Product innovation and the costs of energy-using product policies

Energy-using Products (EuPs) contribute significantly to the United Kingdom’s CO2 emissions, both in the domestic and non-domestic sectors. Policies that encourage the use of more energy efficient products (such as minimum performance standards, energy labelling, enhanced capital allowances, etc.) can therefore generate significant reductions in overall energy consumption and hence, CO2 emissions. While these policies can impose costs on the producers and consumers of these products in the short run, the process of product innovation may reduce the magnitude of these costs over time. If this is the case, then it is important that the impacts of innovation are taken into account in policy impact assessments. Previous studies have found considerable evidence of experience curve effects for EuP categories (e.g. refrigerators, televisions, etc.), with learning rates of around 20% for both average unit costs and average prices; similar to those found for energy supply technologies. Moreover, the decline in production costs has been accompanied by a significant improvement in the energy efficiency of EuPs. Building on these findings and the results of an empirical analysis of UK sales data for a range of product categories, this paper sets out an analytic framework for assessing the impact of EuP policy interventions on consumers and producers which takes explicit account of the product innovation process. The impact of the product innovation process can be seen in the continuous evolution of the energy class profiles of EuP categories over time; with higher energy classes (e.g. A, A+, etc.) entering the market and increasing their market share, while lower classes (e.g. E, F, etc.) lose share and then leave the market. Furthermore, the average prices of individual energy classes have declined over their respective lives, while new classes have typically entered the market at successively lower “launch prices”. Based on two underlying assumptions regarding the shapes of the “lifecycle profiles” for the relative sales and the relative average mark-ups of individual energy classes, a simple simulation model is developed that can replicate the observed market dynamics in terms of the evolution of market shares and average prices. The model is used to assess the effect of two alternative EuP policy interventions – a minimum energy performance standard and an energy-labelling scheme – on the average unit cost trajectory and the average price trajectory of a typical EuP category, and hence the financial impacts on producers and consumers.

Internalising the external costs of light goods vehicle transport in Britain

To what extent do the taxes paid by the light goods vehicles (LGVs) users in Britain cover their allocated infrastructural, environmental and congestion costs? This report is a continuation of a study on the internalisation of the external costs of heavy goods vehicle activity. Research undertaken jointly by the Transport Studies Group at University of Westminster and Logistics Research Centre at Heriot-Watt University has attempted to answer this question using official government transport statistics and monetary valuations for the external costs.

The challenge of managing airline delay costs

Estimates of airline delay costs as a function of delay magnitude are combined with fuel and (future) emissions charges to make cost-benefit trade-offs in the pre-departure and airborne phases. Hypothetical scenarios for the distribution of flow management slots are explored in terms of their cost and target-setting implications. The general superiority of passenger-centric metrics is of significance for delay measurement, although flight delays are still the only commonly-reported type of metric in both the US and Europe. There is a particular need for further research into reactionary (network) effects, especially with regard to passenger metrics and flow management delay.

Modelling the airline costs of delay propagation

Reactionary delays constitute nearly half of all delay minutes in Europe. A capped, multi-component model is presented for estimating reactionary delay costs, as a non-linear function of primary delay duration. Maximum Take-Off Weights, historically established as a charging mechanism, may be used to model delay costs. Current industry reporting on delay is flight-centric. Passenger-centric metrics are needed to better understand delay propagation. In ATM, it is important to take account of contrasting flight- and passenger-centric effects, caused by cancellations, for example. Costs to airlines and passenger disutility will both continue to be driven by delay relative to the original schedule.

Does Cost-Effectiveness Analysis Have a Role in US Managed Care Drug Formularies? An Empirical Study of Utilization, Costs, Outcomes, and Elasticity of Demand of a Value-Based Formulary

Thesis (Ph.D.)--University of Washington, 2015

Improving health and wellbeing independently of GDP: dividends of greener and prosoical economies

Increases in gross domestic product (GDP) beyond a threshold of basic needs do not lead to further increases in well-being. An explanation is that material consumption (MC) also results in negative health externalities. We assess how these externalities influence six factors critical for well-being: (i) healthy food; (ii) active body; (iii) healthy mind; (iv) community links; (v) contact with nature; and (vi) attachment to possessions. If environmentally sustainable consumption (ESC) were increasingly substituted for MC, thus improving well-being and stocks of natural and social capital, and sustainable behaviours involving non-material consumption (SBs-NMC) became more prevalent, then well-being would increase regardless of levels of GDP. In the UK, the individualised annual health costs of negative consumption externalities (NCEs) currently amount to £62 billion for the National Health Service, and £184 billion for the economy (for mental ill-health, dementia, obesity, physical inactivity, diabetes, loneliness and cardiovascular disease). A dividend is available if substitution by ESC and SBs-NMC could limit the prevalence of these conditions.

A framework for evaluating the European airline costs of disabled persons and persons with reduced mobility

In recent years, airlines have been servicing a greater variety, and increasing numbers, of disabled persons and persons with reduced mobility (PRMs), particularly associated with ageing, obesity and medical needs. With the quantity of PRMs likely to increase in the future, there will be a growing impact on the airlines' associated actual and opportunity costs, about which there is minimal literature and data. Therefore the aim of this paper is to identify standard functional key factors (FKFs) with which airlines could audit their PRMs costs, and which could be used by other interested bodies, such as governments, when considering relevant aviation policy. These FKFs are related to nine areas, namely PRMs’ transfers; mobility aids; aircraft delays/diversions costs; staff training costs; staff health, safety and welfare; aircraft fixtures and equipment costs; airport costs; transaction costs; and opportunity costs. Further research is needed to obtain the data for these FKFs.

The costs of urban growth at the fringe of a Chinese city: evidence from Jinshi Village in Suzhou

The rate of city growth in China today correlates well with an overall loss of the most fertile agricultural areas of the country. A consequence of this growth includes the rapid reshaping of peri-urban livelihoods in their densely populated fringe. The policy response from central government has focused on containing city growth and pursuing modern rural development. Both policy directions have failed, in part, to acknowledge the intrinsic nature of the urban fringe in China. This paper explores the features of the fringe of Suzhou, a fast growing city in the Yangtze River Delta. The aim is to outline potential social costs of this current policy framework, through analysing the case study of Jinshi Village. The paper advocates a different regionalist approach to policy implementation.

Transmission costs allocation based on optimal re-dispatch

Congestion management of transmission power systems has achieve high relevance in competitive environments, which require an adequate approach both in technical and economic terms. This paper proposes a new methodology for congestion management and transmission tariff determination in deregulated electricity markets. The congestion management methodology is based on a reformulated optimal power flow, whose main goal is to obtain a feasible solution for the re-dispatch minimizing the changes in the transactions resulting from market operation. The proposed transmission tariffs consider the physical impact caused by each market agents in the transmission network. The final tariff considers existing system costs and also costs due to the initial congestion situation and losses. This paper includes a case study for the 118 bus IEEE test case.

Avaliação da rentabilidade económica dos sistemas de microgeração fotovoltaica em Portugal (1990-2010)

Dissertação para a obtenção do grau de Mestre em Engenharia Electrotécnica - ramo de Energia