Measuring the impact of clean energy production on CO2 abatement in Denmark: Upper bound estimation and forecasting*

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Measuring the impact of clean energy production on CO2 abatement in Denmark : Upper bound estimation and forecasting*. / Christensen, Bent Jesper; Datta Gupta, Nabanita; Santucci de Magistris, Paolo.

I: Journal of the Royal Statistical Society. Series A: Statistics in Society, Bind 184, Nr. 1, 01.2021, s. 118-149.

Publikation: Bidrag til tidsskrift/Konferencebidrag i tidsskrift /Bidrag til avisTidsskriftartikelForskningpeer review

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@article{3db892f29e5d4904bbbd8e24c3fe8145,
title = "Measuring the impact of clean energy production on CO2 abatement in Denmark: Upper bound estimation and forecasting*",
abstract = "Using annual data from 1978 through 2016, and monthly data from January 2005 through November 2017 from Denmark, we provide a precise estimate of the upper bound on the potential impact of the adoption of wind energy on the reduction of (Formula presented.) emissions from energy production. We separate causal impacts from endogenous effects in regressions using instrumental variables including average wind speed, and from spurious effects in dynamic systems using impulse-response analysis and cointegration techniques. A one percentage point increase in the share of wind in total energy production is found to cause a reduction in (Formula presented.) emissions of the order 0.3%, based on endogeneity-corrected regression, and 0.5% over 2 years in a fractional vector error-correction model, after allowing the cumulative effects to take place. This corresponds to an upper bound estimate of 0.69 tonnes of (Formula presented.) emissions avoided per additional MWh of wind energy produced. We find that after a structural break at the time of introduction of the EU ETS and the Kyoto Protocol in 2005, the country has been on track towards meeting its long-term goals for emission reduction and green energy production, but not before.",
keywords = "abatement, causal effect, emissions, fractional cointegration, renewable energy",
author = "Christensen, {Bent Jesper} and {Datta Gupta}, Nabanita and {Santucci de Magistris}, Paolo",
note = "Funding Information: *We are grateful to David Hendry, Bent Nielsen, Felix Pretis and other participants at the 2nd Conference on the Econometrics of Climate Change, Oxford, for useful comments. We also thank John Cappelen, Danish Meteorological Institute, and Ole‐Kenneth Nielsen, Department of Environmental Science–Emission Modeling and Environmental Geography, Aarhus University, for advice and for allowing access to some of the data used in this study. Research support was provided by the Danish Social Science Research Council and the Center for Research in Econometric Analysis of TimE Series (CREATES), which is funded by the Danish National Research Foundation (grant number DNRF78). The authors declare no competing interests, financially or otherwise, with any organizations or individuals. Publisher Copyright: {\textcopyright} 2020 Royal Statistical Society Copyright: Copyright 2020 Elsevier B.V., All rights reserved.",
year = "2021",
month = jan,
doi = "10.1111/rssa.12616",
language = "English",
volume = "184",
pages = "118--149",
journal = "Journal of the Royal Statistical Society, Series A (Statistics in Society)",
issn = "0964-1998",
publisher = "John Wiley & Sons, Inc.",
number = "1",

}

RIS

TY - JOUR

T1 - Measuring the impact of clean energy production on CO2 abatement in Denmark

T2 - Upper bound estimation and forecasting*

AU - Christensen, Bent Jesper

AU - Datta Gupta, Nabanita

AU - Santucci de Magistris, Paolo

N1 - Funding Information: *We are grateful to David Hendry, Bent Nielsen, Felix Pretis and other participants at the 2nd Conference on the Econometrics of Climate Change, Oxford, for useful comments. We also thank John Cappelen, Danish Meteorological Institute, and Ole‐Kenneth Nielsen, Department of Environmental Science–Emission Modeling and Environmental Geography, Aarhus University, for advice and for allowing access to some of the data used in this study. Research support was provided by the Danish Social Science Research Council and the Center for Research in Econometric Analysis of TimE Series (CREATES), which is funded by the Danish National Research Foundation (grant number DNRF78). The authors declare no competing interests, financially or otherwise, with any organizations or individuals. Publisher Copyright: © 2020 Royal Statistical Society Copyright: Copyright 2020 Elsevier B.V., All rights reserved.

PY - 2021/1

Y1 - 2021/1

N2 - Using annual data from 1978 through 2016, and monthly data from January 2005 through November 2017 from Denmark, we provide a precise estimate of the upper bound on the potential impact of the adoption of wind energy on the reduction of (Formula presented.) emissions from energy production. We separate causal impacts from endogenous effects in regressions using instrumental variables including average wind speed, and from spurious effects in dynamic systems using impulse-response analysis and cointegration techniques. A one percentage point increase in the share of wind in total energy production is found to cause a reduction in (Formula presented.) emissions of the order 0.3%, based on endogeneity-corrected regression, and 0.5% over 2 years in a fractional vector error-correction model, after allowing the cumulative effects to take place. This corresponds to an upper bound estimate of 0.69 tonnes of (Formula presented.) emissions avoided per additional MWh of wind energy produced. We find that after a structural break at the time of introduction of the EU ETS and the Kyoto Protocol in 2005, the country has been on track towards meeting its long-term goals for emission reduction and green energy production, but not before.

AB - Using annual data from 1978 through 2016, and monthly data from January 2005 through November 2017 from Denmark, we provide a precise estimate of the upper bound on the potential impact of the adoption of wind energy on the reduction of (Formula presented.) emissions from energy production. We separate causal impacts from endogenous effects in regressions using instrumental variables including average wind speed, and from spurious effects in dynamic systems using impulse-response analysis and cointegration techniques. A one percentage point increase in the share of wind in total energy production is found to cause a reduction in (Formula presented.) emissions of the order 0.3%, based on endogeneity-corrected regression, and 0.5% over 2 years in a fractional vector error-correction model, after allowing the cumulative effects to take place. This corresponds to an upper bound estimate of 0.69 tonnes of (Formula presented.) emissions avoided per additional MWh of wind energy produced. We find that after a structural break at the time of introduction of the EU ETS and the Kyoto Protocol in 2005, the country has been on track towards meeting its long-term goals for emission reduction and green energy production, but not before.

KW - abatement

KW - causal effect

KW - emissions

KW - fractional cointegration

KW - renewable energy

UR - http://www.scopus.com/inward/record.url?scp=85094669385&partnerID=8YFLogxK

U2 - 10.1111/rssa.12616

DO - 10.1111/rssa.12616

M3 - Journal article

AN - SCOPUS:85094669385

VL - 184

SP - 118

EP - 149

JO - Journal of the Royal Statistical Society, Series A (Statistics in Society)

JF - Journal of the Royal Statistical Society, Series A (Statistics in Society)

SN - 0964-1998

IS - 1

ER -