An exergy based engineering and economic analysis of sustainable building

To achieve the goal of sustainable development, the building energy system was evaluated from both the first and second law of thermodynamics point of view. The relationship between exergy destruction and sustainable development were discussed at first, followed by the description of the resource abundance model, the life cycle analysis model and the economic investment effectiveness model. By combining the forgoing models, a new sustainable index was proposed. Several green building case studies in U.S. and China were presented. The influences of building function, geographic location, climate pattern, the regional energy structure, and the technology improvement potential of renewable energy in the future were discussed. The building’s envelope, HVAC system, on-site renewable energy system life cycle analysis from energy, exergy, environmental and economic perspective were compared. It was found that climate pattern had a dramatic influence on the life cycle investment effectiveness of the building envelope. The building HVAC system energy performance was much better than its exergy performance. To further increase the exergy efficiency, renewable energy rather than fossil fuel should be used as the primary energy. A building life cycle cost and exergy consumption regression model was set up. The optimal building insulation level could be affected by either cost minimization or exergy consumption minimization approach. The exergy approach would cause better insulation than cost approach. The influence of energy price on the system selection strategy was discussed. Two photovoltaics (PV) systems—stand alone and grid tied system were compared by the life cycle assessment method. The superiority of the latter one was quite obvious. The analysis also showed that during its life span PV technology was less attractive economically because the electricity price in U.S. and China did not fully reflect the environmental burden associated with it. However if future energy price surges and PV system cost reductions were considered, the technology could be very promising for sustainable buildings in the future.

An Exergy Based Engineering and Economic Analysis of Sustainable Building

To achieve the goal of sustainable development, the building energy system was evaluated from both the first and second law of thermodynamics point of view. The relationship between exergy destruction and sustainable development were discussed at first, followed by the description of the resource abundance model, the life cycle analysis model and the economic investment effectiveness model. By combining the forgoing models, a new sustainable index was proposed. Several green building case studies in U.S. and China were presented. The influences of building function, geographic location, climate pattern, the regional energy structure, and the technology improvement potential of renewable energy in the future were discussed. The building’s envelope, HVAC system, on-site renewable energy system life cycle analysis from energy, exergy, environmental and economic perspective were compared. It was found that climate pattern had a dramatic influence on the life cycle investment effectiveness of the building envelope. The building HVAC system energy performance was much better than its exergy performance. To further increase the exergy efficiency, renewable energy rather than fossil fuel should be used as the primary energy. A building life cycle cost and exergy consumption regression model was set up. The optimal building insulation level could be affected by either cost minimization or exergy consumption minimization approach. The exergy approach would cause better insulation than cost approach. The influence of energy price on the system selection strategy was discussed. Two photovoltaics (PV) systems – stand alone and grid tied system were compared by the life cycle assessment method. The superiority of the latter one was quite obvious. The analysis also showed that during its life span PV technology was less attractive economically because the electricity price in U.S. and China did not fully reflect the environmental burden associated with it. However if future energy price surges and PV system cost reductions were considered, the technology could be very promising for sustainable buildings in the future.

Essays on emissions trading markets

This dissertation is a collection of three economics essays on different aspects of carbon emission trading markets. The first essay analyzes the dynamic optimal emission control strategies of two nations. With a potential to become the largest buyer under the Kyoto Protocol, the US is assumed to be a monopsony, whereas with a large number of tradable permits on hand Russia is assumed to be a monopoly. Optimal costs of emission control programs are estimated for both the countries under four different market scenarios: non-cooperative no trade, US monopsony, Russia monopoly, and cooperative trading. The US monopsony scenario is found to be the most Pareto cost efficient. The Pareto efficient outcome, however, would require the US to make side payments to Russia, which will even out the differences in the cost savings from cooperative behavior. The second essay analyzes the price dynamics of the Chicago Climate Exchange (CCX), a voluntary emissions trading market. By examining the volatility in market returns using AR-GARCH and Markov switching models, the study associates the market price fluctuations with two different political regimes of the US government. Further, the study also identifies a high volatility in the returns few months before the market collapse. Three possible regulatory and market-based forces are identified as probable causes of market volatility and its ultimate collapse. Organizers of other voluntary markets in the US and worldwide may closely watch for these regime switching forces in order to overcome emission market crashes. The third essay compares excess skewness and kurtosis in carbon prices between CCX and EU ETS (European Union Emission Trading Scheme) Phase I and II markets, by examining the tail behavior when market expectations exceed the threshold level. Dynamic extreme value theory is used to find out the mean price exceedence of the threshold levels and estimate the risk loss. The calculated risk measures suggest that CCX and EU ETS Phase I are extremely immature markets for a risk investor, whereas EU ETS Phase II is a more stable market that could develop as a mature carbon market in future years.

Pricing in the Hospitality Industry: An Implicit Markets Approach

The authors apply economic theory to an analysis of industry pricing. Data from a cross-section of San Francisco hotels is used to estimate the implicit prices of common hotel amenities, and a procedure for using these prices to estimate consumer demands for the attributes is outlined. The authors then suggest implications for hotel decision makers. While the results presented here should not be generalized to other markets, the methodology is easily adapted to other geographic areas.

Microstructure Characteristics of U.S. Futures Markets

Prior finance literature lacks a comprehensive analysis of microstructure characteristics of U.S. futures markets due to the lack of data availability. Utilizing a unique data set for five different futures contract this dissertation fills this gap in the finance literature. In three essays price discovery, resiliency and the components of bid-ask spreads in electronic futures markets are examined. In order to provide comprehensive and robust analysis, both moderately volatile pre-crisis and volatile crisis periods are included in the analysis. The first essay entitled “Price Discovery and Liquidity Characteristics for U.S. Electronic Futures and ETF Markets” explores the price discovery process in U.S. futures and ETF markets. Hasbrouck’s information share method is applied to futures and ETF instruments. The information share results show that futures markets dominate the price discovery process. The results on the factors that affect the price discovery process show that when volatility increases, the price leadership of futures markets declines. Furthermore, when the relative size of bid-ask spread in one market increases, its information share decreases. The second essay, entitled “The Resiliency of Large Trades for U.S. Electronic Futures Markets,“ examines the effects of large trades in futures markets. How quickly prices and liquidity recovers after large trades is an important characteristic of financial markets. The price effects of large trades are greater during the crisis period compared to the pre-crisis period. Furthermore, relative to the pre-crisis period, during the crisis period it takes more trades until liquidity returns to the pre-block trade levels. The third essay, entitled “Components of Quoted Bid-Ask Spreads in U.S. Electronic Futures Markets,” investigates the bid-ask spread components in futures market. The components of bid-ask spreads is one of the most important subjects of microstructure studies. Utilizing Huang and Stoll’s (1997) method the third essay of this dissertation provides the first analysis of the components of quoted bid-ask spreads in U.S. electronic futures markets. The results show that order processing cost is the largest component of bid-ask spreads, followed by inventory holding costs. During the crisis period market makers increase bid-ask spreads due to increasing inventory holding and adverse selection risks.

Essays on Emissions Trading Markets

This dissertation is a collection of three economics essays on different aspects of carbon emission trading markets. The first essay analyzes the dynamic optimal emission control strategies of two nations. With a potential to become the largest buyer under the Kyoto Protocol, the US is assumed to be a monopsony, whereas with a large number of tradable permits on hand Russia is assumed to be a monopoly. Optimal costs of emission control programs are estimated for both the countries under four different market scenarios: non-cooperative no trade, US monopsony, Russia monopoly, and cooperative trading. The US monopsony scenario is found to be the most Pareto cost efficient. The Pareto efficient outcome, however, would require the US to make side payments to Russia, which will even out the differences in the cost savings from cooperative behavior. The second essay analyzes the price dynamics of the Chicago Climate Exchange (CCX), a voluntary emissions trading market. By examining the volatility in market returns using AR-GARCH and Markov switching models, the study associates the market price fluctuations with two different political regimes of the US government. Further, the study also identifies a high volatility in the returns few months before the market collapse. Three possible regulatory and market-based forces are identified as probable causes of market volatility and its ultimate collapse. Organizers of other voluntary markets in the US and worldwide may closely watch for these regime switching forces in order to overcome emission market crashes. The third essay compares excess skewness and kurtosis in carbon prices between CCX and EU ETS (European Union Emission Trading Scheme) Phase I and II markets, by examining the tail behavior when market expectations exceed the threshold level. Dynamic extreme value theory is used to find out the mean price exceedence of the threshold levels and estimate the risk loss. The calculated risk measures suggest that CCX and EU ETS Phase I are extremely immature markets for a risk investor, whereas EU ETS Phase II is a more stable market that could develop as a mature carbon market in future years.