882,157 research outputs found
Gasoline Demand, Pricing Policy and Social Welfare in Iran
This study estimates a gasoline demand function for Iran using the structural time series model over the period 1968-2002 and uses it to estimate the change in social welfare for 2003 and 2004 of a higher gasoline price policy. It is found that short and long run demand price elasticities are inelastic, although the response is greater in the long run. Hence, social welfare is estimated to fall because of the higher gasoline price (ceteris paribus). However, allowing all variables in the model to change, social welfare is estimated to increase since the changes in the other variables more than compensate for the negative effects of the policy.
US Residential Energy Demand and Energy Efficiency: A Stochastic Demand Frontier Approach
This paper estimates a US âfrontierâ residential aggregate energy demand function using panel data for 48 âstatesâ over the period 1995 to 2006 using stochastic frontier analysis (SFA). Utilizing an econometric energy demand model, the (in) efficiency of each state is modelled and it is argued that this represents a measure of the inefficient use of residential energy in each state (i.e. âwaste energyâ). This underlying efficiency for the US is therefore observed for each state as well as the relative efficiency across the states. Moreover, the analysis suggests that energy intensity is not necessarily a good indicator of energy efficiency, whereas by controlling for a range of economic and other factors, the measure of energy efficiency obtained via this approach is. This is a novel approach to model residential energy demand and efficiency and it is arguably particularly relevant given current US energy policy discussions related to energy efficiency.Energy demand; US residential energy demand; efficiency and frontier analysis; state energy efficiency.
Can the North Sea Still Save Europe?
In the 1980s and 1990s the North Sea emerged as a key non-OPEC oil producing province. Yet today overall production is declining, in both the British and Norwegian sectors and the big oil companies and investors are losing interest in what they now see as a mature province. But apparent maturity is not a bar to new prospects and new possibilities. This paper analyses not merely the still significant potential of the North Sea, but also the wider and increasingly attractive prospects offered by the opening up of the High North, the Barents Sea and part of the Arctic region â all areas of rapidly growing interest which are on Europeâs doorstep. Success will depend heavily on key questions such as the world oil price trend, technological advance and the structure of fiscal regimes for oil and gas extraction. But the opportunities are there and they could be to Europeâs great advantage.North Sea, High North, Fiscal Regime, Oil Price, Mature Oil Province
Transportation Oil Demand Consumer Preferences and Asymmetric Price Responses: Some UK Evidence
The aim of this paper is to (i) establish the role of asymmetric price decompositions in UK road transportation fuel demand, (ii) make explicit the impact of the underlying energy demand trend and (iii) disaggregate the estimation for gasoline and diesel demand as separate commodities. Dynamic UK transport oil demand functions are estimated using the Seemingly Unrelated Structural Time Series Model with decomposed prices to allow for asymmetric price responses. The importance of starting with a flexible modelling approach that incorporates both an underlying demand trend and asymmetric price response function is highlighted. Furthermore, these features can lead to different insights and policy implications than might arise from a model without them. As an example, a zero elasticity for a price-cut is found (for both gasoline and diesel) implying that price reductions do not induce demand for road transportation fuel in the UK. The paper illustrates the importance of joint modelling of gasoline and diesel demand incorporating both asymmetric price responses and stochastic underlying energy demand trends.Diesel; Asymmetry; Price; Underlying Energy Demand Trend (UEDT).
Non-linear technological progress and the substitutability of energy for capital: an application using the translog cost function.
This paper analyses the production process of four industries over four separate time periods using datasets taken form Berndt and Wood (1975, 1979), Hunt (1984a, 1986), Norsworthy and Harper (1981) and Jorgensen and Stiroh (2000). In their initial paper Berndt and Wood failed to explore the alternative options available to them to represent technological progress, a deficiency noted by Hunt (1986) who tested for alternative representations of technology (inter alia) using the Berndt and Wood data. This paper extends this line of reasoning/research by allowing technological progress to take more flexible non-linear forms using both deterministic and stochastic trend models. The results reveal that ânon-linear trendâ models are generally preferred to âlinear trendâ or âno trendâ models hence raising a question over the validity of assumptions used in much previous empirical research. Further the results reveal that the different assumptions lead to different results for the energy-capital elasticity of substitution.Translog, energy-capital substitution, productivity
Measuring energy efficiency and its contribution towards meeting CO2 targets: estimates for 29 OECD countries
Using results for 29 OECD countries from the estimation of an extended version of the model advocated by Filippini and Hunt (2011a), actual energy consumption and CO2 emissions are compared to notional energy consumption and CO2 emissions if the countries were energy efficient. This shows the contribution that improvements in energy efficiency can make towards the reduction in CO2 emissions. It is found that in many countries efficiency improvements alone are not likely to be sufficient to bring about reductions in CO2 emissions required to meet ambitious obligations. However, this is not the case across all countries included in the investigation. Moreover, it is shown that some of the worldâs largest OECD emitters can make a significant contribution to CO2 reductions from becoming energy efficient. Therefore the negotiations of the new legally binding treaty agreed under the Durban Platform should promote emission reduction targets that incentivise national energy efficiency.emissions, energy efficiency, Durban Platform.
Frontier Analysis of UK Distribution Networks and the Question of Mergers: A Critique of Ofgem
Since privatization, the 14 UK electricity distribution network operators (DNOs), being natural monopolies, have been subject to RPI-X regulation by the UK regulator (Ofgem). Mergers between the 14 DNOs have formed 7 identifiable ownerships (management teams). It is argued in this research that Ofgem has not used a sufficiently robust approach to benchmarking, and has therefore failed to accurately assess network efficiency gains. Furthermore, Ofgem has used invalid arguments against further mergers. By using more informative panel datasets, as well as a more robust estimation technique (Stochastic Frontier Analysis), this research reveals two crucial facts. Firstly, there is almost no more room for the DNOs in question to become more cost efficient, as the industry is operating close to minimum efficient scale. This suggests that Ofgem needs to widen its scope of benchmarking and regulation (e.g. quality-incorporated benchmarking). Secondly, there seems to be no increasing returns to scale in the industry, a more appropriate reason why further mergers should not take place.Ofgem, Frontier Analysis, Mergers.
An Empirical Analysis of Energy Demand in Namibia
Using a unique database of end-user local energy data and the recently developed Autoregressive Distributed Lag (ARDL) bounds testing approach to cointegration, we estimate the long-run elasticities of the Namibian energy demand function at both aggregated level and by type of energy (electricity, petrol and diesel) for the period 1980 to 2002. Our main results show that energy consumption responds positively to changes in GDP and negatively to changes in energy price and air temperature. The differences in price elasticities across fuels uncovered by this study have significant implications for energy taxation by Namibian policy makers. We do not find any significant cross-price elasticities between different fuel types.Energy demand; ARDL; Cointegration
Estimating Underlying Energy Demand Trends using UK Annual Data
Employing the Structural Time Series Model (STSM) approach suggested by Harvey (1989, 1997), and based on annual data for the UK from 1967-2002, this paper reiterates the importance of using a stochastic rather than a linear deterministic trend formulation when estimating energy demand models, a practice originally established by Hunt et al. (2003a,b) using quarterly UK data. The findings confirm that important non-linear and stochastic trends are present as a result of technical change and other exogenous factors driving demand, and that a failure to account for these trends will lead to biased estimates of the long-run price and income elasticities. The study also establishes that, provided these effects are allowed for, the estimated long-run elasticities are robust to the different data frequencies used in the modelling.Energy Demand, Underlying Trends.
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