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Interfuel substitution effects of biofuel use on carbon dioxide emissions: evidence from the transportation sector

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  • Dong Hee Suh

Abstract

This study examines the interfuel substitution effects of biofuel use on carbon dioxide emissions in the U.S. transportation sector. First, the dynamic linear logit model is used to examine substitution possibilities between biofuels and non-biofuels. The results reveal that petroleum demand is the most inelastic with respect to changes in petroleum prices since the transportation sector depends heavily on the use of petroleum. In addition, ethanol serves as a substitute for petroleum, showing that the use of ethanol can reduce the dependence on petroleum when petroleum prices increase. The results also indicate that ethanol is a complement for natural gas, while natural gas is a substitute for petroleum. Second, the coefficients for carbon dioxide emissions are used to compute the potential amount of carbon dioxide associated with interfuel substitution. The results represent that price-induced interfuel substitution is a critical factor to predict biofuel-related carbon dioxide emissions.

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  • Dong Hee Suh, 2019. "Interfuel substitution effects of biofuel use on carbon dioxide emissions: evidence from the transportation sector," Applied Economics, Taylor & Francis Journals, vol. 51(31), pages 3413-3422, July.
    • Handle: RePEc:taf:applec:v:51:y:2019:i:31:p:3413-3422
    DOI: 10.1080/00036846.2019.1581906
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    Cited by:

    1. Mufutau Opeyemi Bello & Sakiru Adebola Solarin, 2022. "Searching for sustainable electricity generation: The possibility of substituting coal and natural gas with clean energy," Energy & Environment, , vol. 33(1), pages 64-84, February.
    2. Karel Janda & Eva Michalikova & Luiz Célio Souza Rocha & Paulo Rotella Junior & Barbora Schererova & David Zilberman, 2022. "Review of the Impact of Biofuels on U.S. Retail Gasoline Prices," Energies, MDPI, vol. 16(1), pages 1-21, December.
    3. Hossain, A. K. M. Nurul & Serletis, Apostolos, 2020. "Biofuel substitution in the U.S. transportation sector," The Journal of Economic Asymmetries, Elsevier, vol. 22(C).
    4. Istiak Ahmad & Fahad Alqurashi & Ehab Abozinadah & Rashid Mehmood, 2022. "Deep Journalism and DeepJournal V1.0: A Data-Driven Deep Learning Approach to Discover Parameters for Transportation," Sustainability, MDPI, vol. 14(9), pages 1-72, May.

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