• Energy Research

Developing and emerging economies are implementing local content requirements (LCRs) to spur domestic manufacturing though their costs and benefits are not well understood and difficult to quantify. Here, we provide an empirical assessment of the short-term costs of LCRs using a credible counterfactual. We analyse data on government-run solar PV auctions held in India between 2014-2017 and exploit the fact that not all of the auctioned contracts entailed LCRs. We find that LCR policies resulted in a ~6% per kWh increase in the cost of solar PV power generated from those projects when compared to similar projects not subjected to the same LCR policy. During this three-year time period, Indian solar panels remained around 14% more expensive than international panels. We found some evidence of short-term increases in domestic manufacturing capacity, yet, during this short period Indian firms did not increase market share or break into export markets.

Contextualising on the internationally low oil prices era and historically high oil production in USA and refusal to honour the commitments under Paris Agreement (COP: 21), this study investigates the role of education, oil prices and natural resources on energy demand and CO2 emissions in the USA for the period of 1976-2016. In so doing, we employed a bounds testing approach to cointegration accounting for structural breaks in the series. Key findings suggest the presence of a long-run association between underlying variables. The abundance of natural resources and economic growth of the US economy seem to weigh on environmental quality by increasing energy consumption and carbon emissions. Oil prices show a negative association with energy consumption as well as carbon emissions suggesting that a low oil prices regime can lead to an increase in carbon emissions and energy consumption. Interestingly, education seems to play an important role by reducing energy consumption and carbon emissions, resultantly improving the US environmental quality. Our findings have profound environmental implications in terms of efforts to tackle climate change and meeting the Paris agreement (COP: 21) ambitions with reality and USA policy stance.

Carbon offsets from voluntary avoided-deforestation projects are generated on the basis of performance in relation to ex ante deforestation baselines. We examined the effects of 26 such project sites in six countries on three continents using synthetic control methods for causal inference. We found that most projects have not significantly reduced deforestation. For projects that did, reductions were substantially lower than claimed. This reflects differences between the project ex ante baselines and ex post counterfactuals according to observed deforestation in control areas. Methodologies used to construct deforestation baselines for carbon offset interventions need urgent revisions to correctly attribute reduced deforestation to the projects, thus maintaining both incentives for forest conservation and the integrity of global carbon accounting.

During the COVID-19 period, industrial production was slowed or halted due to COVID restrictions and lockdowns, followed by global tensions and conflicts, which created uncertainties for industrial production. Similarly, during this period, the growth in carbon emissions was seen shrinking. However, it is greatly important to explore whether this shrinking trend will continue or whether a new growth pattern could emerge. Considering this, the research was carried out to investigate the relationship between green innovation initiatives and environmental regulations in the process of environmental management and environmental performance in the industrial sector. To do so, the survey-based research methodology using PLS-SEM was adopted, and data was gathered from 279 managers working in the equipment manufacturing industry. Our empirical findings revealed that environmental regulation and green innovation efforts strengthen decarbonization efforts, which further improve environmental management and environmental performance. The mediating role of decarbonization efforts was found to be prominent among green process innovation, environmental management and environmental performance. Moreover, decarbonization serves as a mediator between green product innovation and environmental management. In contrast, we could not verify that decarbonization mediates the relationship between green product innovation and environmental performance. The key findings are greatly important and provide a fresh roadmap for environmental management in the post-COVID era.

Significance There are efforts to integrate the reduced carbon emissions from avoided deforestation claimed by voluntary REDD+ projects into national greenhouse gas emission inventories. This requires careful consideration of whether and how much of the reduced carbon emissions can be attributed to projects. However, credible evidence on the effectiveness of such voluntary activities is limited. We adopted the quasi-experimental synthetic control method to examine the causal effects of 12 voluntary REDD+ projects in the Brazilian Amazon. We compared these ex-post estimates of impacts with the reductions in forest loss claimed by those projects based on ex-ante baselines. Results suggest that the accepted methodologies for quantifying carbon credits overstate impacts on avoided deforestation and climate change mitigation.