Special Issue of Energy Economics

The latest issue of Energy Economics is a special issue on the economics of technologies to combat global warming. I haven't read the papers in detail yet, but there look to be several good overviews of the current state of play on the key issues in this area. Given the slowness with which countries are moving to put a price on greenhouse gas emissions, technology policies might end up being more

Why "Jevons Paradox" is an Argument for Stronger Action on Climate Change not Weaker

The 19th century economist William Jevons suggested that improvements in the efficiency of energy use devices could increase energy use rather than reduce it. The more efficient machines etc. would reduce the cost of production thereby increasing the amount demanded and sold and, therefore, the energy used to produce the products. The rebound effect is a modern statement of this idea: "Efficiency

Artificial Photosynthesis

Interesting innovation - solar furnace that uses sunlight to convert carbon dioxide and water to carbon monoxide and hydrogen. These are necessary inputs in the Fischer-Tropsch process of synthesizing liquid hydrocarbons. So, this is effectively artificial photosynthesis. At the moment, the efficiency is no better than plant-based photosynthesis and the reactors would be more expensive than

Porsche Develops Hybrid Technology

I blogged about the development of hybrid cars by BMW and Mercedes when I was visiting Munich. My point was that fuel economy standards were forcing luxury car makes to adopt hybrid technology. I saw this as a route to wider adoption of hybrid technology in mass-market cars. Non-luxury hybrids seem so far to only appeal to "green consumers" willing to pay a premium for lower fuel consumption.

Tsao & Waide: "The World’s Appetite for Light"

Following up yesterday's post I looked at the study that provided the background for the paper studied there:Jeffrey Y. Tsao and Paul Waide:"The World’s Appetite for Light: Empirical Data and Trends Spanning Three Centuries and Six Continents"LEUKOS VOL 6 NO 4 APRIL 2010 PAGES 259 – 281This paper gives a figure of per capita light consumption and GDP/cost of light:I drew the thick black line on

Will the Adoption of Solid State Lighting Lead to an Increase in Energy Use?

The Economist discusses an article in Journal of Physics D: Applied Physics by Tsao et al. on the effects on energy use of the adoption of solid state (i.e. LED) lighting (SSL) on global energy use. The Economist argues that it would be better to keep incandescent bulbs as a result. This seems a bit crazy. The literature on the rebound effect suggests that for energy saving innovations for

Role of Fuel Economy Standards in Effecting Technological Change

I was fascinated to learn yesterday that Mercedes has paid the US government $300 million in fines due to violating the CAFE standards. As fuel economy standards continue to rise manufacturers will need to find innovative ways to reduce the fuel consumption of their luxury and sports models in order to end up with acceptable cross-fleet mean fuel consumption figures. The interesting thing is that

The Environment and Directed Technical Change: Acemoglu et al.

Acemoglu, Aghion, Bursztyn, and Hemous put out an interesting NBER Working Paper last October. The abstract is below. They carry out a simulation which shows that a carbon tax alone is significantly inferior in terms of loss of consumption to a combination of a carbon tax and clean technology development subsidy. Results depend on the elasticity of substitution between dirty and clean inputs and

Innovation and Energy Efficiency

Changes in the energy/GDP ratio that are not related to changes in the relative price of energy are called changes in the autonomous energy efficiency index (AEEI, Kaufmann, 2004). These could be due to any of the determinants of the relationship between energy and output listed at the beginning of this section and not just technological change. Even A in (3) is just general TFP and, therefore,

Neoclassical Growth Models with Resources and Technical Change

Another installment. I'm more uncertain about whether I'm getting the story right here. So comments are even more welcome. I've had none so far :(Growth Models with Resources and Technical ChangeIn addition to substitution of capital for resources, technological change might permit growth or at least constant consumption in the face of a finite resource base. Stiglitz (1974a) showed that in a

The Rebound Effect

The latest episode. Comments please.The Rebound EffectThe Khazzoom-Brookes Postulate (Brookes, 1990; Khazzoom, 1980, Berkhout et al., 2000), or "rebound effect," argues that energy saving innovations induce an increase in energy consumption that offsets the technology derived saving. Rebound effects can be defined for energy saving innovations in consumption and production. A consumer consumes

Crucial Assumptions

"All theory depends on assumptions which are not quite true. That is what makes it theory. The art of successful theorizing is to make the inevitable simplifying assumptions in such a way that the final results are not very sensitive. A "crucial" assumption is one on which the conclusions do depend sensitively, and it is important that crucial assumptions be reasonably realistic. When the results