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Abstract In this paper, we analyze the rationale for an energy policy mix when the European Emissions Trading Scheme (ETS) is considered from a public choice perspective. That is, we argue that the economic textbook model of the ETS implausibly assumes (1) efficient policy design and (2) climate protection as the single objective of policy intervention. Contrary to these assumptions, we propose that the ETS originates from a political bargaining game within a context of multiple policy objectives. In particular, the emissions cap is negotiated between regulators and emitters with the emitters' abatement costs as crucial bargaining variable. This public choice view yields striking implications for an optimal policy mix comprising RES supporting policies. Whereas the textbook model implies that the ETS alone provides sufficient climate protection, our analysis suggests that support for renewable energies (1) contributes to a more effective ETS-design and (2) may even increase the overall efficiency of climate and energy policy if other externalities and policy objectives besides climate protection are considered. Thus, our analysis also shows that a public choice view not necessarily entails negative evaluations concerning efficiency and effectiveness of a policy mix.

Most of the climate change models for South Africa predict a reduction in freshwater availability by 2050, which implies that water availability for sectoral production activities is expected to decline. This decline has an impact on sectoral output, value added and households’ welfare. Using a computable general equilibrium approach, this study investigates the possible impact of global change on households’ welfare. The simulation results show that water scarcity due to global change can potentially lead to a general deterioration in households’ welfare. The poor households, whose incomes are adversely impacted, are the most vulnerable to the consequences of the impact of global change on water resources in South Africa. This vulnerability can only be reduced if welfare policies that maintain food consumption levels for the least and low-income households are implemented

In the agricultural sector, climate change (CC) affects multiple weather variables at different stages of crop cycles. CC may influence the mean level or affect the distribution of events (e.g., rainfall, temperature). This work evaluates the economic impact of CC-related changes in multiple climatic components, and the resulting uncertainty. For this purpose, a three-stage discrete stochastic programming model is used to represents farm sector of an irrigated area of Italy and to examine the influence of CC on rainfall and on maximum temperature. These variables affect the availability of water for agriculture and the water requirements of irrigated crops. The states of nature, and their change, are defined more broadly than in previous analyses; this allows examining the changes of more climatic variables and crops cultivation. The effect of CC is obtained by comparing the results of scenarios that represent the climatic conditions in the current situation and in the future. The results show that the agricultural sector would seek to lower costs by modifying patterns of land use, farming practices and increasing the use groundwater. The overall economic impact of these changes is small and due primarily to the reduced availability of water in the future. The temperature increase is, in fact, largely offset by the effects of the increase in CO2 levels, which boosts the yield of main crops of the irrigated zone. Therefore, availability and water management becomes a crucial factor to offset the increase of evapotranspiration and of water stress resulting from the increase of temperature. However, the costs of CC are very high for some types of farming, which suffer a large reduction in income.

This study explores the impact of oil depletion on the energetic efficiency of oil extraction and refining in California. These changes are measured using energy return ratios (such as the energy return on investment, or EROI). I construct a time-varying first-order process model of energy inputs and outputs of oil extraction. The model includes factors such as oil quality, reservoir depth, enhanced recovery techniques, and water cut. This model is populated with historical data for 306 California oil fields over a 50 year period. The model focuses on the effects of resource quality decline, while technical efficiencies are modeled simply. Results indicate that the energy intensity of oil extraction in California increased significantly from 1955 to 2005. This resulted in a decline in the life-cycle EROI from 6.5 to 3.5 (measured as megajoules (MJ) delivered to final consumers per MJ primary energy invested in energy extraction, transport, and refining). Most of this decline in energy returns is due to increasing need for steam-based thermal enhanced oil recovery, with secondary effects due to conventional resource depletion (e.g., increased water cut).

We explore an input–output based framework for optimizing production in the Greek economy, under constraints relating to energy use, final demand, greenhouse gas emissions and solid waste. Using empirical data, we consider the effects on the maximum attainable gross value of production when imposing various pollution abatement targets. Our results quantify those effects as well as the magnitude of economic sacrifices required to achieve environmental goals, in a series of policy scenarios of practical importance. Because air pollution and solid waste are not produced independently of one another, we identify the settings in which it is meaningful to institute a separate policy for mitigating each pollutant, versus those in which only one pollutant needs to be actively addressed. The scenarios considered here represent a range of options that could be available to policy makers, depending on the country's international commitments and the effects on economic and environmental variables.

Waste with high biomass content generated in cities in developing countries is sent to landfills or open dumps. This research aims to degrade biomass content in urban waste through cultivation, at pilot scale, of the edible mushroom Pleurotus ostreatus. First, the number of diapers used by one baby per week was measured with a survey in day care facilities. Then, cellulose content of diapers was assessed. Finally, cultivation of P. ostreatus was carried out using as substrate a mixture of diapers with gardening waste, a co-substrate readily available at urban settings. The factors assessed were strain of P. ostreatus (grey BPR-81, white BPR-5), conditioning of the substrate (diapers with and without plastic) and co-substrate (wheat straw, grass, and withered leaves). Results show that diapers are a valuable source of biomass, as generation of diapers with urine is 15.3 kg/child/month and they contain 50.2% by weight of cellulose. The highest reductions in dry weight and volume (>64%) of substrates was achieved with the substrate diaper without plastic and co-substrate wheat straw. Although diapers with plastic and grass and leaves showed lower degradation, they achieved efficiencies that make them suitable as a co-substrate (>40%), considering that their biomass is currently confined in landfills.

This paper develops further a model of the economic process, first set out as part of a paper by the author in 2007, concerning the application of thermodynamic laws to economics. The paper sets out relationships between economic output and capital, labour, resource and waste stocks, with specific reference to energy, and is backed up analysis of data of world energy resources and climate change. The paper conculdes that both energy resource availability and climate change will have significant, limiting effects on the forward path of world economic developoment.

AbstractSlowing climate change will almost certainly require a reduction in greenhouse gas emissions, but agreement on who should reduce emissions by how much is difficult, in part because of the self-serving bias—the tendency to believe that what is beneficial to oneself is also fair. Conducting surveys among college students in the United States and China, we show that each of these groups displays a nationalistic self-serving bias in judgments of a fair distribution of economic burdens resulting from mitigation. Yet, we also show, by disguising the problem and the identity of the parties, that it is possible to elicit perceptions of fairness that are not influenced by national interests. Our research reveals that the self-serving bias plays a major role in the difficulty of obtaining agreement on how to implement emissions reductions. That is, the disagreement over what constitutes fair climate policy does not appear to be due to cross-national differences in what constitutes a fair distribution of burdens. Interventions to mitigate the self-serving bias may facilitate agreement.