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Implementation of some of the articles of the Kyoto Protocol will require rules for accounting and for defining baselines against which reduction of greenhouse-gas emissions, or enhancement of greenhouse-gas removals, are to be measured. Project accounting needs to provide incentives to ensure that the objective of the United Nations Framework Convention on Climate Change (UNFCCC) is served and that the interests of all participating parties are respected. To establish the emission reduction achievements of activities is complex as it is inherently very difficult to define the counterfatctuel baseline. Here, we articulate four basic principles — accuracy, comprehensiveness, conservativeness and practicability — that can be used to guide the construction of baselines for greenhouse-gas mitigation projects. The overall aim is to have accurate, comprehensive, and conservative baselines; but this aim needs to be balanced to yield baselines that are as simple as possible, can be practically implemented, and provide incentives to fulfill the ultimate objective of the UNFCCC.

Abstract We analyze the rate of return (ROR) and risk factors faced by Shell Exploration, an international oil company (IOC), in its Soroosh and Nowrooz buy-back service contract in Iran. In particular, based on our models of cash flow, we analyze the buy-back contract specific risk factors that can contribute to a reduction in the rate of return for the international oil company. Our cash flow models resemble the cash flow of buy-back service contracts before the Iranian government changed the way it determined the capital cost ceiling and pre-defined the oil price in these contracts in 2008–2009. Our actual and contractual cash flow models reveal that Shell Exploration's actual ROR was much lower than the contractual level. Furthermore, we find that among the risk factors that we considered, a capital cost overrun has the greatest negative effect on the IOC's ROR. Moreover, we show that there is a potential for modifying the contracts in order for the IOC to face an actual ROR closer to the contractual ROR even if the contract faces cost overrun or delay, without exceeding the maximum contractual ROR that the National Iranian Oil Company is willing to give.

In this study, we apply the inter-regional input–output model to explain the relationship between China’s inter-regional spillover of CO2 emissions and domestic supply chains for 2002 and 2007. Based on this model, we propose alternative indicators such as the trade in CO2 emissions, CO2 emissions in trade and the regional trade balances of CO2 emissions. Our results do not only reveal the nature and significance of inter-regional environmental spillover within China’s domestic regions but also demonstrate how CO2 emissions are created and distributed across regions via domestic and global production networks. Results show that a region’ sC O2 emissions depend on its intra-regional production technology, energy use efficiency, as well as its position and participation degree in domestic and global supply chains. & 2013 Elsevier Ltd. All rights reserved.

In a world that increasingly invites private actors to address social needs, there has been a rise of social enterprises in a variety of sectors, including new and renewable energy. As of yet, little research has focused on how these enterprises interact with government policy in low- and middle-income countries. This research specifically explores how social enterprises operating in rural India with decentralized renewable energy solutions seek to access government support, and what strategies they adopt to engage with the government. An inductive theory-building approach was adopted to explore this and advance current knowledge in the boundaries of social entrepreneurship and policy. We propose ‘Engagement’ and ‘Disengagement’ as the two strategies used by social enterprises in this context in accessing government support and policy. ‘Engagement’ is a strategy comprising of the tactics: (a) Leveraging Policy, (b) Building and Leveraging Relationships, (c) Lobbying, and (d) Monitoring. ‘Disengagement’ is a strategy comprising of the tactics: (a) Avoiding Government Presence, and (b) Disengagement from Policy.

Abstract Carbon capture and storage (CCS) in China is currently discussed extensively but few in-depth analyses focusing on economics are observed. In this study, we answer two related questions about the development of CCS and power generation technologies in China: (1) what is the breakeven carbon-dioxide price to justify CCS installation investment for Integrated Gasification Combined Cycle (IGCC) and pulverized coal (PC) power plants, and, (2) what are the risks associated with investment for CCS. To answer these questions, we build a net present value model for IGCC and PC plants with capacity of 600 MW, with assumptions best representing the current technologies in China. Then, we run a sensitivity analysis of capital costs and fuel costs to reveal their impact on the carbon price, and analyze the risk on investment return caused by the carbon price volatility. Our study shows that in China, a breakeven carbon price of $61/tonne is required to justify investment on CCS for PC plants, and $72/tonne for IGCC plants. In this analysis, we also advise investors on the impact of capital and fuel costs on the carbon price and suggest optimal timing for CCS investment.

Abstract This paper approaches the measurement of energy efficiency from a production theoretic framework and uses Data Envelopment Analysis to measure energy efficiency in the Indian manufacturing sector. Using data from the Annual Survey of Industries for the years 1998–99 through 2003–04, the study compares the energy efficiency in manufacturing across states, based on several models. The results show considerable variation in energy efficiency across states. Comparing the results across our models, we find that the relative pricing of energy does not provide the appropriate incentives for energy conservation. A second-stage regression analysis reveals that states with a larger share of manufacturing output in energy-intensive industries have lower energy efficiency. Also, higher quality labor force associates with higher energy efficiency. Finally, the power sector reforms have not yet had any significant impact on achieving energy efficiency.

Abstract The resource curse is sometimes associated with poor resource-rich countries. However, using panel evidence from the United States, we find that the resource curse is also prevalent in a wealthy resource-rich country. This study investigates the impact of oil resources on income inequality, with a particular focus on distinguishing between the effects from oil abundance (i.e. production) versus oil dependency (i.e. consumption). We observe contrasting non-monotonic outcomes from oil abundance in comparison to oil dependency. For oil abundance, states with low oil production will have less inequality if they increase oil production, and states with high oil production will have increased income inequality if they increase production. The opposite holds true for oil dependency. The findings suggest several channels of concern. For example, oil-rich states are more vulnerable to rent-seeking behaviour as oil production and oil revenues increase, which can adversely affect the income distribution gap. On the other hand, oil-dependent states are more likely to be affected by commodity price shocks which can increase income inequality.

Abstract Investment risk and uncertainty about the availability of biomass feedstock hinders the development of a mature cellulosic biofuel sector. The Biomass Crop Assistance Program (BCAP) is a federal program designed to subsidize farmers to establish, produce and deliver biomass feedstock to biorefineries. This study evaluated the impacts of BCAP on the optimal biofuel supply chain decisions considering feedstock yield uncertainty and associated investment risk given diverse risk preferences of the biofuel sector. The expected cost for a risk-neutral biofuel sector was minimized using a two-stage stochastic mixed integer linear program, whereas the Conditional Value-at-Risk of the supply chain was optimized for a risk-averse sector. Ex-ante analysis of a switchgrass-based biofuel sector in west Tennessee indicates BCAP payments could lower expected cost and investment risk for both risk-averse and risk-neutral biofuel sectors. However, the cost saving and risk reduction resulting from BCAP incentives for the risk-averse biofuel sector were higher than the risk-neutral biofuel sector. In addition, BCAP payments may drive more cropland to be converted for switchgrass, which potentially mitigates water-induced soil erosion and reduces greenhouse gas emissions associated with net carbon sequestration, but may also create unintended consequence of competition for land between food and fuel use.