scholarly journals Co-Movements between Eu Ets and the Energy Markets: A Var-Dcc-Garch Approach

Mathematics ◽  
2021 ◽  
Vol 9 (15) ◽  
pp. 1787
Author(s):  
Pilar Gargallo ◽  
Luis Lample ◽  
Jesús A. Miguel ◽  
Manuel Salvador
Keyword(s):  
Fossil Fuels ◽  
Spillover Effect ◽  
Warning System ◽  
Energy Transition ◽  
Clean Energy ◽  
Stock Index ◽  
Phase Iii ◽  
Response Analysis ◽  
Eu Ets ◽  
The Eu

This paper analyzes the co-movements of prices of fossil fuels, energy stock markets and EU allowances. This analysis is conducted in order to identify the spillover effect of volatility and correlation among these financial markets, and to provide a scientific basis that shows the interest of incorporating sustainable assets in the design of minimum risk strategies of investment. To achieve this goal, we have used a Vector Autoregressive-Dynamic Conditional Correlation-Generalized Autoregressive Conditional Heteroscedasticity (VAR-DCC-GARCH) model that also incorporates a stock index of industrial companies as a leading indicator of the level of economic activity. In addition, the paper conducts an impulse response analysis to determine how unexpected shocks to prices are propagated along time, and, in particular, how they affect prices of the others, both in mean, variance and correlation. Therefore, the results of this one- and two-dimensional analysis allow for the study of short and long run dynamics of the relationship among those prices, thus, providing greater meaning and information for investors, which has implications for building their portfolios. The analyzed period was from January 2010 to February 2021, so that the data include half of phase II, full phase III and the onset of phase IV of the EU ETS, as well as the COVID-19 outbreak in the European context. We also analyzed whether the EUA price impulses the demand of clean energy stocks, which has important implications for the objective of triggering the investment in clean energy. Our results show the transmission mechanism of all of those prices, which are relevant not only for investors but also for policymakers to construct an early-warning system, revealing the most important transmission channels. Moreover, from an investment viewpoint, we observe a decline in dirty energies and a rise in the clean energy market, which might be an indication of the progress towards the energy transition to renewables sources within a circular economy perspective. Therefore, this shows that the EU ETS is achieving its goals, and that clean energy companies, aligned with their role towards socially responsible initiatives, are also gaining acceptance in terms of investments, which would be beneficial for the environment.

scholarly journals The Spanish Energy Transition into the EU Green Deal: Alignments and Paradoxes

Energies ◽  
2021 ◽  
Vol 14 (9) ◽  
pp. 2535
Author(s):  
José Antonio Peña-Ramos ◽  
María del Pino-García ◽  
Antonio Sánchez-Bayón
Keyword(s):  
International Relations ◽  
Fossil Fuels ◽  
Fossil Fuel ◽  
Energy Transition ◽  
Clean Energy ◽  
Renewable Energies ◽  
Energy Relations ◽  
Current Energy ◽  
The Eu ◽  
Do So

Climate change, clean energy transition, the energy security quest, and international relations have triggered the revival of renewable energy as a solution to these problems. Nowadays, there is an energy transition where renewable energies bring geopolitical changes in a world where fossil fuels are becoming less relevant. This article aims to assess how the transition influences Spain’s energy relations with other countries regarding electricity and its sources, in alignment with the European Green Deal. In order to do so, its current energy situation, the renewable energies development and its energy import-export relations are examined. The results show that despite progress in green regionalization through more electric interconnection, little difference is to be found in traditional relations with fossil fuel countries exporters, but more are the contractions in Spanish energy economic policy, as here is explained.

scholarly journals French Energy Sector in Search for Optimal Model

2019 ◽  
Vol 12 (5) ◽  
pp. 156-171
Author(s):  
A. V. Zimakov
Keyword(s):  
Power Generation ◽  
Nuclear Power ◽  
Nuclear Reactors ◽  
Current Model ◽  
Energy Transition ◽  
Clean Energy ◽  
Green Energy ◽  
Electricity Production ◽  
Low Carbon ◽  
The Eu

Clean energy transition is one of major transformation processes in the EU. There are different approaches among EU countries to decarbonization of their energy systems. The article deals with clean energy transition in France with the emphasis on power generation. While this transformation process is in line with similar developments in the EU, the Franch case has its distinct nature due to nuclear power domination in electricity production there. It represents a challenge for the current model as the transition is linked to a sharp drop of nuclear share in the power mix. It is important to understand the trajectory of further clean energy transition in France and its ultimate model. The article reviews the historical roots of the current model (which stems from Messmer plan of the 1970-es) and its development over years, as well as assesses its drawbacks and merits in order to outline possible future prospects. The conclusion is that the desired reduction of nuclear energy is linked not solely to greening process but has a complex of reasons, the ageing of nuclear reactors being one of them. Nuclear power remains an important low-carbon technology allowing France to achieve carbon neutrality by 2050. A desired future energy model in France can be understood based on the analysis of new legislation and government action plans. The targeted model is expected to balance of nuclear and green energy in the generation mix in 50% to 40% proportion by 2035, with the rest left to gas power generation. Being pragmatic, French government aims at partial nuclear reactors shut down provided that this will not lead to the rise of GHG emissions, energy market distortions, or electricity price hikes. The balanced French model is believed to be a softer and socially comfortable option of low-carbon model.

Economic goals of Dubai and Abu Dhabi will diverge

2020 ◽  
Keyword(s):  
Soft Power ◽  
Fossil Fuels ◽  
Energy Transition ◽  
Clean Energy ◽  
Abu Dhabi ◽  
Property Market ◽  
Innovation Ecosystem ◽  
Sovereign Wealth Funds ◽  
Content Type ◽  
The Impact

Significance Despite its promotion of an innovation ecosystem to attract start-ups, Abu Dhabi has overall made little progress in addressing the impact of the clean-energy transition on long-term demand for fossil fuels. As COVID-19 hits private consumption hard, Dubai is promoting expatriate-friendly labour market and legal reforms, with an eye to the troubled real estate sector. Impacts Abu Dhabi’s sovereign wealth funds will increase their exposure to the overseas oil derivatives industry. Dubai will shift attention to taming oversupply in the flagging property market, and developers will be under increased scrutiny. Ambitious oil production targets will increase tensions with Saudi Arabia; a medium-term OPEC exit is possible. Abu Dhabi will prioritise high-profile space and nuclear projects that generate soft power and boost innovation.

scholarly journals Biomass Availability in Europe as an Alternative Fuel for Full Conversion of Lignite Power Plants: A Critical Review

Energies ◽  
2020 ◽  
Vol 13 (13) ◽  
pp. 3390 ◽  
Author(s):  
Vasiliki Tzelepi ◽  
Myrto Zeneli ◽  
Dimitrios-Sotirios Kourkoumpas ◽  
Emmanouil Karampinis ◽  
Antonios Gypakis ◽  
...  
Keyword(s):  
Supply Chain ◽  
Power Plants ◽  
Fossil Fuels ◽  
Clean Energy ◽  
Carbon Neutrality ◽  
Long Time ◽  
Biomass Availability ◽  
Phase Out ◽  
Full Conversion ◽  
The Eu

Biomass has been demonstrated as a capable source of energy to fulfill the increasing demand for clean energy sources which could last a long time. Replacing fossil fuels with biomass-based ones can potentially lead to a reduction of carbon emissions, which is the main target of the EU climate strategy. Based on RED II (revised Renewable Energy Directive 2018/2001/EU) and the European Green Deal, biomass is a promising energy source for achieving carbon neutrality in the future. However, the sustainable potential of biomass resources in the forthcoming decades is still a matter of question. This review aims at estimating the availability of biomass for energy reasons in the EU, and to evaluate its potential to meet the coal power plant capacity of the main lignite-producer countries, including Germany, Poland and Greece. Plants in line with the sustainability criteria of RED II have been selected for the preliminary estimations concerning their full conversion to the biomass power concept. Furthermore, the various barriers to biomass utilization are highlighted, such as the stranded asset risk of a future coal phase-out scenario, biomass supply chain challenges, biomass availability in main lignite-producer EU countries, the existing full conversion technologies, and biomass cost. A variety of challenges in the scenario of lignite substitution with biomass in a plant are investigated in a SWOT (strengths, weaknesses, opportunities, and threats) analysis. Technological risks and issues should be tackled in order to achieve the coal phase-out EU goal, mainly with regard to the supply chain of biomass. In this direction, the development of logistics centers for the centralized handling of biomass is strongly recommended.

scholarly journals The political logics of clean energy transitions

2018 ◽  
Vol 20 (4) ◽  
pp. 492-522 ◽  
Author(s):  
Hanna Breetz ◽  
Matto Mildenberger ◽  
Leah Stokes
Keyword(s):  
Political Institutions ◽  
Fossil Fuels ◽  
New Technologies ◽  
Energy Transition ◽  
Clean Energy ◽  
Political Conflict ◽  
The Political ◽  
Cost Curve ◽  
Low Carbon ◽  
Experience Curves

AbstractTechnology costs and deployment rates, represented in experience curves, are typically seen as the main factors in the global clean energy transition from fossil fuels towards low-carbon energy sources. We argue that politics is the hidden dimension of technology experience curves, as it affects both costs and deployment. We draw from empirical analyses of diverse North American and European cases to describe patterns of political conflict surrounding clean energy adoption across a variety of technologies. Our analysis highlights that different political logics shape costs and deployment at different stages along the experience curve. The political institutions and conditions that nurture new technologies into economic winners are not always the same conditions that let incumbent technologies become economic losers. Thus, as the scale of technology adoption moves from niches towards systems, new political coalitions are necessary to push complementary system-wide technology. Since the cost curve is integrated globally, different countries can contribute to different steps in the transition as a function of their individual comparative political advantages.

scholarly journals Are We on the Right Track? Collective Self-Consumption and Energy Communities in the European Union

2021 ◽  
Vol 13 (22) ◽  
pp. 12494
Author(s):  
Dorian Frieden ◽  
Andreas Tuerk ◽  
Ana Rita Antunes ◽  
Vasilakis Athanasios ◽  
Alexandros-Georgios Chronis ◽  
...  
Keyword(s):  
Renewable Energy ◽  
Electricity Market ◽  
National Level ◽  
Energy Transition ◽  
Clean Energy ◽  
Energy System ◽  
The European Union ◽  
High Expectations ◽  
The Right ◽  
The Eu

To accelerate the energy transition, the EU “Clean Energy for all Europeans” package aims to strengthen the involvement of end consumers in the energy market. To this end, together with so-called “active consumers” and provisions for individual and collective renewable energy self-consumption, two types of energy communities were introduced. The EU framework, however, leaves many details of the transposition process to the national level. The corresponding directives were supposed to be transposed by the end of December 2020 (recast Electricity Market Directive, defining active consumers and citizen energy communities) and by the end of June 2021 (Renewable Energy Directive, defining renewables self-consumption and renewable energy communities). In this paper, we critically discuss major developments of the transposition, including questions of the general distinction of the different concepts, governance and ownership, physical expansion, administrative barriers and the overall integration of energy communities into the energy system. The analysis builds on country case studies as well as on previous work by the authors on the status of the transposition process throughout the EU. The paper shows that the national approaches differ greatly and are at very different stages. While basic provisions are in place in most Member States to meet the fundamental EU requirements, the overall integration into the energy system and market is only partly addressed. This concerns, for instance, the analysis of system impacts of energy communities and measures that would allow and support energy system-friendly behaviour. In addition, several practical hurdles need to be overcome. These often relate to administrative requirements such as complex registration and licensing procedures, the need for the involvement of several institutions, or difficult procedures for access to relevant data. The paper concludes that discussed barriers will need to be carefully addressed if the high expectations for the role of energy communities are to be met.

scholarly journals Financial Aspects of the European Green Deal

2021 ◽  
pp. 13-23
Author(s):  
M. Strezhneva
Keyword(s):  
European Union ◽  
Energy Transition ◽  
Clean Energy ◽  
The European Union ◽  
Economic Activities ◽  
Public And Private ◽  
Financial Decisions ◽  
Environmental Objectives ◽  
The Usa ◽  
The Eu

The climate policy of the European Union became the key priority for the European Commission, headed by Ursula von der Leyen. This article analyses both its internal and external dimensions, while concentrating on the finances of the European Green Deal, the multiyear strategy for the EU socio-economic development. The methods are demonstrated which the EC employs to mobilize public and private capital for the realization of the green transit, including the financial instruments designed to assist businesses when investing in clean energy and industry. The notion of ‘sustainable’ investment is specified that Brussels is guided by when working out its financial decisions. The EU taxonomy, a green classification system that translates the EU's climate and environmental objectives into criteria for specific economic activities for investment purposes, is presented. The research reveals how the market and regulatory powers of the EU are brought to bear in rolling out its controversial Carbon Border Adjustment Mechanism. By means of this transnational taxation Brussels hopes to avoid carbon leakage: the situation that allegedly may occur if European carbon-intensive businesses were to transfer production to other jurisdictions with laxer emission constraints. Yet a lack of flexibility in applying the CBAM is causing concern in many countries of the world, including the USA, Brazil, South Africa and China. In EU-Russia relations in particular, it risks increasing political tensions and/or causing trade retaliation due to low levels of mutual trust. Russia developing energy transition plans of her own, her efforts in this respect are now visibly stimulated by the declared EU intention to externalize its regulatory practices. At the same time, Moscow perceives this externalization as an imposition which is most unwelcome and hurts Russia disproportionally. Presumably, the European Union could put more effort in negotiating and developing this latest European initiative with international partners to win new willing ears for it.

scholarly journals Waste-to-Energy in the EU: The Effects of Plant Ownership, Waste Mobility, and Decentralization on Environmental Outcomes and Welfare

2020 ◽  
Vol 12 (14) ◽  
pp. 5743 ◽  
Author(s):  
Laura Levaggi ◽  
Rosella Levaggi ◽  
Carmen Marchiori ◽  
Carmine Trecroci
Keyword(s):  
Fossil Fuels ◽  
Consumer Preferences ◽  
Clean Energy ◽  
Waste To Energy ◽  
Chemical Waste ◽  
Disposal Option ◽  
The Relationship ◽  
Energy From Waste ◽  
The Eu

Waste-to-energy (WtE) could prevent the production of up to 50 million tons of CO2 emissions that would otherwise be generated by burning fossil fuels. Yet, support for a large deployment of WtE plants is not universal because there is a widespread concern that energy from waste discourages recycling practices. Moreover, incineration plants generate air pollution and chemical waste residuals and are expensive to build compared to modern landfills that have appropriate procedures for the prevention of leakage of harmful gasses. In the context of the EU, this paper aims to provide a picture of the actual role of WtE as a disposal option for municipal solid waste (MSW), enabling it to be utilized as a source of clean energy, and to address two important aspects of the debate surrounding the use of WtE; namely, (i) the relationship between WtE and recycling, and (ii) the effects of decentralization, waste mobility, and plant ownership. Finally, it reviews the role of the EU as a supranational regulator, which may allow the lower government levels (where consumer preferences are better represented) to take decisions, while taking spillovers into account.

Multiscale interplay of higher-order moments between the carbon and energy markets during Phase III of the EU ETS

Energy Policy ◽  
2021 ◽  
Vol 156 ◽  
pp. 112428
Author(s):  
Xingyu Dai ◽  
Ling Xiao ◽  
Qunwei Wang ◽  
Gurjeet Dhesi
Keyword(s):  
Energy Markets ◽  
Higher Order ◽  
Phase Iii ◽  
Eu Ets ◽  
Higher Order Moments ◽  
The Eu
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