bluuebunny/crossref_metadata_2025 huggingface dataset:
Retail Gasoline Price Cycles: Evidence from Guelph, Ontario Using Bi-Hourly, Station-Specific Retail Price Data
Authors: Atkinson Benjamin
Published: May 2011

This paper uses prices that were directly observed at 27 gasoline stations in Guelph, Ontario, eight times per day for 103 days in late-2005, to examine several basic predictions of a theory of price cycles. It is found that price movements in Guelph are more consistent with the Edgeworth cycle theory than with other dynamic pricing theories. The data also identify some interesting (and somewhat systematic) pricing patterns that have not been identified in previous studies, and which would likely be overlooked with less complete data. These findings are not only of interest to applied economists and policymakers, but also to theoreticians who are interested in refining the theory to make more accurate predictions.
Hicks, Hayek, Hotelling, Hubbert, and Hysteria or Energy, Exhaustion, Environmentalism, and Etatism in the 21st Century
Authors: Gordon Richard L.
Published: May 2011

In 2008, energy independence is making an unwelcome return in a greatly expanded form. The old import-danger excuse is supplemented by claims that exhaustion and global warming also will be cured. The import danger threat remains overblown. Exhaustion is not an impending problem and, if it were, it has no policy implications for anything including for imports. Similarly, whatever is true about global warming, it does not imply import controls.
The Willingness to Pay for Renewable Energy Sources: The Case of Italy with Socio-demographic Determinants
Authors: Bollino Carlo Andrea
Published: May 2011

According to the “Renewable Sources” EU Directive 2001/77/CE, the Italian Government goal is to attain the share of 22% in RES electricity production in 2010. In such context it becomes crucial to explore the existence of consumer’s Willingness to Pay (WTP) in order to use renewable energy in the electricity production. This study is based on a national survey with 1601 interviews made, in Italy, in November 2006. My aim is twofold. Firstly, I wish to assess the consumer’s WTP which is the basis for market sustainability of such energy policy goal and, secondly, I evaluate the share of the necessary public support to RES policy which is covered by the aggregate WTP of Italians. This is an implicit assessment of the plausibility/acceptance of the announced target policy. In my survey framework I obtain the consumer’s WTP with two different approaches and to this end the sample has been divided in two parts. In the first sub-sample I propose the full price vector with a downward elicitation format while in the second sub-sample I use the same price vector with an upward elicitation format. In this paper I focus on the different uncertainty degree that affects respondent’s choices. I take care econometrically of this issue using an individual stochastic valuation approach and a referendum approach. I obtain for most of the estimated models that estimates of WTP are in agreement with other international results. The aggregate WTP for RES in Italy, however, is (still) not enough to attain the Italian Government goal in 2010.
Willingness to Pay for Improved Quality of Electricity Supply Across Business Type and Location
Authors: Morrison Mark , Nalder Craig
Published: May 2011

Regulatory authorities in many countries are experimenting with mechanisms for providing electricity distributors with financial incentives to improve quality of supply. In designing these incentives it is apparent that customers’ preferences have rarely been obtained for consideration in the regulatory process. As a result, there is relatively limited understanding of customers’ willingness to pay for improved quality of electricity supply. Several studies have examined the willingness of households to pay for improved quality of electricity supply, however, few studies have examined the willingness of businesses to pay for improved quality of supply. In this study we use choice modelling with random parameters logit models to identify the willingness to pay of business for various service related attributes. Furthermore, we examine the values held by both service and manufacturing businesses, from both rural/regional and urban areas, and observe the differences between them. We find several differences in willingness to pay across business types and locations, however overall the value estimates are relatively homogeneous.
Understanding Crude Oil Prices
Authors: Hamilton James D.
Published: May 2011

This paper examines the factors responsible for changes in crude oil prices. The paper reviews the statistical behavior of oil prices, relates this to the predictions of theory, and looks in detail at key features of petroleum demand and supply. Topics discussed include the role of commodity speculation, OPEC, and resource depletion. The paper concludes that although scarcity rent made a negligible contribution to the price of oil in 1997, it could now begin to play a role.
Natural Gas Pricing in Countries of the Middle East and North Africa
Authors: Razavi Hossein
Published: May 2011

This paper presents a quantitative framework for discussing the gas pricing policy in the countries of Middle East and North Africa (MENA) where gas prices are set directly or indirectly by the governments. It concludes that the price of gas in most MENA countries is substantially below its economic cost, resulting in wasteful use of gas and electricity, deployment of inefficient technologies, and huge burden on government budgets. The low gas price also causes a bias in favor of gas export projects while at the same time reduces investors’ interest in the upstream and downstream gas sector. The implications are most interesting about four countries - Algeria, Qatar, Egypt and Iran - where each country has to revisit its gas allocation policy and where each government is trying to de-link investors’ interest from domestic gas prices.
Price Convergence in Natural Gas Markets: City-Gate and Residential Prices
Authors: Arano Kathleen , Velikova Marieta
Published: May 2011

It has been argued that the restructuring of the natural gas industry have lead to a successful deregulation. Evidence from previous studies has shown that the unbundling of gas services and the requirement of open access have made prices from various segments in the industry more cointegrated. Our results indicate that even the smallest volume natural gas customers—residential consumers have felt the benefits of the industry restructuring. 90 percent of the 50 state level city gate and residential natural gas pairs that we examined showed evidence of cointegration. Further investigation reveals that the price series for more states were cointegrated in the post 1992 period after FERC 636 (the ‘final restructuring rule’) was implemented and when retail unbundling started.
Interregional Sharing of Energy Conservation Targets in China: Efficiency and Equity
Authors: Wei Dan , Rose Adam
Published: May 2011

Energy conservation is a long-term strategic policy in China to support its economic and social development. This strategy is important for saving resources, protecting the environment, and ensuring a secure supply of energy. However, energy conservation often involves large amounts of investment and may also have dampening impacts on some local and regional economies. Moreover, energy conservation has many features of a public good. Therefore, government policy will have to play a strong role to foster local efforts and interregional cooperation on this issue. This paper analyzes a promising policy instrument - an interregional energy conservation-quota trading system. An operational model is developed to simulate the workings of this policy instrument for a variety of quota allocations among regions. The results indicate that a tradable quota system can help China achieve its conservation target in a cost-effective way and in accordance with its regional development strategy.
Green Accounting for Black Gold
Authors: Cairns Robert D.
Published: May 2011

In the petroleum industry, valid green economic accounting magnitudes are influenced by natural and other constraints on production, by non-convexity of technology and by non-optimality of output. The paper undertakes an economic analysis of oil extraction that explicitly represents the conditions and constraints that influence the decisions of a firm. This microeconomic analysis diverges from conventional, “Hotelling” macroeconomic models of nonrenewable-resource extraction and has substantially different findings. Optimality conditions such as Hotelling’s rule or first-order conditions are not utilized in defining accounting statistics. Contrary to the findings of many studies, it is found that traditional (non-green) accounting practice for commercial natural resources such as petroleum sensibly balances the aims of economic accounting. Instead, adjustments to practice are most needed for non-commercial values such as pollution or amenities.
European Natural Gas Markets: Resource Constraints and Market Power
Authors: Zwart Gijsbert T.J.
Published: May 2011

The European natural gas market is characterized by declining indigenous resources, particularly in the UK and the Netherlands, and a growing dependence on a small number of large exporters who, as a consequence, see their market power increasing.

In this paper we analyze long-run scenarios for the European natural gas markets in a model, NATGAS, that explicitly includes both factors, resource constraints and producers’ market power. Finite resources lead to interdependencies of current production decisions and future opportunities. These decisions in turn depend on the potential for large producers to set market prices above marginal costs.

We analyze the impact of conditions on the global LNG market on market shares of pipeline gas suppliers, as well as on the speed of depletion of indigenous European resources. We focus on how shadow prices of resource constraints affect substitution patterns in the various scenarios.
An Integrated Approach to Simulate the Impacts of Carbon Emissions Trading Schemes
Authors: Labandeira Xavier , Linares Pedro , Rodriguez Miguel
Published: May 2011

The present paper aims to reliably depict the impact of the European Union Emissions Trading Scheme (EUETS) on Spain under different assumptions about the industries involved. Prior analyses, based either on highly aggregated macroeconomic or specific electricity industry models, have been limited in degree of detail or scope. Two types of modeling were combined in the present study: general equilibrium was used to assess the impact on different industries and to explain cross-industry changes, and partial equilibrium to suitably model the complex and crucial electricity system. Combining and interrelating these two models yields the effects on price, carbon dioxide (CO2) emissions and distributional patterns in Spain of both the current policy and of an alternative in which all industries take part in the EU ETS. Since Spain is a key participant in this scheme, the conclusions and policy implications stemming from this paper are relevant to and useful for post-Kyoto arrangements.
Renewable Portfolio Standards: When Do They Lower Energy Prices?
Authors: Fischer Carolyn
Published: May 2011

Some studies of renewable portfolio standards find that regulations increase electricity generation costs; others find that the reduced demand for nonrenewable energy sources lowers natural gas prices and that electricity prices follow. This paper presents reasons for why these predictions can vary in the direction as well as the magnitude of their effects. The two driving factors are the elasticity of electricity supply from renewable energy sources relative to nonrenewable ones and the effective stringency of the target. The availability of other baseload generation helps to determine that stringency, and demand elasticity influences only the magnitude of the price effects, not the direction of those effects. The paper also evaluates circumstances under which higher standards can decrease both certificate prices and renewable energy supply. Sensitivity analysis indicates that assumptions about renewable energy supply slopes are more important than those about nonrenewable supplies in predicting the retail price impacts of renewable portfolio standards.
Energy Substitutability in Canadian Manufacturing Econometric Estimation with Bootstrap Confidence Intervals
Authors: Dissou Yazid , Ghazal Reza
Published: May 2011

This study provides estimates of the price and Morishima substitution elasticities between energy and non-energy inputs in two Canadian energyintensive manufacturing industries: Primary Metal and Cement. The elasticities are estimated using annual industry-level KLEM data (1961-2003) and relying on two flexible functional forms: the Translog and the Symmetric Generalized McFadden (SGM) cost functions. In addition to the point estimates, the confidence intervals of the elasticities are computed using Studentized bootstrap resampling techniques. For both industries, the estimation results suggest that capital, labour, material and energy are pairwise substitutes and that energy is the most substitutable input. However, the low magnitudes of the estimated elasticities do not seem to offer great flexibility to these industries to adapt to high increases in energy prices.
The Impact of Oil Price Shocks on the Economic Growth of Selected MENA1 Countries
Authors: Berument M. Hakan , Ceylan Nildag Basak , Dogan Nukhet
Published: May 2011

This paper examines how oil price shocks affect the output growth of selected MENA countries that are considered either net exporters or net importers of this commodity, but are too small to affect oil prices. That an individual country’s economic performance does not affect world oil prices is imposed on the Vector Autoregressive setting as an identifying restriction. The estimates suggest that oil price increases have a statistically significant and positive effect on the outputs of Algeria, Iran, Iraq, Kuwait, Libya, Oman, Qatar, Syria, and the United Arab Emirates. However, oil price shocks do not appear to have a statistically significant effect on the outputs of Bahrain, Djibouti, Egypt, Israel, Jordan, Morocco, and Tunisia. When we further decompose positive oil shocks such as oil demand and oil supply for the latter set of countries, oil supply shocks are associated with lower output growth but the effect of oil demand shocks on output remain positive.
Resource Nationalism - Limits to Foreign Direct Investment
Authors: Kretzschmar Gavin L. , Kirchner Axel , Sharifzyanova Liliya
Published: May 2011

Despite a global trend toward the privatization of state assets, host governments are consolidating ownership over strategically important domestic oil and gas resources, effectively limiting corporate foreign direct investment. These findings are supported by an analysis of global reserve acquisitions for the period 2000-2006, a period which saw listed national oil companies (NOCs) acquire over 82% of their reserves domestically, compared to only 25% for commercial operators.

We also perform a regression analysis and find that political risk and reserve size are strongly related to state ownership retention, while the degree of state control is positively related to OPEC membership. Foreign direct investment is shown to be increasingly constrained to assets in low-risk developed countries or marginal oilfield assets.
Explaining Fluctuations in Gasoline Prices: A Joint Model of the Global Crude Oil Market and the U.S. Retail Gasoline Market
Authors: Kilian Lutz
Published: May 2011

The distinction between the price of gasoline in the U.S. and the price of crude oil in global markets is often ignored in discussions of the impact of higher energy prices. This article makes explicit the relationship between demand and supply shocks in these two markets. Building on a recently proposed structural VAR model of the global crude oil market, it explores the implications of a joint VAR model of the global market for crude oil and the U.S. market for motor gasoline. It is shown that it is essential to understand the origins of a given gasoline price shock, when assessing the responses of the price of gasoline and of gasoline consumption, since each demand and supply shock is associated with responses of different magnitude, pattern and persistence. The article assesses the overall importance of these shocks in explaining the variation in U.S. gasoline prices and consumption growth, as well as their relative contribution to the evolution of U.S. gasoline prices since 2002.
The Value of Plug-In Hybrid Electric Vehicles as Grid Resources
Authors: Sioshansi Ramteen , Denholm Paul
Published: May 2011

Plug-in hybrid electric vehicles (PHEVs) can become valuable resources for an electric power system by providing vehicle to grid (V2G) services, such as energy storage and ancillary services. We use a unit commitment model of the Texas power system to simulate system operations with different-sized PHEV fleets that do and do not provide V2G services, to estimate the value of those services. We demonstrate that a PHEV fleet can provide benefits to the system, mainly through the provision of ancillary services, reducing the need to reserve conventional generator capacity. Moreover, our analysis shows that PHEV owners are made better off by providing V2G services and we demonstrate that these benefits can reduce the time it takes to recover the higher upfront capital cost of a PHEV when compared to other vehicle types.
A Note on the Oil Price Trend and GARCH Shocks
Authors: Li Jing , Thompson Henry
Published: May 2011

This paper investigates the trend in the monthly real price of oil between 1990 and 2008 with a generalized autoregressive conditional heteroskedasticity (GARCH) model. Trend and volatility are estimated jointly with the maximum likelihood estimation. There is long persistence in the variance of oil price shocks, and a GARCH unit root (GUR) test can potentially yield a significant power gain relative to the augmented Dickey-Fuller (ADF) test. After allowing for nonlinearity, the evidence supports a deterministic trend in the price of oil. The deterministic trend implies that influence of a price shock is transitory and policy efforts to restore a predictable price after a shock would be unwarranted in the long run.
International Economic Interdependency and U.S. National Energy Policy
Authors: Baker Arnold B.
Published: May 2011

This paper briefly reviews some key aspects of U.S. energy policy history and policy-making complexity, considers the issues and pressures that growing international economic interdependency may bring, and suggests some approaches and tools for improvement.
Technology Options for Low Stabilization Pathways with MERGE
Authors: Magné Bertrand , Kypreos Socrates , Turton Hal
Published: May 2011

This paper investigates long-term transitions of the global energy system compatible with realizing low stabilization climate targets, using an enhanced MERGE model. The results indicate that stringent mitigation targets can be met under many technology scenarios, but major technological change is needed, highlighting important roles for R&D and learning-by-doing. The analysis explores the impact of limiting the set of available technology options (to account for technical uncertainties and issues of public acceptance) and identifies important influences on energy system development and economic costs under low stabilization. Biomass availability is seen to have a major influence on the characteristics of the energy system. Carbon capture and storage technologies also prove to be potentially critical for both electricity and fuel synthesis, particularly when combined with biomass to produce net negative emissions. Additionally, the availability of fast breeders provides a competitive zero-emissions option. Energy efficiency and large-scale application of renewables are also critical to realising low stabilization scenarios.
Technological Change and International Trade -Insights from REMIND-R
Authors: Leimbach Marian , Bauer Nico , Baumstark Lavinia , Lüken Michael , Edenhofer Ottmar
Published: May 2011

Within this paper, we explore the technical and economic feasibility of very low stabilization of atmospheric GHG concentration based on the hybrid model REMIND-R. The Fourth Assessment Report of the IPCC and the scientific literature have analyzed some low stabilization scenarios but with as yet little attention being given to the regional distribution of the global mitigation costs. Our study helps to fill this gap. While we examine how technological development and international trade affect mitigation costs, this paper is novel in addressing the interaction between both. Simulation results show for instance that reduced revenues from fossil fuel exports in a low stabilization scenario tend to increase mitigation costs borne by the exporting countries, but this impact varies with the technology options available. Furthermore it turns out that the use of biomass in combination with carbon capturing and sequestration is key in order to achieve ambitious CO2 reduction targets. Regions with high biomass potential can clearly benefit from the implementation of low stabilization scenarios due to advantages on the carbon market. This may even hold if a reduced biomass potential is assumed.
Politics and Economics of Second-Best Regulation of Greenhouse Gases: The Importance of Regulatory Credibility
Authors: Bosetti Valentina , Victor David G.
Published: May 2011

Compared with economically ideal policies, actual limits on global warming gases are likely to be “second-best” in many ways. Most studies focus on “second-best” approaches such as delaying emission controls in developing countries, constraining international emission trading, or regulating gases piecemeal by sector rather than equally across the whole economy. We show that another second-best approach—lacking of regulatory credibility—imposes up to six times the extra costs on the economy when compared with all other “second-best” factors combined. When regulatory rules are not believable then firms and other agents become short-sighted and unable to make optimal investments in research and development as well as long-lived technologies. Although analysts have largely ignored this issue, low credibility is commonplace when governments tackle international problems because international institutions such as treaties are usually weak and fickle. Governments can help solve credibility problems with strategies such as “pre-committing” regulations into domestic law that is usually more credible than international commitments. We show that China, for example, can justify unilateral, emission controls because such pre-commitment would encourage Chinese firms to invest with a clearer eye to the future.
The Impact of Climate Change on Nuclear Power Supply
Authors: Linnerud Kristin , Mideksa Torben K. , Eskeland Gunnar S.
Published: May 2011

A warmer climate may result in lower thermal efficiency and reduced load—including shutdowns—in thermal power plants. Focusing on nuclear power plants, we use different European datasets and econometric strategies to identify these two supply-side effects. We find that a rise in temperature of 1°C reduces the supply of nuclear power by about 0.5% through its effect on thermal efficiency; during droughts and heat waves, the production loss may exceed 2.0% per degree Celsius because power plant cooling systems are constrained by physical laws, regulations and access to cooling water. As climate changes, one must consider measures to protect against and/or to adapt to these impacts.
Energy Consumption and Real Income: A Panel Cointegration Multi-country Study
Authors: Joyeux Roselyne , Ripple Ronald D.
Published: May 2011

The direction of the causality between energy consumption and income is an important issue in the fields of energy economics, economic growth, and policies toward energy use. The seminal work on the relations between energy consumption and aggregate income is Kraft and Kraft (1978). An extensive literature has followed, but the array of findings provide anything but consensus on either the existence of relations or direction of causality between the variables. The work in this paper extends this research by analysing the cointegrating and causal relations between income and three energy consumption series based on panel data and the latest panel methodologies. These relations are analysed for the 30 OECD countries and 26 non-OECD countries. The results support a finding of causality flowing from income to energy consumption for developed and developing economies, alike.
A Meta-Analysis of the Economic Impacts of Climate Change Policy in the United States
Authors: Rose Adam , Dormady Noah
Published: May 2011

This paper provides a meta-analysis of a broad set of recent studies of the economic impacts of climate change mitigation policies. It evaluates the influences of the impacts of causal factors, key economic assumptions and macroeconomic linkages on the outcome of these studies. A quantile regression analysis is also performed on the meta sample, to evaluate the robustness of those key factors throughout the full range of macro findings. Results of these analyses suggest that study results are strongly driven by data inputs, economic assumptions and modeling approaches. However, they are sometimes affected in counterintuitive ways.
Do Speculators Drive Crude Oil Futures Prices?
Authors: Büyükşahin Bahattin , Harris Jeffrey H.
Published: May 2011

The coincident rise in crude oil prices and increased number of financial participants in the crude oil futures market from 2000-2008 has led to allegations that “speculators” drive crude oil prices. As crude oil futures peaked at $147/bbl in July 2008, the role of speculators came under heated debate. In this paper, we employ unique data from the U.S. Commodity Futures Trading Commission (CFTC) to test the relation between crude oil prices and the trading positions of various types of traders in the crude oil futures market. We employ Granger Causality tests to analyze lead and lag relations between price and position data at daily and multiple day intervals. We find little evidence that hedge funds and other non-commercial (speculator) position changes Granger-cause price changes; the results instead suggest that price changes precede their position changes.
The Economics of Gas Utilization in a Gas-Rich, Oil-Poor Country: The Case of Bangladesh
Authors: Schramm Gunter
Published: May 2011

It has become an article of faith that clean-burning, low-polluting natural gas is a premium fuel and that on a net heat basis it is inherently more valuable than its closest competitor, fuel oil. This conclusion has been drawn by comparing pollution characteristics of both fuels. While the conclusion is correct, it is correct only in regions that have free access to both natural gas and oil delivered to the user's premises at similar costs per Btu.
The Future of OPEC: Price level and Cartel Stability
Authors: Duly George , Griffin James M. , Steele Henry B.
Published: May 2011

In the wake of events associated with the Iranian revolution, the world price of oil increased from $15 to $32 per barrel. The Energy Modeling Forum's recent review of 10 world oil models shows virtual unanimity in holding that this price increase will be permanent and, indeed, that the real price of oil will increase in the future. The purpose of this paper is to seriously question the assumptions underlying such long-run projections-and hence the projections themselves. We conclude that the 1978-79 price hikes may prove to be a watershed event that effects fundamental changes in the long-run supply and demand for oil.
The Supply, Demand, and Average Price of Natural Gas under Free-Market Conditions
Authors: Wilkinson Jack W.
Published: May 2011

Editor's note: The following paper is of particular interest because the model it summarizes is based an a market equilibration process that generates gas prices differently than the models discussed in our special issue on gas deregulation (October 1982). It should be pointed out that while this paper was reviewed by a panel of expert readers, it has not undergone the anonymous refereeing process that is standard for scholarly papers published in The Energy Journal.
Nuclear Power: Epilogue or Prologue?
Authors: Denton Harold R.
Published: May 2011

Judging by the continuing stream of nuclear power plant cancellations and downward revisions of nuclear energy forecasts, there is nothing riskier than predicting the future of commercial nuclear power. U.S. Nuclear Regulation Commissioner John Ahearne (1981) likens the recent events affecting the nuclear power industry in the United States to a Greek tragedy. Others, particularly other nations, take a different view about the future.
Energy-Output Coefficients: Complex Realities Behind Simple Ratios
Authors: Watkins G. C , Berndt E. R.
Published: May 2011

The demand for energy is a derived demand, since it is transmitted from demands for goods and services that incorporate energy as an input. Trends in the ratio of energy consumption to the level of output the so-called energy coefficient-are often used to examine energy demand in the industrial and other demand sectors.' In a market economy, the inference of this approach is that at a time of increasing energy prices, a rise in the energy coefficient is an indication of waste and inefficiency or of a perverse price response. Correspondingly, a fall in the energy coefficient is evidence of the efficacy of the price mechanism and government regulations in promoting energy conservation.
The International Energy Investment Dilemma
Authors: Paul Tempest
Published: May 2011

There never has been a global energy market. What there is, at the consumer end, is an amalgam of national energy systems developed from local resources onto which have been grafted various energy imports. Of these, the only truly internationally traded energy commodity is oil. For their base-load energy needs, most national economies have relied on committed systems of domestic supply usually embedded deeply in their own public utility infrastructure and industrial systems. The prices to the consumer of all these forms of energy are heavily masked by subsidy, taxation, and other forms of government control. The availability of domestic energy varies greatly from country to country. There are therefore great variations between countries (and also within countries) in the resource cost of energy and the price to the consumer.
The Impact of the Oil Price Decline on the Soviet Union and Eastern Europe
Authors: Jan Vanous
Published: May 2011

The effects on the Soviet Union and Eastern Europe of the decline in the world market price of oil (and the subsequent likely decline in international prices of natural gas and coal) can be divided into three groups: direct, or first-round effects-the impact of the decline in net hard-currency export revenue/net import outlays for oil and other types of energy; "spillover" effects-the impact of potential Soviet cutback in the quantity of energy sold to Eastern Europe for nonconvertible rubles and at preferential prices; indirect, or secondary effects-the impact of oil price cuts on world market interest rates and thus the cost of debt servicing; the impact on Western economic recovery and thus the demand for imports from the Eastern bloc, and so on.
Global Energy and C02 to the Year 2050
Authors: Jae Edmonds , John Reilly
Published: May 2011

One of the important by-products of the combustion of fossil fuels is carbon dioxide (C02), a nontoxic, colorless gas with a faintly pungent odor and acid taste. Carbon dioxide is not commonly thought of as a pollutant. Rather, COs plays an important role in the determination of the global climate. The presence of C02 in the atmosphere produces a "greenhouse effect," allowing incoming sunlight to penetrate but trapping heat radiated back from earth. Man's ability to significantly affect COs levels through use of fossil fuel gives rise to the possibility of climate change at unprecedented rates.
Energy Demand Elasticities in Industrialized Countries: A Survey
Authors: George Kouris
Published: May 2011

A high price elasticity for energy demand implies a long-term ability of the economy to absorb the impact of higher energy prices. Thus price shocks, after generating pronounced inflationary and recessionary effects over the short term, do not act as a constraint to economic growth over the longer term. By contrast, a low price elasticity implies weak reactions to increasing energy costs and a protracted adverse effect on output and inflation. Unfortunately, a survey of the literature on energy demand elasticities shows diverse results. Should econometric results be used for policymaking and planning, then a critical and eclectic attitude is imperative to screen out the most relevant aspects of the empirically determined price elasticities.
Oil and Gas Supply Modeling under Uncertainty: Putting DOE Midterm Forecasts in Perspective
Authors: Harris Carl M.
Published: May 2011

The original purpose of this study was to examine the midterm projections of oil and gas production generated by the 1979 version of the Department of Energy's Midterm Oil and Gas Supply Modeling System (MOGSMS) for the 1979 Annual Report to Congress.q These forecasts applied to conventional oil and gas, onshore and offshore, in the lower 48 states from 1985 to 1995, inclusive. The specific objective of the work was to quantify the sensitivity of these projections to potential uncertainty in some of the model's key elements. But more generally, this exercise is viewed as but one good example of how to estimate the uncertainty in forecasts coming from a large computer-based model.
Petroleum Price Elasticity, Income Effects, and OPEC's Pricing Policy
Authors: Gerard Adams F. , Marquez Jaime
Published: May 2011

A standard result from static economic theory is that a monopolist with zero cost will maximize profits by charging the price at which the demand has unit elasticity. Yet, the demand for petroleum, as seen by consumers, is price inelastic, and empirical estimates of the price elasticity for petroleum are typically less than one. Given the relatively low production cost for Middle East oil and the optimization rule referred to above, a natural question is whether OPEC, acting as a monopoly, has exhausted its potential for forcing price increases or whether it will ultimately be able to charge still higher prices as it tries to optimize its earnings. This possibility of higher oil prices is important for OPEC and for oil-consuming countries-for OPEC because the finite nature of resources implies that excess production today represents an irrecoverable loss; for consuming countries because of the high cost of oil and the adverse consequences of still higher oil prices on inflation and unemployment.
Energy Prices, Capital Formation, and Potential GNP
Authors: Burgess David F.
Published: May 2011

A common theme of the rapidly developing literature on energy-economy interaction is that higher energy prices-initiated by external events such as OPEC-will permanently reduce the growth potential of net energy-importing economies even if full-employment conditions are maintained. According to this literature, in the absence of government measures to encourage saving and investment any initial adverse effect on the economy's real income at full employment (hereafter referred to as potential GNP) resulting from the need to pay a higher real price for imported energy will be compounded by secondary effects that reduce the rate of capital formation. This secondary or reverse feedback effect through capital may be the largest component of the overall impact on potential GNP.
Are Federal Energy Tax Credits Effective? A Western United States Survey
Authors: Carpenter Edwin H. , Chester S. Theodore
Published: May 2011

The residential energy credit provided by the federal Energy Tax Act (1977) cannot be carried beyond December 31, 1987, and the Reagan administration has indicated a disinclination to support an extension of its provisions, in either its current or an altered form. Its likely demise indicates nothing about the Act's effectiveness in getting homeowners to invest in energy conservation or solar devices. Rather, it is a reflection of the Reagan philosophy of letting market conditions determine energy conservation decisions. Since the administration is not explicitly passing judgment on the success or failure of residential tax credits, important questions regarding their efficacy remain to be answered. This paper will attempt to shed light on this question. It will examine data derived from a random sample of Western United States homeowners to determine awareness and use of the federal energy tax credit; the role of climate and dwelling type; and the influence of selected socioeconomic factors on the use of energy tax credits. Most important, it will seek to determine the extent to which conservation decisions were contingent on the availability of the tax credits, i, e., what proportion of investments were made wholly or predominantly because of their special tax inducements and what proportion would have been made in any case.
Residential Electricity Demand: A Suggested Appliance Stock Equation
Authors: Garbacz Christopher
Published: May 2011

A large amount of work in residential electricity demand has relied on logit estimation of a disaggregated appliance stock. (See the seminal work by McFadden et al., 1977.) While this approach may be suitable for certain types of models with certain goals in mind, a simple formulation of an appliance stock equation may sometimes be appropriate. For example, if the goal is to estimate seasonal patterns in elasticities employing a national micro-data set (as in the National Interim Energy Consumption Survey 1978-1979; see U.S. Department of Energy, 1980), then it may be appropriate to develop an appliance stock equation to predict the size of an appliance stock index (approximating a continuous variable). The present appliance stock equation is part of a three-equation model that is estimated in log-linear form via 2SLS.
Summer Time and Electricity Conservation: The Israeli Case
Authors: Shore Haim
Published: May 2011

Summer Time (ST) refers to the practice of advancing the clock during the summer (commonly by one hour) in order to adjust it to changes of sunrise and sunset times at that period. Conventionally, ST is expected to accomplish three objectives: To reduce electricity consumption during dark evening hours. To reduce use of air conditioning systems during the morning. This effect, the result of an additional cool hour, is partially offset by an increased consumption of electricity for lighting during very early morning hours. To increase productivity (particularly in the industrial sectors that are not air-conditioned) following an additional cool hour in the morning.
Capital-Energy Substitution in the Long Run
Authors: Gibbons Joel
Published: May 2011

Econometric modeling of production relationships, especially those of manufacturing industries, entered a period of intense activity with the dramatic energy price shocks of the past ten years. This work has called attention to possibilities for substitution between energy and other factors, but it has not yet led to consensus on all the important issues.' One open issue has to do with the relative substitutability of fixed capital for energy, compared with the substitutability of other factors for energy. One set of studies, generally those based on international cross-section data, finds capital and energy to be Hicksian substitutes. Other studies, based on time series data, find them to be Hicksian complements.
Residential Electricity Demand Modeling in the Australian Capital Territory: Preliminary Results
Authors: Donnelly W. A.
Published: May 2011

The demand for electricity has recently become a topic of major interest in Australia, where very little empirical analysis has been done (see Hawkins, 1975; Saddler et al., 1980; Department of National Development and Energy, 1981; Brian and Schuyers, 1981; and Donnelly and Saddler, 1982). Two of the policy issues being raised concern the appropriate pricing strategies that should be adopted by supplying authorities and the need for additional generating capacity. An understanding of the relative importance of the factors influencing electricity demand is required to aid public policy making, particularly since substantial investment is now being considered.
International Oil Agreements
Authors: Adelman M. A.
Published: May 2011

The 1980 report of the Brandt Commission, calling for "a global agreement ... between oil producing and consuming countries" to assure adequate production at reasonable prices, states the gist of innumerable reports, articles, speeches, and resolutions, urging cooperation, dialogue, and interdependence.
The Cost of Synthetic Fuels in Relation to Oil Prices—Revisited
Authors: Daniels Edward J.
Published: May 2011

... you can catch phenomena in a logical or in a mathematical box. The logical box is coarse but strong. The mathematical box is fine grained but flimsy. The mathematical box is a beautiful way of wrapping up a problem, but it will not hold the phenomena unless they have been caught in a logical box to begin with. In the beginning we generally believed that if the price of conventional oil continued to increase, at some point the price of synthetic fuels would become competitive. But in March 1981 we learned from a report prepared for the 97th Congress (Congressional Research Service, 1981) that the costs of synthetic fuels are driven by the cost of oil: even if oil were to reach $100 per barrel, synthetic fuels would still be more expensive! 2 Finally we knew that synthetic fuels could never be justified on an economic basis. The additional knowledge gained from the work (to wit, that interest rates could be predicted with a high degree of confidence on the basis of oil prices alone) was merely incidental.
The Role of Energy in Productivity Growth
Authors: Dale W . Jorgenson
Published: May 2011

The objective of this paper is to analyze the role of energy in the growth of productivity. The special significance of energy in economic growth was first established in the classic study Energy and the American Economy 1850-1975, by Schurr and his associates (1960) at Resources for the Future. From 1920 to 1955, Schurr noted, energy intensity of production had fallen while both labor and total factor productivity were rising.' The simultaneous decline of energy intensity and labor intensity of production could not be explained solely on the basis of substitution of less expensive energy for more expensive labor. Since the quantity of both energy and labor inputs required for a given level of output had been reduced, technical change would also be a critical explanatory factor. From 1920 to 1955 the utilization of electricity had expanded by a factor of more than ten, while consumption of all other forms of energy only doubled. The two key features of technical change during this period were that (1) the thermal efficiency of conversion of fuels into electricity increased by a factor of three, and (2) "the unusual characteristics of electricity had made it possible to perform tasks in altogether different ways than if the fuels had to be used directly."2 For example, as Schurr noted, the electrification of industrial processes had led to much greater flexibility in the application of energy to industrial production.
Rate-of-Return Attrition and Inflation-Induced Penalties in Public Utility Common Stocks
Authors: Davidson Wallace N. , Glascock ohn L.
Published: May 2011

While the rate of inflation seems to be easing, the interest in its impact on corporate security prices (Feldstein, 1980) and on corporate investment policy (Caks, 1981; Higgins, 1977) has continued. Unlike nonregulated firms, utilities face the added difficulties of regulation-induced inflation penalties and return on equity (ROE) attrition.
The Effects of Natural Gas Decontrol on Fertilizer Demand, Production Costs, and Income in Agriculture
Authors: LeBlanc Michael
Published: May 2011

Under the provisions of the Natural Gas Policy Act of 1978 (NGPA), about 50 percent of natural gas production will be decontrolled in 1985. Whether natural gas is decontrolled under the provisions of NGPA or new decontrol legislation is enacted, real natural gas prices are likely to increase during the next few years. Rising natural gas prices will directly affect agriculture by increasing crop drying and irrigation costs. However, the largest effects will occur indirectly through increases in nitrogenous fertilizer prices; natural gas represents 60 to 70 percent of fertilizer production costs (Lutton and Andrilenas 1983). Because farm production expenses have increased nearly $100 billion from 1970 through 1981 (U.S. Department of Agriculture 1982b) and real farm income has decreased 70 percent during the same period, the decontrol of natural gas is viewed with concern by the agricultural community.
Economic Demand Analysis for Electricity in West Africa
Authors: Glakpe Emmanuel , Fazzolare Rocco
Published: May 2011

Past and future electricity demand was analyzed for seven countries of West Africa: Ghana, Nigeria, Ivory Coast, Republic of Niger, Togo, Benin, and Burkina Faso (until recently Upper Volta). These countries constitute approximately 84 percent of the West African population. Primary energy resource endowments include agricultural waste, fossil fuels, hydra power, and some deposits of uranium (not uniformly distributed). Each country has some hydro power, with Nigeria having the largest resources. Deposits of crude oil have been discovered in most of the countries. Nigeria leads in known oil reserves and produces about 2.5 million barrels of oil a day. In contrast, Burkina Faso has very little available energy resources beyond a small hydro power potential.
Oil Prices Are Still Too High
Authors: Tussing Avion R.
Published: May 2011

Predictions that the constant-dollar price of oil will rise again to surpass and remain above the all-time peaks reached in 1981 rest on strong logical premises. The truism that natural resources are finite unites with the paradigms of Malthus, Ricardo, and Hotelling to imply that the terms of trade will forever flow in favor of resource owners, particularly the owners of depletable resources.
Long-Run Effects of the Canadian National Energy Agreements
Authors: Schwartz S. L. , Fuller J. D. , Ziemba W. T.
Published: May 2011

For the last decade Canadian energy policy and oil pricing policy have been subjects of heated debate, dividing the country into several interest groups. The debate began when the federal government shielded the Canadian consumer from rapid world oil price increases by freezing domestic wellhead prices and subsidizing oil imports. This created a single price for oil across the entire country (except for transportation cost differences). The subsidy was to be paid by an export tax equivalent to the difference between domestic price and the world price. This policy was seen as an immediate response to a short-term problem: either world prices would return to lower levels or domestic prices could slowly adjust to the higher level without creating a price shock. Once a subsidy is established, however, it is hard to withdraw. Industries and consumers that rely on low-cost oil can be expected to lobby for continued subsidies. By observing real costs, moreover, the Canadian subsidy destroyed incentives to conserve costly fuels (e.g., imported oil). And there was no incentive to increase domestic production of such valuable commodities. By intervening, the federal government appeared to take on the responsibility of maintaining a status quo with respect to regional income distribution. Thus the scene was set.