to 2012 we find that banks in this region created 7 83 trillion in liquidity in 2012 or approximately 3 24 times the total liquidity created in 2005 large banks and those based in developing asia created the highest liquidity we also investigate the bicausal relationship between liquidity creation and regulatory capital and find that the trade off between the benefits of financial stability induced by enhanced capital requirements and those of higher liquidity creation is applicable to all of the sample banks regardless of bank size and economic region

bank competition and financial stability much ado about nothing the theoretical literature gives conflicting predictions on how bank competition should affect financial stability and dozens of researchers have attempted to evaluate the relationship empirically we collect 598 estimates of the competition stability nexus reported in 31 studies and analyze the literature using meta analysis methods we control for 35 aspects of study design and employ bayesian model averaging to tackle the resulting model uncertainty our findings suggest that the definition of financial stability and bank competition used by researchers influences their results in a systematic way the choice of data estimation methodology and control variables also affects the reported coefficient we find evidence for moderate publication bias taken together the estimates reported in the literature suggest little interplay between competition and stability even when corrected for publication bias and potential misspecifications this abstract was borrowed from another version of this item

lessons learned in france and quebec regarding financial and legal mechanisms to develop renewable energy a hybrid model as an acceptable solution for onshore wind abstract this article shows that the unfavorable context of emergence as well as neo corporatism limited the weight of wind energy in france and quebec and delayed the project development and the wind industry as a whole indeed the level of political will to wind energy development in both jurisdictions is fluctuating and characterized by a lack of continuity in policy or regulatory instruments the efficiency of the pricing mechanisms depends on its political design while the french feed in tariff is inefficient in terms of installed capacity and is deemed too expensive by opponents the first two calls for tenders in quebec fare quite well on that front however they are perceived as unacceptable due to the multinational companies involved and the implantation of large scale wind farms in inhabited areas the third community call for tender while generally better accepted locally is poorly regarded among the cooperative movement and at the national level because of the competition with the municipal sector and higher costs to society in both cases a hybrid pricing model would achieve a better balance between costs to society and local development thus promoting social acceptance through a greater diversity in ownership types and wind farms size

does collateral fuel moral hazard in banking this paper presents two models in which the fluctuating value of loan collateral real estate generates the problem of moral hazard between a bank and a deposit insurance agent the bank finances risky projects against collateral and relies on the rising collateral value if the collateral value later appreciates the bank enjoys handsome profits otherwise the bank fails the findings are rather consistent with the characteristics of the topical subprime mortgage crisis

policies and market factors driving wind power development in the united states abstract in the united states there has been substantial recent growth in wind energy generating capacity with growth averaging 24 percent annually during the past five years about 1700 mw of wind energy capacity was installed in 2001 while another 410 mw became operational in 2002 during 2003 development activity has remained strong with an estimated 1600 mw of capacity installed with this growth an increasing number of states are experiencing investment in wind energy projects currently about half of all states host at least one wind power project this paper explores the key factors at play in the 12 states in which a substantial amount of wind energy capacity has been developed or planned some of the factors that are examined include policy drivers such as renewable portfolio standards rps federal and state financial incentives as well as market drivers such as consumer demand for green power natural gas price volatility and wholesale market rules

economic value competition and financial distress in the european banking system abstract in this paper we examine the impact of a large number of factors at the bank level liquidity and credit risks asset size income diversification and market power at the industry level banking concentration and macro level real gdp growth on bank financial distress using an unbalanced panel of 308 european commercial banks between 1996 and 2009 the observations falling below a given threshold of the empirical distribution of the shareholder value ratio proxy bank financial distress we employ a panel probit regression and given the presence of overlapping data giving rise to residual autocorrelation we use the bertschek and lechner 1998 robust estimator of the covariance matrix of parameters we show that credit risk liquidity risk and bank market power are the most influential determinants of distressed shareholder value ratio finally we evaluate the model out sample forecasting performance over the 2008 2009 crisis period

short term generation asset valuation a real options approach this paper discusses using real options to value power plants with unit commitment constraints over a short term period we formulate the problem as a multistage stochastic problem and propose a solution procedure that integrates forward moving monte carlo simulation with backward moving dynamic programming we assume that the power plant operator maximizes expected profit by deciding in each hour whether or not to run the unit that a certain lead time for commitment and decommitment decisions is necessary to start up and shut down a unit and that these commitment decisions once made are subject to physical constraints such as minimum uptime and downtime we also account for the costs associated with starting up and shutting down a unit last we assume that there are hourly markets for both electricity and the fuel used by the generator and that their prices follow ito processes using numerical simulation we show that failure to consider physical constraints may significantly overvalue a power plant

determinants of bank cost efficiency in transition economies evidence for latin america central and eastern europe and south east asia in this study we adopt wang s 2002 heteroscedastic stochastic frontier model which allows us to investigate bank cost efficiency and to measure the marginal effects of some variables on both the level and the variability of inefficiency in recent years the financial crisis has significantly affected the banking systems of the transition countries hence the efficiency is of major importance for the stability of the banks regarding the determinants of efficiency we find evidence that banks that follow a more cautious strategy characterized by lower risk appetite and average expectations on profitability have higher cost efficiency we also find that traditional deposit taking and loan making still remain the most efficient activity of the banks additionally the results showed that a higher gross domestic product growth rate implies an increase in the inefficiency level indicating an unsustainable bank management behaviour which in periods of economic growth adopts policies that can generate

green energy market development in germany effective public policy and emerging customer demand this paper reviews the development of renewable energy in germany from 1973 to 2003 it investigates the relative importance of energy policy and green power marketing in shaping the renewable energy market more than a decade of consistent policy support for renewables under the feed in law streg and its successor eeg has been an important driver for increasing renewable electricity generation to date putting the country in a better position than most of its peers when it comes to achieving european union targets for renewable energy green power marketing driven by customer demand on the other hand is growing but has had limited measurable impact so far we discuss potential intangible benefits of green power marketing and scenarios for future market development the paper concludes with lessons that can be learned from the german case for policy design and market development in other countries

the impact of underwriting and dealing on bank returns and risks abstract this study uses portfolio theory to investigate empirically the potential for diversification gains from expanded bank securities powers diversification potential is examined using microeconomic data on returns to existing bank securities and non securities activities over 1976 through 1985 both the mean and standard deviation of returns to securities activities are found to be greater than those of non securities activities some potential for diversification gains is found although this appears to be quite limited experiments designed to estimate the effect of using industry and time aggregated data are performed

renewable energy costs potentials barriers conceptual issues renewable energy can become the major energy supply option in low carbon energy economies disruptive transformations in all energy systems are necessary for tapping widely available renewable energy resources organizing the energy transition from non sustainable to renewable energy is often described as the major challenge of the first half of the 21st century technological innovation the economy costs and prices and policies have to be aligned to achieve full renewable energy potentials and barriers impeding that growth need to be removed these issues are also covered by ipcc s special report on renewable energy and climate change to be completed in 2010 this article focuses on the interrelations among the drivers it clarifies definitions of costs and prices and of barriers after reviewing how the third and fourth assessment reports of ipcc cover mitigation potentials and commenting on definitions of renewable energy potentials in the literature we propose a consistent set of potentials of renewable energy supplies

simple banking profitability and the yield curve how does bank profitability vary with interest rates we present a model of a monopolistically competitive bank subject to repricing frictions and test the model s predictions using a unique panel data set on uk banks we find evidence that large banks retain a residual exposure to interest rates even after accounting for hedging activity operating through the trading book in the long run both level and slope of the yield curve contribute positively to profitability in the short run however increases in market rates compress interest margins consistent with the presence of nonnegligible loan pricing frictions

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

the risk of financial intermediaries this paper reconsiders the formal estimation of bank risk using the variability of the profit function in our model point estimates of the variability of profits are derived from a model where this variability is endogenous to other bank characteristics such as capital and liquidity we estimate the new model on the entire panel of us banks spanning the period 1985q1 2012q4 the findings show that bank risk was fairly stable up to 2001 and accelerated quickly thereafter up to 2007 we also establish that the risk of the relatively large banks and banks that failed in the subprime crisis is higher than the industry s average thus we provide a new leading indicator which is able to forecast future solvency problems of banks

alternatives to coal and candles wind power in china china is in a unique position to be able to exploit her vast wind resources to satisfy both the rapidly growing energy demand which fuels her economy as well as needs of approximately 72 million people who live in rural areas and have no access to conventional electricity services china mainly through the e orts of the inner mongolia autonomous region has already successfully disseminated over 150 000 small scale wind electric generators which power households in rural areas through a well coordinated combination of local research and development technology transfer industry support end user incentives and an infrastructure for information dissemination and technical training in this paper we review china s utilization of wind energy and discuss how it can be increased for both rural electri cation and the rapidly growing power sector we nd that novel approaches in technical implementation of wind power use may help to better meet china s needs use of hybrid systems may help to provide higher quality more reliable power for rural households and villages than is currently provided through wind only systems grid connected wind power which currently is more costly and less reliable than coal power can become cost competitive and more reliable through local mass production of wind turbines combined with storage systems we examine governmental support through policy infrastructure development and nancial incentives that have fostered the successes of dissemination of small scale wind turbines and also the support or lack thereof that has hindered commercial development of large scale wind power we nd that a better policy and regulatory framework is the most important measure that china can take to increase the use of this indigenous clean resource 2000 elsevier science ltd all rights reserved

market power in cee banking sectors and the impact of the global financial crisis the aim of this study is to undertake an up to date assessment of market power in central and eastern european banking markets and explore how the global financial crisis has affected market power and what has been the impact of foreign ownership three main results emerge first while there is some convergence in country level market power during the pre crisis period the onset of the global crisis has put an end to this process second bank level market power appears to vary significantly with respect to ownership characteristics third asset quality and capitalization affect differently the margins in the pre crisis and the crisis periods while in the pre crisis period the impacts are similar for all banks regardless of ownership status in the crisis period non performing loans have a negative effect and capitalization a positive effect only for domestically owned banks

local versus international crises and bank stability does bank foreign expansion make a difference abstractwe investigate the impact of global and local crises on bank stability in the mena region and examine the effect of owning bank subsidiaries in other countries we consider banks that experienced both types of crises during our sample period our findings highlight a negative impact of the global financial crisis of 2007 2008 on bank stability but on the whole no negative impact of the local crisis a deeper investigation shows that owning bank subsidiaries outside the home country is a source of increased fragility during normal times yet a source of higher stability during the local crisis but not during the international crisis moreover owning foreign subsidiaries in one or two world regions is insufficient to neutralize both types of crises while being present in three or more regions is more stabilizing during a local crisis but also more destabilizing during an international crisis our findings contribute to the literature examining bank stability and have several policy implications

bank competition and financial stability in asia pacific the impact of bank competition on financial stability has been a focus of academic and policy debate over the last two decades and particularly since the 2007 08 global financial crises beck 2008 oecd 2011 under the traditional competition fragility view banks cannot earn monopoly rents in competitive markets and this results in lower profits capital ratios and charter values this makes banks less able to withstand demand or supply side shocks and encourages excessive risk taking marcus 1984 alternatively the competition stability view suggests that competition leads to greater stability a less competitive banking market may lead to more risk taking if the big banks are deemed too important to fail and as such obtain implicit or explicit subsidies via government safety nets mishkin 1999 in addition banks with more market power tend to charge higher loan rates which may induce borrowers to assume greater risk leading to greater default in competitive banking markets loan rates are lower too big to fail issues and safety net subsidies are smaller and this results in a positive link between bank competition and stability boyd and de nicolo 2005 it could also be the case as noted by martinez miera and repullo 2010 that bank competition and stability are linked in a non linear manner and in a similar vein berger et al 2009 argue that competition and concentration may coexist and can simultaneously induce stability or fragility

bank income structure and risk an empirical analysis of european banks the purpose of this paper is to investigate the relationship between bank risk and product diversification in the changing structure of the european banking industry based on a broad set of european banks for the period 1996 2002 our study first shows that banks expanding into non interest income activities present higher risk and higher insolvency risk than banks which mainly supply loans however considering size effects and splitting non interest activities into both trading activities and commission and fee activities we show that the positive link with risk is mostly accurate for small banks and essentially driven by commission and fee activities a higher share of trading activities is never associated with higher risk and for small banks it implies in some cases lower asset and default risks

planning siting and the local acceptance of wind power some lessons from the french case abstract after some years of trifling development under a system of public tenders 1995 2000 french politicians progressively changed the national policy framework for feed in tariffs december 2000 and wind power development zones july 2005 the new policy framework has triggered a beginning of takeoff in wind power capacity the paper examines french wind power development in the light of two key dimensions and concepts related to wind power policy planning and siting part 1 we particularly focus on the recent french legislative debate which led to the adoption of the new policy framework part 2 the french case shows that the recourse to planning tools was not tailor made for siting issues but resulted from a political fight over the decentralization of energy policy the policy outcome which we call flexible decentralized planning is both interesting and ambiguous it is interesting in that it develops interfaces between planning tools and siting institutions it is ambiguous in that it is potentially very hierarchical the final decision power is left in state planners hands making it unpredictable the extent to which room will genuinely be provided for siting processes to take place

short term safety or long term failure empirical evidence of the impact of securitization on bank risk based on a sample of u s commercial banks from 2002 to 2012 this paper shows that bank loan securitization has a significant and positive impact on both z scores and the likelihood of bank failure indicating a short term risk reduction and a long term risk increase effect we also find disparate impacts between mortgage and non mortgage securitization loan sale activities are found to have a similar impact to securitization

what precludes the development of noninterest activities in chinese commercial banks from the perspective of the price of interest activities noninterest activities of chinese commercial banks remain sluggish this article examines the price of interest activities and noninterest activities of chinese commercial banks over 2000 2010 based on ols and 2sls regression we find that the price of interest activities has a significant negative effect on the noninterest activities it appears that controlled interest rate is the main hindrance of the development of noninterest activities and the result is consistent with political view we also find that among state owned commercial banks and nonstate owned ones the relationships of interest activities and noninterest activities are differential the link between the price of interest activities and noninterest activities in state owned commercial banks is stronger than that in nonstate owned commercial banks that is the result of different government intervention degree

how loan portfolio diversification affects risk efficiency and capitalization a managerial behavior model for austrian banks abstract the aim of this paper is to analyze how diversification of banks across size and industry affects risk cost and profit efficiency and bank capitalization for large austrian commercial banks over the years 1997 2003 employing a unique dataset provided by the austrian central bank we test for several different types of managerial hypotheses formalized according to a modified version of the berger and deyoung model berger a n deyoung r 1997 problem loans and cost efficiency in commercial banks journal of banking and finance 21 849 870 we find that although diversification negatively affects cost efficiency it increases profit efficiency and reduces banks realized risk finally diversification seems to have a positive impact on banks capitalization

deregulation technological change and the business lending performance of large and small banks according to deyoung et al journal of financial services research 2004 deregulation and technological change has divided the us banking industryinto two primarysize based groups verylarge banks specializing in the use of hard information to make standardized loans and smaller banks specializing in the use of soft information and relationship development to make non standardized loans we evaluate business lending performance for small and large banks over the 1993 2001 period small business lending bysmall banks is characterized byrelationship development and non standardized loans consistent with deyoung et al s model we find that after controlling for market concentration cost of funds and a variety of other factors that might influence yields smaller banks perform better than larger banks in the small business lending market however larger banks appear to have the advantage in credit card lending a market characterized byimpersonal relationships and standardized loans interestingly we find evidence that larger banks have been making inroads in the market for the smallest business loans a result consistent with the use of credit scoring bylarge banks to make

expected willingness to pay for wind energy in atlantic canada abstract we investigate the demand side of wind energy in three provinces in atlantic canada including new brunswick nova scotia and prince edward island empirical questions addressed include i what are the determinants of the probability of paying a non zero premium for electricity generated using wind technology ii given participation what drives how much more households are willing to pay a month and what is the monthly premium or expected willingness to pay wtp and iii is there heterogeneity in the expected wtp the study design follows the contingent valuation framework and the survey questionnaire follows a payment scale format reducing the starting point bias and reduces the incidence of item non response the data is from a stratified random sample we employ two stage models cragg s hurdle and the two part econometric models in the analysis scope and 0 wtp effects are explicitly explored we find that the overall probability of participation is 0 73 university education income residential property ownership concerns about the presence of wind turbines in neighborhoods and externality affect the likelihood of participation households are willing to pay 14 more per month in energy bill for wind power there is evidence of scope sensitivity the results provide insights on what proportion of the population will participate and how much more they are willing to pay for wind energy

fostering a renewable energy technology industry an international comparison of wind industry policy support mechanisms this article examines the importance of national and sub national policies in supporting the development of successful global wind turbine manufacturing companies we explore the motivations behind establishing a local wind power industry and the paths that different countries have taken to develop indigenous large wind turbine manufacturing industries within their borders this is done through a cross country comparison of the policy support mechanisms that have been employed to directly and indirectly promote wind technology manufacturing in 12 countries we find that in many instances there is a clear relationship between a manufacturer s success in its home country market and its eventual success in the global wind power market whether new wind turbine manufacturing entrants are able to succeed will likely depend in part on the utilization of their turbines in their own domestic market which in turn will be influenced by the annual size and stability of that market consequently policies that support a sizable stable market for wind power in conjunction with policies that specifically provide incentives for wind power technology to be manufactured locally are most likely to result in the establishment of an internationally competitive wind industry

the relationship between net interest margin and noninterest income using a system estimation approach abstract this paper examines the determinants of bank net interest margin nim and non traditional banking activities nii a system estimation approach is employed to control for the simultaneity between nim and nii for commercial banks in a group of 28 financially liberalized countries during the period between 1997 and 2004 we find a statistically significant negative relationship between nim and nii for the period between 1997 and 2002 a generally positive but statistically insignificant association between nim and nii is found for the subsequent period 2003 2004 banks increasing involvement in non traditional activities is negatively correlated with risk adjusted profitability measures in the former subperiod suggesting no obvious diversification benefits however the share of noninterest income is positively related to the return on assets roa and the return on equity roe for the latter subsample

bank systemic risk and macroeconomic shocks canadian and u s evidence abstract this paper investigates how banks as a group react to macroeconomic risk and uncertainty more specifically it examines the relationship between bank systemic risk and changes and disruptions in economic conditions adopting the methodology of beaudry et al 2001 we introduce a new estimation procedure based on egarch to refine the framework developed by baum et al 2002 baum et al 2004 baum et al 2009 and quagliariello 2007 quagliariello 2009 and we analyze the relationship in the current industry context i e in the context of market based banking our results confirm that banks tend to behave more homogeneously vis a vis macroeconomic uncertainty in particular we find that both the cross sectional dispersion of loans to assets and the cross sectional dispersion of non interest income share shrink during slow growth episodes and particularly during financial crises when the resilience of the banking system is at its lowest more importantly our main findings indicate that the cross sectional dispersion of loans to assets has increased in the last decade whereas the cross sectional dispersion of non interest income share appears to be more volatile and sensitive to macroeconomic shocks

shareholder value creation in japanese banking this paper advances the study of fiordelisi and molyneux 2010 by examining the shareholder value efficiency and its determinants for a large sample of japanese banks between 1999 and 2011 a new specifically tailored measure of the economic value added approach based on the shadow price of equity is developed in order to account for specific characteristics of the japanese banking system this new shareholder value measure is then used in a dynamic panel data model as a linear function of various bank risk bank specific and macroeconomic variables this study finds that cost efficiency gains credit risk and bank size are the most important factors in explaining the shareholder value creation in japanese banking cost efficiency changes are also found to significantly influence cost of equity capital

the impact of bank capital on profitability and risk in asian banking abstract this article applies the generalized method of moments technique for dynamic panels using bank level data for 42 asian countries over the period 1994 to 2008 to investigate the impacts of bank capital on profitability and risk ignoring influence factors the extant literature presents an ambiguous impact of bank capital on profitability risk however when the effects from the influencing factors are taken into consideration three conclusions are reached first along with the change in the categories of banks investment banks have the lowest and positive capital effect on profitability whereas commercial banks reveal the highest reverse capital effect on risk second banks in low income countries have a higher capital effect on profitability banks in lower middle income countries have the highest reverse capital effect on risk while banks in high income countries have the lowest values third banks in middle eastern countries own the highest and positive capital effect on profitability far east central asian banks have the largest reverse capital effect on risk while the lowest value occurs in middle eastern countries banks finally our results also reveal that persistence of profit is greatly affected by different profitability variables and all risk variables show persistence from one year to the next

the real options to shutdown startup and abandon u s electricity industry evidence abstract the purpose of this paper is to examine empirically the partially irreversible decisions to shutdown startup and abandon existing production assets under cash flow uncertainty and regulatory uncertainty we use detailed information for 1121 individual electric power generators located in the u s for the period 2001 2009 and find strong evidence of real options effects we find that both profitability uncertainty and regulatory uncertainty decrease the probability of shutdown regulatory uncertainty also decreases the probability of startup but we find that cash flow uncertainty increases the probability of startup especially for large generators