• Energy Research
• Closed Access close
• Embargo close
• 8. Economic growth close
• ES close
• EU close

Abstract The main aim of this paper is to analyse whether the adoption of sustainable energy systems improves corporate financial performance. To this end, we obtained data from a sample of 574 multinational companies from 36 countries in the 2008–2013 period. On this data we implement a dynamic system panel data method. Our findings show that the adoption of sustainable energy systems allows firms to improve their short-term corporate financial performance while not leading them to reduce their corporate financial performance in the long term. Specifically, our results indicate that an increase in energy efficiency and the use of renewable energy sources do not significantly affect corporate financial performance. Neither does the integration of energy efficiency systems and renewable energy sources have any significant influence on corporate financial performance, while the level of implementation of sustainable energy management systems has a significant effect on short-term, but not long-term, corporate financial performance. Furthermore, other control variables, such as research and development expenditure and year, are also relevant in explaining firms’ financial performance. The adoption of sustainable energy systems helps to improve corporate financial performance in the short-term but has no affect in the long-term. This might be because the monitoring of energy efficiency using key performance indicators allows firms to detect and correct failures in the production process and hence improve short-term financial performance. However, this measure does not generate competitive advantages for firms and therefore has no effect on long-term corporate financial performance. From a scientific perspective of energy, this paper contributes to the literature by providing a detailed explanation of how the adoption of sustainable energy systems proposed by Peura (2013) influences corporate financial performance on the basis of new empirical evidence. These explanations provide a strong rationale for improving the efficient use of energy and harvesting low hanging fruits in the short term from a managerial perspective. Policymakers should encourage firms to align sustainable energy systems with their core business strategy by developing green technologies that allow them to acquire rare and valuable capabilities and abilities, which generate competitive advantage, and therefore allow firms to increase their long-term corporate financial performance.

Abstract Herein a novel path is analysed for its economic viability to synergize the production of biomethane and dimethyl ether from biogas. We conduct a profitability analysis based on the discounted cash flow method. The results revealed an unprofitable process with high cost/revenues ratios. Profitable scenarios would be reached by setting prohibitive DME prices (1983–5566 €/t) or very high feed-in tariffs subsidies (95.22 €/MWh in the best case scenario). From the cost reduction side, the analysis revealed the need of reducing investment costs. For this purpose, we propose a percentage of investment as incentive scheme. Although the size increase benefits cost/revenues ratio, only the 1000 m3/h biogas plant size will reach profitability if 90% of the investment is subsidized. A sensitivity analysis to check the influence of some important economical parameters is also included. Overall this study evidences the big challenge that our society faces in the way towards a circular economy.

Lack of consensus on an international agreement for reducing Greenhouse Gas Emissions (GHG) emissions eventually leads to asymmetric climate policies which not only increase the cost of reducing emissions but also decrease the effectiveness of the climate policy, through carbon leakage. We calculate the carbon leakage rate when EU undertakes a unilateral climate policy and we assess the importance of the competitiveness channel on carbon leakage. Our analysis is global and mirrors energy and climate policies and commitments that are currently announced at country level. The effectiveness of possible measures to mitigate carbon leakage is also evaluated and the results emphasize on the importance of the size of the group of countries participating in the GHG mitigation effort. The analysis is based on the results obtained using the GEM-E3 model, a global multi-sector and multi-country computable general equilibrium model. It is found that total carbon leakage is around 28%, over the 2015–2050 period, when the EU acts alone with moderate Armington trade substitution elasticity values; leakage rates are found to increase when assuming higher trade elasticities. The size and composition, in terms of GHG and energy intensities, of the group of regions undertaking emission reductions matter for carbon leakage. The paper finds that the leakage is significantly reduced when China joins the mitigation effort. If the USA joins the EU effort, the leakage rate drops only to 25% and if alternatively China joins the EU the leakage rate drops to 3% over the 2015–2050 period. This is attributed to both the market size of China and to the energy intensity features of its production. Chemicals and metals are industries prone to higher leakage rates.

Abstract Several articles have confirmed the social and environmental consequences of opencast coal mining. The main purpose of this study is to simulate the optimal extraction policy of coal mining with and without the internalization of the environmental and social monetary costs that occur in the Mining District (located in the central part of the Department of El Cesar) using discrete dynamic programming (backward recursion, discrete state Markov decision model and Bellman equation). Results indicate that the private optimal of the overproduction policy for the terminal phase of the resource extraction program can be reduced once the negative externalities produced by mining practices are internalized into the cost function of the mining investment companies in Colombia. This means that if there is an increase in the total cost of extraction to offset the environmental and social impacts generated, the negative externalities would be less than or equal to the current level. Likewise, profits would continue being positive for the mining firms at the Mining District.

Abstract This paper analyses the effect of price regulation on the accounting policy of Spanish electricity companies over the period 1991–2001. As predicted by the political costs hypothesis ( Watts and Zimmerman, 1986 ) [Watts, R.L., Zimmerman, J.L. 1986. Positive accounting theory, Prentice Hall, Englewood Cliffs, NJ], managers artificially reduce reported earnings when the government establishes tariff increases. In this way, companies attempt to diminish their political visibility and counteract social outcry arising from the government's decision. Several abnormal accruals models existent in the literature are used to obtain a proxy for managerial accounting discretion on earnings.

Electricity prices have risen sharply in Spain in recent years, to the point where they are now among the highest in the EU. The scant competition between power utilities, changes in the law, and the tariff deficit (accumulated debt in favour, mainly, of the electricity firms), have driven up the cost of electricity, affecting numerous other industries such as irrigated agriculture, a sector that has significantly increased its electricity consumption as a result of modernization processes over the past twenty-five years. We examine these issues through a case study of an irrigation scheme in Spain that provides irrigation water and infrastructure to 58 farming communities in north-eastern Spain, and is highly representative of the Ebro Valley. Based on the results of direct estimations and simulations of different tariffs, we propose the lowering of capacity-based tariffs to reduce sector problems and cut energy costs, especially for farmers. We also raise the possibility of increasing self-consumption, a complementary measure for many farmers and for medium-size firms.

This study assesses the socio-economic impacts in terms of value added, imports and employment of sugarcane-derived bioethanol production in Northeast (NE) Brazil. An extended inter-regional Input–Output (IO) model has been developed and is used to analyse three scenarios, all projected for 2020: a business-as-usual scenario (BaU) which projects current practices, and two scenarios that consider more efficient agricultural practices and processing efficiency (scenario A) and in addition an expansion of the sector into new areas (scenario B). By 2020 in all scenarios, value added and imports increase compared to the current situation. The value added by the sugarcane–ethanol sector in the NE region is 2.8 billion US$ in the BaU scenario, almost 4 billion US$ in scenario A, and 9.4 billion US$ in scenario B. The imports in the region will grow with 4% (BaU scenario), 38% (scenario A) and 262% (scenario B). This study shows that the large reduction of employment (114,000 jobs) due to the replacement of manual harvesting by mechanical harvesting can be offset by additional production and indirect effects. The total employment in the region by 2020 grows with 10% in scenario A (around 12,500 jobs) and 126% in scenario B (around 160,000 jobs). The indirect effects of sugarcane production in the NE are large in the rest of Brazil due to the import of inputs from these regions. The use of an extended inter-regional IO model can quantify direct and indirect socio-economic effects at regional level and can provide insight in the linkages between regions. The application of the model to NE Brazil has demonstrated significant positive socio-economic impacts that can be achieved when developing and expanding the sugarcane–ethanol sector in the region under the conditions studied here, not only for the NE region itself but also for the economy of the rest of Brazil.

Abstract Considering residential per capita electricity consumption as one of the most suitable economic welfare indicators, the aim of this paper is to explore worldwide differences on this variable over the period 1980–2007. The paper adds to the standard practice of σ and β convergence analysis by tracking the external shape and time evolution of the entire distribution, applying nonparametric techniques (density functions and stochastic kernels) to a sample of 98 countries. The main finding is that a weak process of electricity consumption convergence has taken place. This reduction of disparities is clearly related to at least three issues: firstly, the rapid economic changes experienced by some developing countries; secondly, the energy conservation policies implemented by most developed countries following the first oil shock; and, thirdly, the growing awareness on energy issues in rich countries. Notwithstanding this, the ergodic distribution on per capita electricity consumption indicates that large cross-country disparities will persist in the long-run.

Abstract This paper describes the construction and analysis of a disaggregated input-output model and its extension to a social accounting matrix (SAM) for the Spanish economy in 2013. Our focus is the specific disaggregation of the electricity industry into the generating, transmission, distribution and marketing businesses, which were decoupled in 1997 under legislation prohibiting any single company from conducting more than one of them. The multi-sectoral framework also allows disaggregation of electricity generating by production technologies (wind, nuclear, conventional thermal, hydropower, solar and other technologies). To the best of our knowledge, this is the first paper in which this information is presented in a multi-sectoral framework for the Spanish economy, which is enormously dependent on the electricity industry. The structural analysis reveals the industry's role in Spain and the importance of its activities. None of the electricity generating businesses is a Rasmussen key sector, and generating and distribution are both capital-intensive activities. Meanwhile, conventional thermal and hydropower generating together make up more than 50% of total output in value terms, while nuclear power accounts for only around 7%. Finally, imports and exports of electricity are small, and almost all demand is covered by domestic production.