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The Adoption of Energy Efficiency Enhancing Technologies

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Author Info
Erik Verhoef ()
Peter Nijkamp () (Vrije Universiteit Amsterdam)

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Abstract

This paper analyses the adoption of energy-efficiency enhancing technologies by heterogeneous firms. The fact that energy use does not only cause external environmental costs through pollution, but also directly affects the profitability of the firm and hence its behaviour on input and output markets is taken for granted. It is demonstrated that the consideration of such market processes may have important implications for the efficiency of environmental policies concerned with energy use. The analysis focuses in particular on the efficiency of the market-led adoption and diffusion process under various policy regimes. It is shown that the promotion of energy-efficiency enhancing technologies might have unexpected effects in that it could lead to an increase in energy use, while the use of energy taxes might actually reduce the attractiveness of energy-saving technologies.

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Publisher Info
Paper provided by Tinbergen Institute in its series Tinbergen Institute Discussion Papers with number 97-077/3.

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Date of creation: 02 Aug 1997
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Handle: RePEc:dgr:uvatin:19970077

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Web page: http://www.tinbergen.nl/

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Related research
Keywords: environmental regulation; energy; adoption of technologies; heterogeneous firms; externalities;

Other versions of this item:

Find related papers by JEL classification:
D62 - Microeconomics - - Welfare Economics - - - Externalities
Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
O33 - Economic Development, Technological Change, and Growth - - Technological Change - - - Technological Change: Choices and Consequences; Diffusion Processes

References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:

  1. Howarth, Richard B. & Andersson, Bo, 1993. "Market barriers to energy efficiency," Energy Economics, Elsevier, vol. 15(4), pages 262-272, October. [Downloadable!] (restricted)
  2. Carlo Carraro & Domenico Siniscalco, 1992. "Environmental innovation policy and international competition," Environmental & Resource Economics, European Association of Environmental and Resource Economists, vol. 2(2), pages 183-200, March. [Downloadable!] (restricted)
    Other versions:
  3. Erik T. Verhoef & Peter Nijkamp, 1997. "The Regulation of Input Related Externalities with Heterogeneous Firms," Tinbergen Institute Discussion Papers 97-009/3, Tinbergen Institute.
  4. Besanko, David, 1987. "Performance versus design standards in the regulation of pollution," Journal of Public Economics, Elsevier, vol. 34(1), pages 19-44, October. [Downloadable!] (restricted)
  5. Jaffe, Adam B. & Stavins, Robert N., 1994. "The energy paradox and the diffusion of conservation technology," Resource and Energy Economics, Elsevier, vol. 16(2), pages 91-122, May. [Downloadable!] (restricted)
  6. Sanstad, Alan H. & Howarth, Richard B., 1994. "`Normal' markets, market imperfections and energy efficiency," Energy Policy, Elsevier, vol. 22(10), pages 811-818, October. [Downloadable!] (restricted)
  7. Helfand, Gloria E, 1991. "Standards versus Standards: The Effects of Different Pollution Restrictions," American Economic Review, American Economic Association, vol. 81(3), pages 622-34, June. [Downloadable!] (restricted)
  8. Metcalf, Gilbert E., 1994. "Economics and rational conservation policy," Energy Policy, Elsevier, vol. 22(10), pages 819-825, October. [Downloadable!] (restricted)
  9. Jung, Chulho & Krutilla, Kerry & Boyd, Roy, 1996. "Incentives for Advanced Pollution Abatement Technology at the Industry Level: An Evaluation of Policy Alternatives," Journal of Environmental Economics and Management, Elsevier, vol. 30(1), pages 95-111, January. [Downloadable!] (restricted)
  10. Orr, Lloyd, 1976. "Incentive for Innovation as the Basis for Effluent Charge Strategy," American Economic Review, American Economic Association, vol. 66(2), pages 441-47, May.
  11. DeCanio, Stephen J., 1993. "Barriers within firms to energy-efficient investments," Energy Policy, Elsevier, vol. 21(9), pages 906-914, September. [Downloadable!] (restricted)
  12. Marin, A., 1978. "The choice of efficient pollution policies: Technology and economics in the control of sulphur dioxide," Journal of Environmental Economics and Management, Elsevier, vol. 5(1), pages 44-62, March. [Downloadable!] (restricted)
  13. Fudenberg, Drew & Tirole, Jean, 1985. "Preemption and Rent Equilization in the Adoption of New Technology," Review of Economic Studies, Blackwell Publishing, vol. 52(3), pages 383-401, July. [Downloadable!] (restricted)
  14. Milliman, Scott R. & Prince, Raymond, 1989. "Firm incentives to promote technological change in pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 17(3), pages 247-265, November. [Downloadable!] (restricted)
  15. Malueg, David A., 1989. "Emission credit trading and the incentive to adopt new pollution abatement technology," Journal of Environmental Economics and Management, Elsevier, vol. 16(1), pages 52-57, January. [Downloadable!] (restricted)
  16. Downing, Paul B. & White, Lawrence J., 1986. "Innovation in pollution control," Journal of Environmental Economics and Management, Elsevier, vol. 13(1), pages 18-29, March. [Downloadable!] (restricted)
  17. Reinganum, Jennifer F., 1989. "The timing of innovation: Research, development, and diffusion," Handbook of Industrial Organization, in: R. Schmalensee & R. Willig (ed.), Handbook of Industrial Organization, edition 1, volume 1, chapter 14, pages 849-908 Elsevier. [Downloadable!] (restricted)
Full references

Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. Productivity Commission, 2001. "The environmental performance of commercial buildings," Others 0107010, EconWPA. [Downloadable!]
  2. Théophile T. Azomahou & Raouf Boucekkine & Phu Nguyen-Vanc, . "Promoting Clean Technologies: The Energy Market Structure Crucially Matters," Working Papers 2008_13, Department of Economics, University of Glasgow. [Downloadable!]
    Other versions:
  3. Théophile T. Azomahou & Raouf Boucekkine & Phu Nguyen-Vanc, 2009. "Promoting clean technologies under imperfect competition," Working Papers 2009_06, Department of Economics, University of Glasgow. [Downloadable!]
    Other versions:
  4. Erik T. Verhoef & Peter Nijkamp, 1998. "Spatial Dimensions of Environmental Policies for Trans-Boundary Externalities - A Spatial Price Equilibrium Approach," Tinbergen Institute Discussion Papers 98-079/3, Tinbergen Institute. [Downloadable!]
    Other versions:
  5. Erik Teodoor Verhoef & Peter Nijkamp, 1998. "Energy policies in spatial systems: A spatial price equilibrium approach with heterogeneous regions and endogenous technologies," ERSA conference papers ersa98p113, European Regional Science Association. [Downloadable!]
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