IDEAS home Printed from https://ideas.repec.org/a/spr/jbecon/v87y2017i1d10.1007_s11573-016-0829-1.html
   My bibliography  Save this article

Analyzing investment strategies under changing energy and climate policies: an interdisciplinary bottom-up approach regarding German metal industries

Author

Listed:
  • Patrick Breun

    () (French-German Institute for Environmental Research (DFIU), Karlsruhe Institute of Technology (KIT))

  • Magnus Fröhling

    () (Technische Universität Bergakademie Freiberg)

  • Konrad Zimmer

    () (French-German Institute for Environmental Research (DFIU), Karlsruhe Institute of Technology (KIT))

  • Frank Schultmann

    () (French-German Institute for Environmental Research (DFIU), Karlsruhe Institute of Technology (KIT))

Abstract

Abstract German metal producers face an intense international competition. The comparably high domestic energy and production costs additionally challenge the producers. Beside this, German energy intensive industries (GEII) are embedded in a complex regulatory framework induced by energy and climate policies. These policies consist of different economic political instruments which are regularly changed to incentivize greenhouse gas (GHG) emission reductions. Therefore, future investment decisions in energy efficiency increasing technologies (EEIT) have to be evaluated dependent on these changing political conditions. Thus, actors in the metal industry need decision support in developing sustainable investment strategies which withstand different political developments. Given these circumstances, we develop an actor-oriented simulation model which simulates the optimal future investment decisions of all German iron, steel and aluminum producing plants under different political conditions based on a detailed plant-specific technical process description. Thereby, economic and engineering parameters are combined in an interdisciplinary approach to derive future investment strategies for the metal producing plants facing probable political changes. This approach closes the scientific gap between top-down oriented studies which usually are not capable of representing detailed plant-specific aspects and solely technical oriented studies which are often limited to a single plant or facility.

Suggested Citation

  • Patrick Breun & Magnus Fröhling & Konrad Zimmer & Frank Schultmann, 2017. "Analyzing investment strategies under changing energy and climate policies: an interdisciplinary bottom-up approach regarding German metal industries," Journal of Business Economics, Springer, vol. 87(1), pages 5-39, January.
  • Handle: RePEc:spr:jbecon:v:87:y:2017:i:1:d:10.1007_s11573-016-0829-1
    DOI: 10.1007/s11573-016-0829-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s11573-016-0829-1
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Manne, Alan & Mendelsohn, Robert & Richels, Richard, 1995. "MERGE : A model for evaluating regional and global effects of GHG reduction policies," Energy Policy, Elsevier, vol. 23(1), pages 17-34, January.
    2. Porzio, Giacomo Filippo & Fornai, Barbara & Amato, Alessandro & Matarese, Nicola & Vannucci, Marco & Chiappelli, Lisa & Colla, Valentina, 2013. "Reducing the energy consumption and CO2 emissions of energy intensive industries through decision support systems – An example of application to the steel industry," Applied Energy, Elsevier, vol. 112(C), pages 818-833.
    3. Fröhling, Magnus & Schwaderer, Frank & Bartusch, Hauke & Rentz, Otto, 2010. "Integrated planning of transportation and recycling for multiple plants based on process simulation," European Journal of Operational Research, Elsevier, vol. 207(2), pages 958-970, December.
    4. Schumacher, Katja & Sands, Ronald D., 2007. "Where are the industrial technologies in energy-economy models? An innovative CGE approach for steel production in Germany," Energy Economics, Elsevier, vol. 29(4), pages 799-825, July.
    5. Hare, M & Deadman, P, 2004. "Further towards a taxonomy of agent-based simulation models in environmental management," Mathematics and Computers in Simulation (MATCOM), Elsevier, vol. 64(1), pages 25-40.
    6. Ackerman, Frank & Munitz, Charles, 2012. "Climate damages in the FUND model: A disaggregated analysis," Ecological Economics, Elsevier, vol. 77(C), pages 219-224.
    7. Alberth, Stephan & Hope, Chris, 2007. "Climate modelling with endogenous technical change: Stochastic learning and optimal greenhouse gas abatement in the PAGE2002 model," Energy Policy, Elsevier, vol. 35(3), pages 1795-1807, March.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Energy intensive industries; Metal industry; Climate policy; Bottom-up approach; Investment decision; Greenhouse gas emissions;

    JEL classification:

    • L61 - Industrial Organization - - Industry Studies: Manufacturing - - - Metals and Metal Products; Cement; Glass; Ceramics

    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:spr:jbecon:v:87:y:2017:i:1:d:10.1007_s11573-016-0829-1. See general information about how to correct material in RePEc.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Sonal Shukla) or (Andrew Huffard) The email address of this maintainer does not seem to be valid anymore. Please ask Andrew Huffard to update the entry or send us the correct email address. General contact details of provider: http://www.springer.com .

    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 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.

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

    IDEAS is a RePEc service hosted by the Research Division of the Federal Reserve Bank of St. Louis . RePEc uses bibliographic data supplied by the respective publishers.