http://www.rssboard.org/rss-specification 720 https://escholarship.org/uc/ucei_policy/rss Recent eScholarship items from Policy and Economics Fri, 15 May 2026 17:01:09 +0000 https://escholarship.org/uc/item/7xg1t4ch <p>This paper provides the first systematic analysis of the choice by organizations to occupy green office space. We develop a framework of ecological responsiveness, and we formulate five propositions to explain why specific firms and industries may be more likely to lease green space. We test these propositions by analyzing the decisions of more than 11,000 tenants to choose office space in green buildings or in otherwise comparable non-green buildings located nearby. We find that corporations in the oil and banking industries, as well as government-related and non-profit organizations, are among the most prominent green tenants. After appropriately controlling for building quality and for location within one quarter mile, our empirical analysis shows that firms in mining and construction and organizations in public administration are relatively more likely to lease green rather than conventional office space. Furthermore, organizations employing higher levels of human capital... https://escholarship.org/uc/item/7xg1t4ch Wed, 16 Sep 2009 00:00:00 +0000 Eichholtz, Piet Kok, Nils Quigley, John M. https://escholarship.org/uc/item/56b1j52f <p>The global petroleum system is undergoing an “oil transition,” shifting from conventionally produced petroleum to a suite of substitutes for conventional petroleum (SCPs). This paper describes the Regional Optimization Model for Emissions from Oil Substitutes, or ROMEO, which models this oil transition. ROMEO models the dynamics of the transition to substitutes for oil and the environmental impacts (greenhouse gas (GHG) intensity) of such a transition. It models the global liquid fuel market in an optimization framework. The ROMEO market mechanism operates differently than “perfect foresight” models: it solves each year sequentially, with each year optimized under uncertainty about future prevailing prices or resource quantities.</p><p>ROMEO includes more fuel types than models designed for integrated assessments of climate change. ROMEO also includes the differing carbon intensities and costs of production of these fuel types. We use ROMEO to calculate the uncertainty of future... https://escholarship.org/uc/item/56b1j52f Mon, 20 Oct 2008 00:00:00 +0000 Brandt, Adam R. Farrell, Alexander E. https://escholarship.org/uc/item/4g746523 <p>In response to Assembly Bill 32, the State of California is considering three types of carbon emissions trading programs for the electric power sector: load-based, source-based, and first-seller. They differ in terms of their point-of-regulation, and in whether in-state-to-out-of-state and out-of-state-to-in-state electricity sales are regulated. In this paper, we formulate a market equilibrium model for each of the three approaches, considering power markets, transmission limitations, and emissions trading, and making the simplifying assumption of pure bilateral markets. We analyze the properties of their solutions and show the equivalence of load-based, first-seller and source-based approaches, when power sales in both directions are regulated under the cap. A numeric example illustrates the emissions and economic implications of the models. In the simulated cases, "leakage" eliminates most of the emissions reductions that the regulations attempt to impose. Further, "contract... https://escholarship.org/uc/item/4g746523 Mon, 20 Oct 2008 00:00:00 +0000 Chen, Yihsu Liu, Andrew L. Hobbs, Benjamin F. https://escholarship.org/uc/item/3fg2r29s <p>This paper examines the factors responsible for changes in crude oil prices. The paper reviews the statistical behavior of oil prices, relates these to the predictions of theory, and looks in detail at key features of petroleum demand and supply. Topics discussed include the role of commodity speculation, OPEC, and resource depletion. The paper concludes that although scarcity rent made a negligible contribution to the price of oil in 1997, it may be an important feature of the most recent data.</p> https://escholarship.org/uc/item/3fg2r29s Mon, 20 Oct 2008 00:00:00 +0000 Hamilton, James Douglas https://escholarship.org/uc/item/8v9458m0 <p>Personal computers (PCs) are one of the most ubiquitous and indispensable electronic devices in use within California’s homes and businesses. More PCs are estimated to be in use in California than in any other U.S. state. According to the latest published estimates from U.S. Department of Energy (DOE), 11.5 million PCs were installed in California’s homes (as of 2001) and 6.5 million PCs were installed in California’s commercial buildings (as of 2003) (U.S. DOE 2003, 2006a). Based on these DOE data and recent PC sales data, it was estimated in this research project that as of 2005 nearly 19 million PCs were installed in California homes and businesses and that this number is expected to grow significantly through 2012.</p><p>This research project focused on evaluating a set of realistic measures aimed at reducing the life-cycle energy use and GHG emissions associated with operating and maintaining California’s residential and commercial PC stock (hereafter referred to simply... https://escholarship.org/uc/item/8v9458m0 Wed, 14 Feb 2007 00:00:00 +0000 Horvath, A Masanet, Eric https://escholarship.org/uc/item/8fj103fv <p>Observers of restructured electricity markets emphasize: (1) Spot prices are extremely variable, because electricity is not storable; (2) long-dated forward markets rarely exist – those in California were a single day ahead. Actually, the first observation implies the second. With the aid of a simulation model, which replicates the seasonality, heteroskedasticity, and serial correlation in load, the precise constellations of forward prices can be deduced in a setting of perfect competition, risk neutrality, and best possible forecasting. Even at extreme conditions in the idealized spot market, the constellations of these forward prices converge to long-run seasonal means at the horizon of just a few days. Another reason long-dated forward markets for electricity are redundant is the futures market for natural gas on NYMEX, functioning at a horizon beyond two years, as demonstrated by analyses of forecasting power using the simulation data as well as the data from NYMEX and... https://escholarship.org/uc/item/8fj103fv Wed, 14 Feb 2007 00:00:00 +0000 Suenaga, Hiroaki Williams, Jeffrey https://escholarship.org/uc/item/7bh5f7rn <p>Electricity mergers pose distinctive challenges for competition policy - in market definition and for modelling price impacts in markets with no storage, inelastic short-run demand and transmission constraints. FERC’s pivotal supply test for screening mergers is an improvement on market shares, but still potentially misleading. We counter-propose competitive residual demand analysis. The EU is poorly placed to deal with domestic mergers that impact external energy flows. The paper argues that vertical (convergent) mergers between electricity and gas raise additional concerns, given current EU gas market power, exemplified by the E.On-Ruhrgas merger. The form of the Emissions Trading System amplifies these concerns.</p> https://escholarship.org/uc/item/7bh5f7rn Wed, 14 Feb 2007 00:00:00 +0000 Gilbert, Richard J Newberry, David M https://escholarship.org/uc/item/4bz9j4wr <p>A model of two-settlement electricity markets is introduced, which accounts for flow congestion, demand uncertainty, system contingencies and market power. We formulate the subgame perfect Nash equilibrium for this model as an equilibrium problem with equilibrium constraints (EPEC), in which each firm solves a mathematical program with equilibrium constraints (MPEC). The model assumes linear demand functions, quadratic generation cost functions and a lossless DC network, resulting in equilibrium constraints as a parametric linear complementarity problem (LCP). We introduce an iterative procedure for solving this EPEC through repeated application of an MPEC algorithm. This MPEC algorithm is based on solving quadratic programming sub-problems and on parametric LCP pivoting. Numerical examples demonstrate the effectiveness of the MPEC and EPEC algorithms and the tractability of the model for realistic size power systems.</p> https://escholarship.org/uc/item/4bz9j4wr Wed, 14 Feb 2007 00:00:00 +0000 Yao, Jian Adler, Ilan Oren, Shmuel S https://escholarship.org/uc/item/1v97n5k6 <p>This paper outlines a strawman proposal for ensuring electricity supply adequacy by means of contracting obligations imposed on load serving entities (LSE). The mandatory contracts take the form of physically covered back stop call options with a high strike price so as not to interfere with normal risk management practices. These call options which can be covered by existing capacity, new investment in generation, or curtailable load contracts are of one year duration and a two year lead time so as to enable new entrant participation. The obligation, which is based on forecasted peak load plus adequate planning reserves, can be met with any forward or option contract that meets the physical cover requirement, has the same delivery period, and has a strike or forward price at or below the backstop strike price. The proposed mechanisms is intended to facilitate smooth transition to an energy only market where voluntary bilateral contracting and spot prices provide the needed... https://escholarship.org/uc/item/1v97n5k6 Wed, 14 Feb 2007 00:00:00 +0000 Oren, Shmuel S https://escholarship.org/uc/item/19h474cb <p>We present an empirical analysis of a supply function equilibrium model in the Texas spot electricity market. We derive condititions for optimal bidding behavior in a spot market with ex ante bilaterally contracted sales. By using generation cost information, we are able to derive a set of ex post- and ex ante-optimal supply functions and use a nonparametric model of firm behavior to compare our theoretically-optimal supply functions to actual offers made in years 2002 and 2003. Our results show that with markups and markdowns far in excess of what a model of profit-maximizing behavior suggests. For small generators, municipalities, and cogenerators we find evidence suggesting these firms may be acting to exclude themselves from the market by economically witholding their generation.By using partial-linear behavior model we demonstrate some learning effects to have taken place during the first quarter of 2002.</p> https://escholarship.org/uc/item/19h474cb Wed, 14 Feb 2007 00:00:00 +0000 Sioshansi, Ramteen Oren, Shmuel S https://escholarship.org/uc/item/5nd825w4 <p>Do natural gas storage decisions in California respond to futures price spreads? Daily data about flows into and out of storage facilities in California over 2001-2005 and daily price spreads on NYMEX are used to investigate whether the net injection profile is consistent with the “supply-of-storage” curve first observed for wheat by Holbrook Working. Storage decisions in California do seem to be influenced by intertemporal signals on NYMEX, but the effect is small. Strong seasonal and weekly cycles determine the net injection profile to a considerable extent. Regulatory requirements and operational constraints also limit the size of the response to intertemporal arbitrage opportunities. Results are surprisingly sensitive to the degree of aggregation.</p> https://escholarship.org/uc/item/5nd825w4 Mon, 26 Sep 2005 00:00:00 +0000 Uria, Rocio Williams, Jeffrey https://escholarship.org/uc/item/1h6141nj <p>We estimate the rebound effect for motor vehicles, by which improved fuel efficiency causes additional travel, using a panel of US states for 1966-2001. Our model accounts for endogenous changes in fuel efficiency, distinguishes between autocorrelation and lagged effects, includes a measure of the stringency of fuel-economy standards, and interacts the rebound effect with income. At sample averages of variables, our 3SLS estimates of the short- and long-run rebound effect are 4.7% and 22.0%. But they decline substantially with income: with variables at 1997-2001 levels they become 2.6% and 12.1%, considerably smaller than typically assumed for policy analysis.</p> https://escholarship.org/uc/item/1h6141nj Mon, 26 Sep 2005 00:00:00 +0000 Small, Kenneth A Van Dender, Kurt https://escholarship.org/uc/item/7kd0f0c5 <p>This paper analyzes how economic deregulation impacts resource reconfiguration in the electric utility industry. We argue that to understand strategic change in this industry, we need to understand how development and deployment of a firm’s resources reflects path dependencies that nonmarket actors impose on firms. We find evidence that the deregulation introduced to this historically staid industry has stimulated environmental differentiation strategies for incumbent firms. Consistent with theories that suggest differentiation is most likely to appear where its point of uniqueness is valued by customers, utilities engaged in differentiation if they served states whose populace exhibited a higher level of environmental sensitivity. The tendency for firms to differentiate is lessened if they are relatively more dependent on coal-fired generation or relatively more efficient. In both of these cases, the variables are associated with lower operating costs, in turn demonstrating... https://escholarship.org/uc/item/7kd0f0c5 Tue, 26 Apr 2005 00:00:00 +0000 Delmas, Magali Russo, Michael V. Montes-Sancho, Maria J. https://escholarship.org/uc/item/8zk9d9sb <p>The debate concerning the impacts of urban land use density on travel in general, and on residential vehicle use and fuel consumption in particular, lacks reliable quantitative evidence. The 2001 U.S. National Household Transportation Survey (NHTS) provides information on vehicle miles of travel (VMT) based on odometer data, as well as annual fuel usage computations based on information about the make, model and vintage of all household vehicles. In addition, the 2001 NHTS has been augmented with land use variables in the form of densities of population and residences at the census tract and block level for each of the more than 69,000 households in the dataset. In order to obtain unbiased estimates of the effects of any of these land use variables on annual VMT and fuel consumption the authors present a model system that accounts for both self selection effects and missing data that are related to the endogenous variables. Results for the State of California show that the... https://escholarship.org/uc/item/8zk9d9sb Tue, 29 Mar 2005 00:00:00 +0000 Golob, Thomas F. Brownstone, David https://escholarship.org/uc/item/7k19s9n4 <p>Offshore oil drilling has been controversial in California for decades. Oil drilling in national forests has never received the same kind of attention, but because of the Bush administration’s decision to increase oil development in the national forests, attention is likely to increase. This paper examines public opinion regarding oil drilling in California’s forests. We find that attitudes toward drilling for oil in national forests are similar to attitudes toward offshore oil drilling. This implies that oil drilling in the national forests can easily develop into a national controversy.</p> https://escholarship.org/uc/item/7k19s9n4 Tue, 29 Mar 2005 00:00:00 +0000 Smith, Eric R.A.N. Carlisle, Juliet Michaud, Kristy https://escholarship.org/uc/item/744256hh <p>Substantial benefits may arise from road pricing through its effects on the speed and service frequency of public transport. These effects are examined using a stylized model of local bus transport in a city center, a model requiring only a few parameters to obtain quantitative estimates. The model highlights four considerations: the cost savings to users and operators due to reduced road congestion; the service improvements made feasible by increased ridership; the potential passthrough of operator cost savings (even after paying for service improvements) as fare reductions; and the resulting multiplier effects on ridership and service offerings. The model is applied to central London using data from the first few months of the congestion charging program implemented in February 2003. Simulation results suggest significant effects, even if the pricing revenues had not been used to augment the public transport budget as they were in London: a ridership increase of 11 percent,... https://escholarship.org/uc/item/744256hh Tue, 29 Mar 2005 00:00:00 +0000 Small, Kenneth A. https://escholarship.org/uc/item/8tq6z6t0 <p>This paper discusses alternative approaches that have been adopted around the world for guaranteeing the appropriate level of investment in electric generation capacity. We argue that long term reserves should be viewed as price insurance and be treated as a private good. However, political realities and asymmetries and distortions in risk management incentives may necessitate imposition of mandatory levels of such insurance on load serving entities. Furthermore, centralized markets may be needed as a supplement to bilateral contracting in order to facilitate efficient procurement of such insurance and to bridge the gap between the needs of generators and load serving entities with regard to duration of hedging instruments. We discuss the origins and shortcomings of capacity payments and capacity obligations and explain how long term supply contracts in the form of call options with premiums that depend on the contracts' strike prices can meet the need for ensuring supply adequacy... https://escholarship.org/uc/item/8tq6z6t0 Thu, 8 Apr 2004 00:00:00 +0000 Oren, Shmuel S. https://escholarship.org/uc/item/7x04g2md <p>This paper is an empirical assessment of the comparative efficiency of governance structures in an environment marked by high uncertainty. We analyze the short-term impact of retail deregulation on the productive efficiency of electric utilities in the United States. We argue that there are transitory costs linked to the process of deregulation. The business strategy literature suggests different governance structures to cope with uncertainty linked to changing regulatory environments. Transaction cost economics suggests that firms may reduce their exposure to the uncertainty created by the process of deregulation by adopting vertical integration strategies. Organizational scholars on the contrary argue that firms vertically disintegrate and adopt flexible governance structures to increase their adaptability to the new conditions. Our empirical analysis is based on 177 investor-owned electric utilities representing 83% of the total U.S. electricity production by utilities from... https://escholarship.org/uc/item/7x04g2md Thu, 8 Apr 2004 00:00:00 +0000 Delmas, Magali Tokat, Yesim https://escholarship.org/uc/item/77z7z8bk <p>System operators in the electricity industry are required to procure reserve capacity to deal with unanticipated outages, demand shocks, and transmission constraints. One traditional method of procuring reserves is through a separate capacity auction with two-part bids. We analyze an alternative scheme whereby reserves are procured through the energy market using only energy bids, and capacity payments are made based on a generator's implied opportunity cost. By using the revelation principle, we are able to derive the equilibrium bidding function in this market and show that generators have a clear incentive to understate their costs in order to capture higher capacity rents. We then give a numerical example for a special case and examine the effect of the equilibrium bidding behavior on the generators' total revenues and on the energy payments.</p> https://escholarship.org/uc/item/77z7z8bk Thu, 8 Apr 2004 00:00:00 +0000 Oren, Shmuel S. Sioshansi, Ramteen https://escholarship.org/uc/item/3v30p0wh <p>In every energy crisis the U.S. has faced—beginning with the first crisis in 1973—we have seen a common sequence of events, which has been labelled the “energy crisis cycle” (Smith 2002). The steps in the cycle are: (1) When the demand for energy exceeded the supply, energy prices rose sharply — starting the energy crisis cycle. (2) Along with increases in energy prices came large increases in the profits of energy producers. (3) Politicians and interest group advocates criticized the energy industry for their greed in profiting at other people’s misfortune, and charged them with manipulating prices to increase profits. Some critics even claimed that the energy industry fabricated the energy crisis to increase profits. (4) Most of the public believed the industry critics. They did not accept claims that the energy crisis was real, and so they felt justified in demanding that the government fix the problem without any cost to the public. (5) In response to public demands, some... https://escholarship.org/uc/item/3v30p0wh Thu, 8 Apr 2004 00:00:00 +0000 Smith, Eric R.A.N. Carlisle, Juliet Michaud, Kristy https://escholarship.org/uc/item/3mn4v2r5 <p>This report describes Californians’ opinions about offshore oil and gas development. The report begins by describing the trends in support for offshore drilling since 1977. It then focuses on explaining the surge of support for offshore oil drilling that accompanied the rapid increase in gasoline prices in 2000 and 2001. In this report, we present data from a series of public opinion polls of Californians, which were conducted between 1977 and 2001. The surveys were conducted by the Field Institute, a nonpartisan, not-for-profit public opinion research organization established by the Field Research Corporation. The samples were representative cross-sections of California adults with sample sizes ranging from 485 to 1,034 (See the data appendix for details). We should also note that this study updates some of the information published in a previous MMS report, Trends in Public Opinion on Offshore Oil Development in California (Smith 1995), and in the recently published book,... https://escholarship.org/uc/item/3mn4v2r5 Thu, 8 Apr 2004 00:00:00 +0000 Smith, Eric R.A.N. https://escholarship.org/uc/item/5cg3d8q0 <p>We use a panel database of rate reviews conducted for U.S. electric utilities to assess how consumer advocates and elected Public Utility Commission heads affect regulatory policy and utility strategy. We find first that utilities postpone rate reviews in states with consumer advocates and elected commissioners. Second, we find that, after controlling for observed and unobserved state characteristics, states with consumer advocates and elected commissioners tend to grant lower returns on equity. Third, these institutions have differential impacts on different types of consumer: consumer advocates are associated with higher residential-industrial rate ratios while elected commissioners are associated with lower residential-industrial rate ratios.</p> https://escholarship.org/uc/item/5cg3d8q0 Fri, 13 Dec 2002 00:00:00 +0000 Holburn, Guy L. F. Spiller, Pablo T. https://escholarship.org/uc/item/0wj3x8bm <p>This paper develops an analytical framework to assess the second-best optimal level of gasoline taxation taking into account unpriced pollution, congestion, and accident externalities, as well as interactions with the broader fiscal system. We provide calculations of the optimal taxes for the US and the UK under a variety of parameter scenarios.</p><p>Under our central parameter values, the second-best optimal gasoline tax is $1.01/gal for the US and $1.34/gal for the UK. Current tax rates are much lower than this in the US and higher in the UK. The calculations are moderately sensitive to alternative parameter assumptions. The congestion externality is the largest component in both nations; revenue-raising needs also play a significant role, as do accident externalities and local air pollution.</p><p>Potential welfare gains from reducing the current UK tax rate are estimated at nearly one-fourth the production cost of all gasoline used in the UK. Even larger gains could be... https://escholarship.org/uc/item/0wj3x8bm Fri, 13 Dec 2002 00:00:00 +0000 Parry, Ian W. H. Small, Kenneth A. https://escholarship.org/uc/item/25w067h7 <p>We ask under what conditions transmission contracts increase or mitigate market power. We show that the allocation process of transmission rights is crucial. In an efficiently arbitraged uniform price auction generators will only obtain contracts that mitigate their market power. However, if generators inherit transmission contracts or buy them in a 'pay-as-bid' auction, then these contracts can enhance market power. In the two-node network case banning generators from holding transmission contracts that do not correspond to delivery of their own energy mitigates market power. Meshed networks differ in important ways as constrained links no longer isolate prices in competitive markets from market manipulation. The paper suggests ways of minimising market power considerations when designing transmission contracts.</p> https://escholarship.org/uc/item/25w067h7 Tue, 5 Nov 2002 00:00:00 +0000 Gilbert, Richard Neuhoff, Karsten Newberry, David