Markets for energy efficiency: Exploring the implications of an EU-wide 'Tradable White Certificate' scheme
Mundaca, Luis LU
(2008)
In Energy Economics
30(6).
p.3016-3043
- Abstract
- Recent developments in European energy policy reveal an increasing
interest in implementing the so-called ‘Tradable White Certificate’
(TWC) schemes to improve energy efficiency. Based on three evaluation
criteria (cost-effectiveness, environmental effectiveness and
distributional equity) this paper analyses the implications of
implementing a European-wide TWC scheme targeting the household
and commercial sectors. Using a bottom-up model, quantitative results
show significant cost-effective potentials for improvements (ca. 1400
TWh in cumulative energy savings by 2020), with the household sector,
gas and space heating representing most of the TWC supply in... (More) - Recent developments in European energy policy reveal an increasing
interest in implementing the so-called ‘Tradable White Certificate’
(TWC) schemes to improve energy efficiency. Based on three evaluation
criteria (cost-effectiveness, environmental effectiveness and
distributional equity) this paper analyses the implications of
implementing a European-wide TWC scheme targeting the household
and commercial sectors. Using a bottom-up model, quantitative results
show significant cost-effective potentials for improvements (ca. 1400
TWh in cumulative energy savings by 2020), with the household sector,
gas and space heating representing most of the TWC supply in terms of
eligible sector, fuel and energy service demand, respectively. If a single
market price of negative externalities is considered, a societal costeffective potential of energy savings above 30% (compared to the
baseline) is observed. In environmental terms, the resulting greenhouse
gas emission reductions are around 200Mt CO2-eq by 2010, representing
nearly 60% of the EU-Kyoto-target. From the qualitative perspective,
several embedded ancillary benefits are identified (e.g. employment
generation, improved comfort level, reduced ‘fuel poverty’, security of
energy supply). Whereas an EU-wide TWC increases liquidity and
reduces the risks ofmarket power, autarky compliance strategies may be
expected in order to capture co-benefits nationally. Cross subsidies could
occur due to investment recovery mechanisms and there is a risk that
effects may be regressive for low-income households. Assumptions
undertaken by the modelling approach strongly indicate that high
effectiveness of other policy instruments is needed for an EU-wide TWC
scheme to be cost-effective. (Less)
Please use this url to cite or link to this publication:
https://lup.lub.lu.se/record/1278555
- author
- Mundaca, Luis
LU
- organization
- publishing date
- 2008
- type
- Contribution to journal
- publication status
- published
- subject
- keywords
- Energy efficiency Energy policy Ex-ante evaluation EU-wide tradable white certificate scheme
- in
- Energy Economics
- volume
- 30
- issue
- 6
- pages
- 3016 - 3043
- publisher
- Elsevier
- external identifiers
-
- wos:000260272900018
- scopus:52049089458
- ISSN
- 0140-9883
- DOI
- 10.1016/j.eneco.2008.03.004
- language
- English
- LU publication?
- yes
- id
- 98ac4097-24ee-44a0-8792-a38613b37baa (old id 1278555)
- date added to LUP
- 2016-04-01 12:32:38
- date last changed
- 2024-04-23 21:00:19
@article{98ac4097-24ee-44a0-8792-a38613b37baa,
abstract = {{Recent developments in European energy policy reveal an increasing<br/><br>
interest in implementing the so-called ‘Tradable White Certificate’<br/><br>
(TWC) schemes to improve energy efficiency. Based on three evaluation<br/><br>
criteria (cost-effectiveness, environmental effectiveness and<br/><br>
distributional equity) this paper analyses the implications of<br/><br>
implementing a European-wide TWC scheme targeting the household<br/><br>
and commercial sectors. Using a bottom-up model, quantitative results<br/><br>
show significant cost-effective potentials for improvements (ca. 1400<br/><br>
TWh in cumulative energy savings by 2020), with the household sector,<br/><br>
gas and space heating representing most of the TWC supply in terms of<br/><br>
eligible sector, fuel and energy service demand, respectively. If a single<br/><br>
market price of negative externalities is considered, a societal costeffective potential of energy savings above 30% (compared to the<br/><br>
baseline) is observed. In environmental terms, the resulting greenhouse<br/><br>
gas emission reductions are around 200Mt CO2-eq by 2010, representing<br/><br>
nearly 60% of the EU-Kyoto-target. From the qualitative perspective,<br/><br>
several embedded ancillary benefits are identified (e.g. employment<br/><br>
generation, improved comfort level, reduced ‘fuel poverty’, security of<br/><br>
energy supply). Whereas an EU-wide TWC increases liquidity and<br/><br>
reduces the risks ofmarket power, autarky compliance strategies may be<br/><br>
expected in order to capture co-benefits nationally. Cross subsidies could<br/><br>
occur due to investment recovery mechanisms and there is a risk that<br/><br>
effects may be regressive for low-income households. Assumptions<br/><br>
undertaken by the modelling approach strongly indicate that high<br/><br>
effectiveness of other policy instruments is needed for an EU-wide TWC<br/><br>
scheme to be cost-effective.}},
author = {{Mundaca, Luis}},
issn = {{0140-9883}},
keywords = {{Energy efficiency
Energy policy
Ex-ante evaluation
EU-wide tradable white certificate scheme}},
language = {{eng}},
number = {{6}},
pages = {{3016--3043}},
publisher = {{Elsevier}},
series = {{Energy Economics}},
title = {{Markets for energy efficiency: Exploring the implications of an EU-wide 'Tradable White Certificate' scheme}},
url = {{http://dx.doi.org/10.1016/j.eneco.2008.03.004}},
doi = {{10.1016/j.eneco.2008.03.004}},
volume = {{30}},
year = {{2008}},
}