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Tangible and fungible energy: Hybrid energy market and currency system for total energy management. A Masdar City case study

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  • Sgouridis, Sgouris
  • Kennedy, Scott

Abstract

We propose the introduction of an energy-based parallel currency as a means to ease the transition to energy-conscious living. Abundant fossil energy resources mask the internal and external energy costs for casual energy consumers. This situation is challenging communities that draw a significant fraction of their primary energy consumption from renewable energy sources. The Masdar Energy Credit (MEC) system is a way of translating the fundamental aspects behind energy generation and usage into a tangible reality for all users with built-in fungibility to incentivize collectively sustainable behavior. The energy credit currency (ergo) corresponds with a chosen unit of energy so that the total amount of ergos issued equals the energy supply of the community. Ergos are distributed to users (residents, commercial entities, employees, and visitors) on a subscription basis and can be surrendered in exchange for the energy content of a service. A spot market pricing mechanism is introduced to relate ergos to "fiat" currency using a continuously variable exchange rate to prevent depletion of the sustainable energy resource. The MEC system is intended to: (i) meet the sustainable energy balance targets of a community (ii) support peak shaving or load shifting goals, and (iii) raise energy awareness.

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  • Sgouridis, Sgouris & Kennedy, Scott, 2010. "Tangible and fungible energy: Hybrid energy market and currency system for total energy management. A Masdar City case study," Energy Policy, Elsevier, vol. 38(4), pages 1749-1758, April.
    • Handle: RePEc:eee:enepol:v:38:y:2010:i:4:p:1749-1758
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    References listed on IDEAS

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    2. Mihaylov, Mihail & Rădulescu, Roxana & Razo-Zapata, Iván & Jurado, Sergio & Arco, Leticia & Avellana, Narcís & Nowé, Ann, 2019. "Comparing stakeholder incentives across state-of-the-art renewable support mechanisms," Renewable Energy, Elsevier, vol. 131(C), pages 689-699.
    3. Abbas Hassan & Hyowon Lee, 2015. "The paradox of the sustainable city: definitions and examples," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 17(6), pages 1267-1285, December.
    4. Almansoori, Ali & Betancourt-Torcat, Alberto, 2015. "Design optimization model for the integration of renewable and nuclear energy in the United Arab Emirates’ power system," Applied Energy, Elsevier, vol. 148(C), pages 234-251.
    5. Kennedy, Scott & Sgouridis, Sgouris, 2011. "Rigorous classification and carbon accounting principles for low and Zero Carbon Cities," Energy Policy, Elsevier, vol. 39(9), pages 5259-5268, September.
    6. Yigitcanlar, Tan & Han, Hoon & Kamruzzaman, Md. & Ioppolo, Giuseppe & Sabatini-Marques, Jamile, 2019. "The making of smart cities: Are Songdo, Masdar, Amsterdam, San Francisco and Brisbane the best we could build?," Land Use Policy, Elsevier, vol. 88(C).
    7. Marinakis, Vangelis & Doukas, Haris & Karakosta, Charikleia & Psarras, John, 2013. "An integrated system for buildings’ energy-efficient automation: Application in the tertiary sector," Applied Energy, Elsevier, vol. 101(C), pages 6-14.
    8. Koasidis, Konstantinos & Marinakis, Vangelis & Nikas, Alexandros & Chira, Katerina & Flamos, Alexandros & Doukas, Haris, 2022. "Monetising behavioural change as a policy measure to support energy management in the residential sector: A case study in Greece," Energy Policy, Elsevier, vol. 161(C).

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