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Promoting Renewable Energy in Europe: A Hybrid Computable General Equilibrium Approach

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  • Christoph Bohringer and Andreas Loschel

Abstract

We illustrate the use of a large-scale computable general equilibrium model to investigate the economic and environmental effects of renewable energy promotion within the European Union. Our hybrid model incorporates the technological explicitness of bottom-up energy system models for the electricity sector while production possibilities in other sectors are described at an aggregate level through top-down constant-elasticities-of-substitution (transformation) functions. The discrete activity analysis of technology options within conventional top-down computable general equilibrium models is possible when adopting the so-called mixed complementarity problem approach Ð a flexible mathematical representation of market equilibrium conditions which accommodates weak inequalities and complementary slackness.

Suggested Citation

  • Christoph Bohringer and Andreas Loschel, 2006. "Promoting Renewable Energy in Europe: A Hybrid Computable General Equilibrium Approach," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 135-150.
    • Handle: RePEc:aen:journl:2006se_jaccard-a07
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    Cited by:

    1. Ahmadi, Somayeh & Saboohi, Yadollah & Vakili, Ali, 2021. "Frameworks, quantitative indicators, characters, and modeling approaches to analysis of energy system resilience: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 144(C).
    2. Susana Silva & Isabel Soares & Carlos Pinho, 2012. "The Impact of Renewable Energy Sources on Economic Growth and CO2 Emissions - a SVAR approach," European Research Studies Journal, European Research Studies Journal, vol. 0(4), pages 133-144.
    3. Meng, Sam & Siriwardana, Mahinda & McNeill, Judith & Nelson, Tim, 2018. "The impact of an ETS on the Australian energy sector: An integrated CGE and electricity modelling approach," Energy Economics, Elsevier, vol. 69(C), pages 213-224.
    4. Pierre, Cayet & Catherine, Azzaro-Pantel & Sylvain, Bourjade & Catherine, Muller-Vibes, 2024. "Beyond the “bottom-up” and “top-down” controversy: A methodological inquiry into hybrid modeling methods for hydrogen supply chains," International Journal of Production Economics, Elsevier, vol. 268(C).
    5. Dannenberg, Astrid & Mennel, Tim & Moslener, Ulf, 2008. "What does Europe pay for clean energy?--Review of macroeconomic simulation studies," Energy Policy, Elsevier, vol. 36(4), pages 1318-1330, April.
    6. Miguel Pérez de Arce and Enzo Sauma, 2016. "Comparison of Incentive Policies for Renewable Energy in an Oligopolistic Market with Price-Responsive Demand," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    7. Aleksandra Matuszewska-Janica & Dorota Żebrowska-Suchodolska & Urszula Ala-Karvia & Marta Hozer-Koćmiel, 2021. "Changes in Electricity Production from Renewable Energy Sources in the European Union Countries in 2005–2019," Energies, MDPI, vol. 14(19), pages 1-27, October.
    8. Raei, Hasan & Maleki, Abbas & Farajzadeh, Zakariya, 2024. "Analysis of energy policy reform in Iran: Energy and emission intensity changes," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 1535-1557.
    9. Xavier Labandeira, Pedro Linares and Miguel Rodriguez, 2009. "An Integrated Approach to Simulate the impacts of Carbon Emissions Trading Schemes," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    10. Aleksandra Matuszewska-Janica & Dorota Żebrowska-Suchodolska & Agnieszka Mazur-Dudzińska, 2021. "The Situation of Households on the Energy Market in the European Union: Consumption, Prices, and Renewable Energy," Energies, MDPI, vol. 14(19), pages 1-21, October.
    11. Murphy, Rose & Rivers, Nic & Jaccard, Mark, 2007. "Hybrid modeling of industrial energy consumption and greenhouse gas emissions with an application to Canada," Energy Economics, Elsevier, vol. 29(4), pages 826-846, July.
    12. Landis,Florian & Timilsina,Govinda R., 2015. "The economics of policy instruments to stimulate wind power in Brazil," Policy Research Working Paper Series 7346, The World Bank.
    13. Gjorgiev, Blazhe & Garrison, Jared B. & Han, Xuejiao & Landis, Florian & van Nieuwkoop, Renger & Raycheva, Elena & Schwarz, Marius & Yan, Xuqian & Demiray, Turhan & Hug, Gabriela & Sansavini, Giovanni, 2022. "Nexus-e: A platform of interfaced high-resolution models for energy-economic assessments of future electricity systems," Applied Energy, Elsevier, vol. 307(C).
    14. Hübler, Michael & Löschel, Andreas, 2013. "The EU Decarbonisation Roadmap 2050—What way to walk?," Energy Policy, Elsevier, vol. 55(C), pages 190-207.
    15. repec:grz:wpaper:2013-02 is not listed on IDEAS
    16. Jing Wang & Yubing Xu, 2022. "How Does Digitalization Affect Haze Pollution? The Mediating Role of Energy Consumption," IJERPH, MDPI, vol. 19(18), pages 1-15, September.
    17. Inha Oh & Yeongjun Yeo & Jeong-Dong Lee, 2015. "Efficiency versus Equality: Comparing Design Options for Indirect Emissions Accounting in the Korean Emissions Trading Scheme," Sustainability, MDPI, vol. 7(11), pages 1-21, November.
    18. repec:ers:journl:v:xv:y:2012:i:sie:p:133-144 is not listed on IDEAS
    19. Carmen-Valentina Radulescu & Ioan I. Gaf-Deac & Florina Bran & Catalin-Octavian Manescu & Dumitru Alexandru Bodislav & Sorin Burlacu, 2023. "The Mix of Resources, Security and Sustainability of the Energy Complex in Romania in the European Context," The AMFITEATRU ECONOMIC journal, Academy of Economic Studies - Bucharest, Romania, vol. 25(63), pages 447-447, April.
    20. Inha Oh & Wang-Jin Yoo & Kihwan Kim, 2020. "Economic Effects of Renewable Energy Expansion Policy: Computable General Equilibrium Analysis for Korea," IJERPH, MDPI, vol. 17(13), pages 1-21, July.

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