IDEAS home Printed from https://ideas.repec.org/a/ags/aareaj/338501.html
   My bibliography  Save this article

Energy mix persistence and the effect of carbon pricing

Author

Listed:
  • Best, Rohan
  • Burke, Paul J.

Abstract

Energy mix persistence is a defining characteristic of energy systems, for reasons including the long-lived nature of energy infrastructure and the role of local endowments. This persistence is evident in current energy-type use being strongly influenced by past use. Our analysis uses data for eight energy types and a large sample of countries, finding varying degrees of energy mix persistence. We also find evidence that carbon pricing appears to have played a key role in tilting energy mixes from coal towards renewable energy. Our estimates provide empirical support to policymakers seeking to implement carbon pricing to transition their energy systems in a lower carbon direction.

Suggested Citation

  • Best, Rohan & Burke, Paul J., 2020. "Energy mix persistence and the effect of carbon pricing," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 64(3), July.
    • Handle: RePEc:ags:aareaj:338501
    DOI: 10.22004/ag.econ.338501
    as

    Download full text from publisher

    File URL: https://ageconsearch.umn.edu/record/338501/files/ajar12370.pdf
    Download Restriction: no
    File URL: https://libkey.io/10.22004/ag.econ.338501?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Tol, Richard S.J., 2017. "The structure of the climate debate," Energy Policy, Elsevier, vol. 104(C), pages 431-438.
    2. Burke, Paul J., 2013. "The national-level energy ladder and its carbon implications," Environment and Development Economics, Cambridge University Press, vol. 18(4), pages 484-503, August.
    3. Paul J. Burke, 2012. "Climbing the electricity ladder generates carbon Kuznets curve downturns," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 56(2), pages 260-279, April.
    4. Mr. David Coady & Ian W.H. Parry & Louis Sears & Baoping Shang, 2015. "How Large Are Global Energy Subsidies?," IMF Working Papers 2015/105, International Monetary Fund.
    5. Paul J. Burke, 2016. "Undermined by Adverse Selection: Australia's Direct Action Abatement Subsidies," Economic Papers, The Economic Society of Australia, vol. 35(3), pages 216-229, September.
    6. Marianna O'Gorman & Frank Jotzo, 2014. "Impact of the Carbon Price on Australia's Electricity Demand, Supply and Emissions," CCEP Working Papers 1411, Centre for Climate & Energy Policy, Crawford School of Public Policy, The Australian National University.
    7. Jakob, Michael & Haller, Markus & Marschinski, Robert, 2012. "Will history repeat itself? Economic convergence and convergence in energy use patterns," Energy Economics, Elsevier, vol. 34(1), pages 95-104.
    8. Lawrence H. Goulder & Andrew R. Schein, 2013. "Carbon Taxes Versus Cap And Trade: A Critical Review," Climate Change Economics (CCE), World Scientific Publishing Co. Pte. Ltd., vol. 4(03), pages 1-28.
    9. N Gregory Mankiw, 2009. "Smart Taxes: An Open Invitation to Join the Pigou Club," Eastern Economic Journal, Palgrave Macmillan;Eastern Economic Association, vol. 35(1), pages 14-23.
    10. Jonas Meckling & Thomas Sterner & Gernot Wagner, 2017. "Policy sequencing toward decarbonization," Nature Energy, Nature, vol. 2(12), pages 918-922, December.
    11. Best, Rohan & Burke, Paul J., 2018. "Adoption of solar and wind energy: The roles of carbon pricing and aggregate policy support," Energy Policy, Elsevier, vol. 118(C), pages 404-417.
    12. Burke, Paul J., 2010. "Income, resources, and electricity mix," Energy Economics, Elsevier, vol. 32(3), pages 616-626, May.
    13. Michael L. Ross & Chad Hazlett & Paasha Mahdavi, 2017. "Global progress and backsliding on gasoline taxes and subsidies," Nature Energy, Nature, vol. 2(1), pages 1-6, January.
    14. Roger Fouquet, 2016. "Path dependence in energy systems and economic development," Nature Energy, Nature, vol. 1(8), pages 1-5, August.
    15. Brunnschweiler, Christa N., 2010. "Finance for renewable energy: an empirical analysis of developing and transition economies," Environment and Development Economics, Cambridge University Press, vol. 15(3), pages 241-274, June.
    16. Aichele, Rahel & Felbermayr, Gabriel, 2012. "Kyoto and the carbon footprint of nations," Journal of Environmental Economics and Management, Elsevier, vol. 63(3), pages 336-354.
    17. Sanya Carley & Elizabeth Baldwin & Lauren M. MacLean & Jennifer N. Brass, 2017. "Global Expansion of Renewable Energy Generation: An Analysis of Policy Instruments," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 68(2), pages 397-440, October.
    18. Rahel Aichele & Gabriel Felbermayr, 2013. "The Effect of the Kyoto Protocol on Carbon Emissions," Journal of Policy Analysis and Management, John Wiley & Sons, Ltd., vol. 32(4), pages 731-757, September.
    19. I. A. Grant Wilson & Iain Staffell, 2018. "Rapid fuel switching from coal to natural gas through effective carbon pricing," Nature Energy, Nature, vol. 3(5), pages 365-372, May.
    20. Susan Athey & Guido W. Imbens, 2017. "The State of Applied Econometrics: Causality and Policy Evaluation," Journal of Economic Perspectives, American Economic Association, vol. 31(2), pages 3-32, Spring.
    21. Best, Rohan, 2017. "Switching towards coal or renewable energy? The effects of financial capital on energy transitions," Energy Economics, Elsevier, vol. 63(C), pages 75-83.
    22. Ilmi Granoff & J. Ryan Hogarth & Alan Miller, 2016. "Nested barriers to low-carbon infrastructure investment," Nature Climate Change, Nature, vol. 6(12), pages 1065-1071, December.
    23. Cameron Hepburn, 2017. "Make carbon pricing a priority," Nature Climate Change, Nature, vol. 7(6), pages 389-390, June.
    24. World Bank & Ecofys, "undated". "State and Trends of Carbon Pricing 2018," World Bank Publications - Reports 29687, The World Bank Group.
    25. Rohan Best & Paul J. Burke, 2017. "The Importance of Government Effectiveness for Transitions toward Greater Electrification in Developing Countries," Energies, MDPI, vol. 10(9), pages 1-17, August.
    26. Marques, António Cardoso & Fuinhas, José Alberto, 2011. "Drivers promoting renewable energy: A dynamic panel approach," Renewable and Sustainable Energy Reviews, Elsevier, vol. 15(3), pages 1601-1608, April.
    27. Lawrence Goulder, 1995. "Environmental taxation and the double dividend: A reader's guide," International Tax and Public Finance, Springer;International Institute of Public Finance, vol. 2(2), pages 157-183, August.
    28. Julius J. Andersson, 2019. "Carbon Taxes and CO2 Emissions: Sweden as a Case Study," American Economic Journal: Economic Policy, American Economic Association, vol. 11(4), pages 1-30, November.
    29. Fallahi, Firouz, 2017. "Stochastic convergence in per capita energy use in world," Energy Economics, Elsevier, vol. 65(C), pages 228-239.
    30. Csereklyei, Zsuzsanna & Thurner, Paul W. & Langer, Johannes & Küchenhoff, Helmut, 2017. "Energy paths in the European Union: A model-based clustering approach," Energy Economics, Elsevier, vol. 65(C), pages 442-457.
    31. Tobias S. Schmidt & Sebastian Sewerin, 2017. "Technology as a driver of climate and energy politics," Nature Energy, Nature, vol. 2(6), pages 1-3, June.
    32. Solomon, Barry D. & Krishna, Karthik, 2011. "The coming sustainable energy transition: History, strategies, and outlook," Energy Policy, Elsevier, vol. 39(11), pages 7422-7431.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rohan Best & Paul J. Burke & Frank Jotzo, 2020. "Carbon Pricing Efficacy: Cross-Country Evidence," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 77(1), pages 69-94, September.
    2. Csereklyei, Zsuzsanna & Anantharama, Nandini & Kallies, Anne, 2021. "Electricity market transitions in Australia: Evidence using model-based clustering," Energy Economics, Elsevier, vol. 103(C).
    3. Li, Yangfan & Zhang, Xiaoyun, 2023. "Recycling scheme of carbon pricing for inclusive decarbonization and energy transition: A recursive computable general equilibrium analysis in China," Renewable Energy, Elsevier, vol. 217(C).
    4. Hammerle, Mara & Best, Rohan & Crosby, Paul, 2021. "Public acceptance of carbon taxes in Australia," Energy Economics, Elsevier, vol. 101(C).
    5. Lijuan Zhang & Tatyana Ponomarenko, 2023. "Directions for Sustainable Development of China’s Coal Industry in the Post-Epidemic Era," Sustainability, MDPI, vol. 15(8), pages 1-32, April.
    6. Rohan Best & Noura Saba, 2021. "Quantifying Australia’s Gender Superannuation Gap," The Economic Record, The Economic Society of Australia, vol. 97(318), pages 410-423, September.
    7. Paul J. Burke, 2023. "On the way out: Government revenues from fossil fuels in Australia," Australian Journal of Agricultural and Resource Economics, Australian Agricultural and Resource Economics Society, vol. 67(1), pages 1-17, January.
    8. Best, Rohan & Zhang, Qiu Yue, 2020. "What explains carbon-pricing variation between countries?," Energy Policy, Elsevier, vol. 143(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Best, Rohan & Burke, Paul J., 2018. "Adoption of solar and wind energy: The roles of carbon pricing and aggregate policy support," Energy Policy, Elsevier, vol. 118(C), pages 404-417.
    2. Best, Rohan & Zhang, Qiu Yue, 2020. "What explains carbon-pricing variation between countries?," Energy Policy, Elsevier, vol. 143(C).
    3. Rohan Best & Paul J. Burke & Frank Jotzo, 2020. "Carbon Pricing Efficacy: Cross-Country Evidence," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 77(1), pages 69-94, September.
    4. Csereklyei, Zsuzsanna & Anantharama, Nandini & Kallies, Anne, 2021. "Electricity market transitions in Australia: Evidence using model-based clustering," Energy Economics, Elsevier, vol. 103(C).
    5. Escoffier, Margaux & Hache, Emmanuel & Mignon, Valérie & Paris, Anthony, 2021. "Determinants of solar photovoltaic deployment in the electricity mix: Do oil prices really matter?," Energy Economics, Elsevier, vol. 97(C).
    6. Hammerle, Mara & Best, Rohan & Crosby, Paul, 2021. "Public acceptance of carbon taxes in Australia," Energy Economics, Elsevier, vol. 101(C).
    7. Bourcet, Clémence, 2020. "Empirical determinants of renewable energy deployment: A systematic literature review," Energy Economics, Elsevier, vol. 85(C).
    8. Rohan Best & Fatemeh Nazifi & Han Cheng, 2024. "Carbon Pricing Impacts on Four Pollutants: A Cross-Country Analysis," Energies, MDPI, vol. 17(11), pages 1-18, May.
    9. Stern, David I. & Gerlagh, Reyer & Burke, Paul J., 2017. "Modeling the emissions–income relationship using long-run growth rates," Environment and Development Economics, Cambridge University Press, vol. 22(6), pages 699-724, December.
    10. Best, Rohan, 2017. "Switching towards coal or renewable energy? The effects of financial capital on energy transitions," Energy Economics, Elsevier, vol. 63(C), pages 75-83.
    11. Karoliina Isoaho & Jochen Markard, 2020. "The Politics of Technology Decline: Discursive Struggles over Coal Phase‐Out in the UK," Review of Policy Research, Policy Studies Organization, vol. 37(3), pages 342-368, May.
    12. Ibrahiem, Dalia M. & Hanafy, Shaimaa A., 2021. "Do energy security and environmental quality contribute to renewable energy? The role of trade openness and energy use in North African countries," Renewable Energy, Elsevier, vol. 179(C), pages 667-678.
    13. Leroutier, Marion, 2022. "Carbon pricing and power sector decarbonization: Evidence from the UK," Journal of Environmental Economics and Management, Elsevier, vol. 111(C).
    14. Richard S.J. Tol, 2018. "Energy and Climate," Working Paper Series 1618, Department of Economics, University of Sussex Business School.
    15. Paul J. Burke & Md Shahiduzzaman & David I. Stern, 2015. "Carbon dioxide emissions in the short run: The rate and sources of economic growth matter," CAMA Working Papers 2015-12, Centre for Applied Macroeconomic Analysis, Crawford School of Public Policy, The Australian National University.
    16. Best, Rohan & Trück, Stefan, 2020. "Capital and policy impacts on Australian small-scale solar installations," Energy Policy, Elsevier, vol. 136(C).
    17. Pfeiffer, Alexander & Millar, Richard & Hepburn, Cameron & Beinhocker, Eric, 2016. "The ‘2°C capital stock’ for electricity generation: Committed cumulative carbon emissions from the electricity generation sector and the transition to a green economy," Applied Energy, Elsevier, vol. 179(C), pages 1395-1408.
    18. He, Zhengxia & Cao, Changshuai & Kuai, Leyi & Zhou, Yanqing & Wang, Jianming, 2022. "Impact of policies on wind power innovation at different income levels: Regional differences in China based on dynamic panel estimation," Technology in Society, Elsevier, vol. 71(C).
    19. Qin, Yong & Xu, Zeshui & Wang, Xinxin & Škare, Marinko, 2023. "The effects of financial institutions on the green energy transition: A cross-sectional panel study," Economic Analysis and Policy, Elsevier, vol. 78(C), pages 524-542.
    20. Johan Lilliestam & Anthony Patt & Germán Bersalli, 2021. "The effect of carbon pricing on technological change for full energy decarbonization: A review of empirical ex‐post evidence," Wiley Interdisciplinary Reviews: Climate Change, John Wiley & Sons, vol. 12(1), January.

    More about this item

    Keywords

    Resource /Energy Economics and Policy;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ags:aareaj:338501. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: AgEcon Search (email available below). General contact details of provider: https://edirc.repec.org/data/aaresea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.