Documents

1. Estimating the macroeconomic benefits of energy efficiency policy and measures

   Ryan, Lisa; Campbell, Nina, 2014

   Summary

   Increasingly, research is showing that energy savings from energy efficiency improvements can deliver wider benefits across the whole economy such as increases in employment, GDP, trade balances, energy security etc. Given the complexity of the interactions throughout the economy, and the high level of interest by governments in understanding and predicting them, it is important to have a robust methodological framework for carrying out energy efficiency policy assessments. There is also the question of how the macroeconomic benefits impact energy consumption and whether these indirect rebound effects offset much of the initial energy savings from the energy efficiency measures. This paper investigates these interactions and provides guidance to policy makers on how to measure the macroeconomic impacts of energy efficiency measures. It also provides an overview of estimates in the literature how macroeconomic indicators are affected. However, one must be aware that impacts on these indicators are dependent on the structure and nature of the economy, the scale and substance of realised energy efficiency outcomes, and the distribution of outcomes across consumers and producers. Moreover, there are difficulties when comparing studies due to different methods used etc. According to GDP increase, estimates range from 0.1% to 1.26%. The number of net job years created per million euros invested ranges from 7 to 22. Trade is positively affected as well, albeit only slightly (0.2 – 0.5%). Energy prices are also expected to decline as a consequence of energy efficiency measures.

2. Energy substitution, efficiency, and the effects of carbon taxation: Evidence from China's building construction industry

   Liu, Hongxun; Lin, Boqiang, 2017

   Summary

   As buildings are constructed to be more energy-efficient and environmental friendly, the building construction industry, which is a basic and leading industry of the national economy development, has become one of the key sectors for energy conservation and emission reduction in China. This paper aims at quantifying both inter-factor and inter-energy substitution for China's building construction industry and investigates the main driving forces behind energy efficiency changes as well as the CO2 abatement effect of a uniform carbon tax in this sector. The model is established employing provincial pooled data over 2003-2012 in China by regions; hence, results between different regions are compared. The main findings indicate that a) energy and non-energy are substitutes whereas individual energy inputs are complementary in China's building construction industry. The substitution effect varies across regions due to different factor endowments and marketisation levels. b) Energy price increase and construction scale expansion leads to energy efficiency improvement while substitution and technology present negative influences on energy efficiency. c) Approximately 3 % of the CO2 emissions in China's building construction industry can be reduced by carbon taxation based on the integrated own- and cross-price elasticities of each type of energy.

3. The Relationship between Input Prices and Energy Intensity in Canadian Manufacturing Industries

   Gamtessa, Samuel, 2009

   Summary

   This study analyses the roles that energy and other input prices play in reducing the energy intensity of manufacturing industries in Canada. It finds that the average energy price elasticity of energy intensity is about −0.39 for the manufacturing sector, with a 95 percent CI of −0.43 to −0.34. The calculated average elasticities of substitutions indicate that both capital and labour are complementary with energy while both materials and services inputs are substitutes. The industry-specific estimates, however, reveal widespread differences in terms of both the magnitude of the elasticities and the patterns of the relationships among the inputs.

4. Price Effects as a Benefit of Energy-Efficiency Programs

   Chernick, Paul; Plunkett, John J., 2014

   Summary

   Increased energy efficiency reduces load on the gas or electric system, the amount of energy that must be purchased or produced to serve customers, and participants’ energy bills directly. Where energy is supplied from competitive markets, energy efficiency further reduces the price of that energy, indirectly reducing the energy bills of all consumers when savings are passed on to ratepayers. Those price reductions are typically vanishingly small when expressed in dollars per MWh or per MMBtu of total consumption. However when expressed in dollars per MWh or MMBtu saved, the cost reductions can be substantial, even rivaling the direct avoided costs. In the utility industry, this kind of price suppression has come to be known as Demand Reduction Induced Price Effect (DRIPE). The paper describes the basis for including DRIPE as a benefit in program screening. It also describes several categories of DRIPE and approaches for quantifying price reduction benefits. Since electric efficiency generally reduces gas use in generation, and lower gas prices produce lower electric market prices in restructured markets, a number of cross-fuel DRIPE effects are identifiable. For each category of DRIPE, the paper describes the situations in which DRIPE would exist, how DRIPE coefficients can be estimated from historical data or modelling, and how DRIPE should be adjusted to reflect existing supply arrangements and the decay of the DRIPE effect due to demand- and supply-market responses.

5. Measuring multiple impacts of low-carbon energy options in a green economy context

   DianaÜrge-Vorsatz, Agnes Kelemen, Sergio Tirado-Herrero, StefanThomas, Johannes Thema, Nora Mzavanadze, Dorothea Hauptstock, Felix Suerkemper, Jens Teubler, Mukesh Gupta, Souran Chatterjee, 2016

   Summary

   The paper identifies a few key challenges to the evaluation of the co-impacts of low-carbon options and demonstrates that these are more complex for co-impacts than for the direct ones. Such challenges include several layers of additionality, high context dependency, and accounting for distributional effects.

This Indicator is under development.