How Much Market Do Market-Based Instruments Create?: An Analysis for the Case of "White" Certificates
In the context of economic instruments for more energy efficiency and climate protection, tradable certificates have been investigated for renewable energy and for a number of emissions. In contrast, tradable energy efficiency - or "white" - certificates have only lately been considered as a market-based tool to foster energy efficiency as compared to standards and labelling, for example. Theoretically, there is little doubt about the advantages. In practice, however, somefundamental problems arise. Critical issues are the design of an efficient artificial market for "white" certificates, its compatibility with the European emissions trading system, the identification of a suitable target group for an energy efficiency obligation and the measurement of energy savings as compared to a reference use of energy. We use the theoretical framework of Transaction Cost Economics to elaborate these issues. We conclude that transaction costs and investment specificity will restrict markets for "white" certificates in practise. Long-term contracts rather than spot trade will be the prevailing form of governance for energy efficiency investments.
|Date of creation:||2004|
|Date of revision:|
|Contact details of provider:|| Postal: Mohrenstraße 58, D-10117 Berlin|
Web page: http://www.diw.de/en
More information through EDIRC
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.:
- Fisher, Anthony C. & Rothkopf, Michael H., 1989. "Market failure and energy policy A rationale for selective conservation," Energy Policy, Elsevier, vol. 17(4), pages 397-406, August.
- DeCanio, Stephen J., 1993. "Barriers within firms to energy-efficient investments," Energy Policy, Elsevier, vol. 21(9), pages 906-914, September.
- A. Michaelowa & E. Fages, 1999. "Options for baselines of the clean development mechanism," Post-Print hal-00716168, HAL.
- Axel Michaelowa & Emmanuel Fages, 1999. "Options for baselines of the clean development mechanism," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 4(2), pages 167-185, June.
- Edward Vine & Jayant Sathaye, 2000. "The monitoring, Evaluation, reporting, verification, and certification of energy-efficiency projects," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 5(2), pages 189-216, June.
- Haas, R. & Eichhammer, W. & Huber, C. & Langniss, O. & Lorenzoni, A. & Madlener, R. & Menanteau, P. & Morthorst, P. -E. & Martins, A. & Oniszk, A. & Schleich, J. & Smith, A. & Vass, Z. & Verbruggen, A, 2004.
"How to promote renewable energy systems successfully and effectively,"
Elsevier, vol. 32(6), pages 833-839, April.
- R. Haas & W. Eichhammer & C. Huber & O. Langniss & A. Lorenzoni & R. Madlener & Philippe Menanteau & P.E. Morthorst & A. Martins & A. Oniszk, 2004. "How to promote renewable energy systems successfully and effectively," Post-Print halshs-00480446, HAL.
- Stavins Robert N., 1995. "Transaction Costs and Tradeable Permits," Journal of Environmental Economics and Management, Elsevier, vol. 29(2), pages 133-148, September.
- Vine, Edward & Hamrin, Jan & Eyre, Nick & Crossley, David & Maloney, Michelle & Watt, Greg, 2003. "Public policy analysis of energy efficiency and load management in changing electricity businesses," Energy Policy, Elsevier, vol. 31(5), pages 405-430, April.
- VINAYAK Bhattacharjee & CHARLES J. Cicchetti & WILLIAM F. Rankin, 1993. "Energy Utilities, Conservation, And Economic Efficiency," Contemporary Economic Policy, Western Economic Association International, vol. 11(1), pages 69-75, 01.
- Blumstein, Carl & Krieg, Betsy & Schipper, Lee & York, Carl, 1980. "Overcoming social and institutional barriers to energy conservation," Energy, Elsevier, vol. 5(4), pages 355-371.
When requesting a correction, please mention this item's handle: RePEc:diw:diwwpp:dp425. 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: (Bibliothek)
If references are entirely missing, you can add them using this form.