The role of the terms of trade in the trade channel of transmission of oil price shocks

This paper highlights the role of the terms of trade in the trade channel of propagation of oil price shocks both empirically and theoretically. Empirically, I show that oil price shocks have a large, persistent and statistically significant impact on the US terms of trade. Theoretically, I add oil in the model by Corsetti and Pesenti (2005) and analyse under what conditions the terms of trade plays a relevant role in the international transmission of oil price shocks. With nominal price rigidities and full exchange rate pass-through positive oil price shocks depreciate the currency of the oil importing country. The subsequent negative wealth effect adds to the recessive effect of the supply channel and may trongly reduce the consumption in the oil importing country economy. Without exchange rate pass-through oil shocks transmit to the economy only through the supply channel. The model suggests that a change in the exchange rate pass-through might contribute to explain the evidence of a weaker impact of oil price shocks on the macroeconomic activity in recent times.

Income risk of EU coal-fired power plants after Kyoto

Coal-fired power plants may enjoy a significant advantage relative to gas plants in terms of cheaper fuel cost. Still, this advantage may erode or even turn into disadvantage depending on CO2 emission allowance price. This price will presumably rise in both the Kyoto Protocol commitment period (2008-2012) and the first post-Kyoto years. Thus, in a carbon-constrained environment, coal plants face financial risks arising in their profit margins, which in turn hinge on their so-called "clean dark spread". These risks are further reinforced when the price of the output electricity is determined by natural gas-fired plants' marginal costs, which differ from coal plants' costs. We aim to assess the risks in coal plants' margins. We adopt parameter values estimated from empirical data. These in turn are derived from natural gas and electricity markets alongside the EU ETS market where emission allowances are traded. Monte Carlo simulation allows to compute the expected value and risk profile of coal-based electricity generation. We focus on the clean dark spread in both time periods under different future scenarios in the allowance market. Specifically, bottom 5% and 10% percentiles are derived. According to our results, certain future paths of the allowance price may impose significant risks on the clean dark spread obtained by coal plants.

Dealing with Energy-QoE Trade-Offs in Mobile Video

Scalable video coding allows an efficient provision of video services at different quality levels with different energy demands. According to the specific type of service and network scenario, end users and/or operators may decide to choose among different energy versus quality combinations. In order to deal with the resulting trade-off, in this paper we analyze the number of video layers that are worth to be received taking into account the energy constraints. A single-objective optimization is proposed based on dynamically selecting the number of layers, which is able to minimize the energy consumption with the constraint of a minimal quality threshold to be reached. However, this approach cannot reflect the fact that the same increment of energy consumption may result in different increments of visual quality. Thus, a multiobjective optimization is proposed and a utility function is defined in order to weight the energy consumption and the visual quality criteria. Finally, since the optimization solving mechanism is computationally expensive to be implemented in mobile devices, a heuristic algorithm is proposed. This way, significant energy consumption reduction will be achieved while keeping reasonable quality levels.

Effects of international trade of food and feed and human diet shifts on food security and environmental safety: integrating scales

4 p.

Optimal Abandonment of Coal-Fired Stations in the EU

36 p.

A dynamic CGE modelling approach for analyzing trade-offs in climate change policy options: the case of Green Climate Fund

38 p.