IDEAS home Printed from https://ideas.repec.org/a/spr/bioerq/v3y2018i4d10.1007_s41247-018-0048-1.html
   My bibliography  Save this article

A New Approach to Calculating the “Corporate” EROI

Author

Listed:
  • Luciano Celi

    (University of Trento
    National Research Council)

  • Claudio Della Volpe

    (University of Trento)

  • Luca Pardi

    (National Research Council)

  • Stefano Siboni

    (University of Trento)

Abstract

The EROI is one of the most important indices to evaluate the net energy output of a source of primary energy (there is a lively debate on the usability of this kind of parameter, but here we will use it under the hypothesis that it is a good way to establish if an oil company has a level of efficiency close to other energetic sources). It is generally defined as the ratio between the energy extracted by a given resource and the energy costs sustained to extract that energy. We tried to set up an alternative method for the calculation of the EROI, taking (1) as a proxy of the energy costs the available data about the CO2 emissions of the oil companies, as reported in the sustainability reports (SRs), recommended by the international organisms such as IPCC and WBCSD, although not mandatory, and (2) as a proxy of the energy extracted the CO2 emissions estimate obtained by a stoichiometric conversion of the oil/gas production declared by the oil companies. Both proxies have been also corrected to take into account the different CO2 emission rate per unit energy of oil and gas. The resulting estimates of EROI are rather homogeneous and not too different from the values reported in the literature. The method could be suitable for year-by-year comparison of the time evolution of this important energy quality parameter for the individual energy-producing and energy-delivering companies.

Suggested Citation

  • Luciano Celi & Claudio Della Volpe & Luca Pardi & Stefano Siboni, 2018. "A New Approach to Calculating the “Corporate” EROI," Biophysical Economics and Resource Quality, Springer, vol. 3(4), pages 1-28, December.
    • Handle: RePEc:spr:bioerq:v:3:y:2018:i:4:d:10.1007_s41247-018-0048-1
    DOI: 10.1007/s41247-018-0048-1
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s41247-018-0048-1
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s41247-018-0048-1?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Fizaine, Florian & Court, Victor, 2016. "Energy expenditure, economic growth, and the minimum EROI of society," Energy Policy, Elsevier, vol. 95(C), pages 172-186.
    2. Ajay K. Gupta & Charles A.S. Hall, 2011. "A Review of the Past and Current State of EROI Data," Sustainability, MDPI, vol. 3(10), pages 1-14, October.
    3. Nathan Gagnon & Charles A.S. Hall & Lysle Brinker, 2009. "A Preliminary Investigation of Energy Return on Energy Investment for Global Oil and Gas Production," Energies, MDPI, vol. 2(3), pages 1-14, July.
    4. Court, Victor & Fizaine, Florian, 2017. "Long-Term Estimates of the Energy-Return-on-Investment (EROI) of Coal, Oil, and Gas Global Productions," Ecological Economics, Elsevier, vol. 138(C), pages 145-159.
    5. Florian Fizaine Fizaine & Victor Court, 2016. "Energy expenditure,economicgrowth,andtheminimumEROI of society," Post-Print hal-01410625, HAL.
    6. Court, Victor & Fizaine, Florian, 2017. "Long-Term Estimates of the Energy-Return-on-Investment (EROI) of Coal, Oil, and Gas Global Productions," Ecological Economics, Elsevier, vol. 138(C), pages 145-159.
    7. Cleveland, Cutler J., 2005. "Net energy from the extraction of oil and gas in the United States," Energy, Elsevier, vol. 30(5), pages 769-782.
    8. Raugei, Marco & Leccisi, Enrica & Azzopardi, Brian & Jones, Christopher & Gilbert, Paul & Zhang, Lingxi & Zhou, Yutian & Mander, Sarah & Mancarella, Pierluigi, 2018. "A multi-disciplinary analysis of UK grid mix scenarios with large-scale PV deployment," Energy Policy, Elsevier, vol. 114(C), pages 51-62.
    9. Adam R. Brandt & Michael Dale, 2011. "A General Mathematical Framework for Calculating Systems-Scale Efficiency of Energy Extraction and Conversion: Energy Return on Investment (EROI) and Other Energy Return Ratios," Energies, MDPI, vol. 4(8), pages 1-35, August.
    10. David J. Murphy & Charles A.S. Hall & Michael Dale & Cutler Cleveland, 2011. "Order from Chaos: A Preliminary Protocol for Determining the EROI of Fuels," Sustainability, MDPI, vol. 3(10), pages 1-20, October.
    11. Cleveland, Cutler J., 1992. "Energy quality and energy surplus in the extraction of fossil fuels in the U.S," Ecological Economics, Elsevier, vol. 6(2), pages 139-162, October.
    12. Megan C. Guilford & Charles A.S. Hall & Peter O’Connor & Cutler J. Cleveland, 2011. "A New Long Term Assessment of Energy Return on Investment (EROI) for U.S. Oil and Gas Discovery and Production," Sustainability, MDPI, vol. 3(10), pages 1-22, October.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Luciano Celi, 2021. "Deriving EROI for Thirty Large Oil Companies Using the CO2 Proxy from 1999 to 2018," Biophysical Economics and Resource Quality, Springer, vol. 6(4), pages 1-12, December.
    2. Melgar-Melgar, Rigo E. & Hall, Charles A.S., 2020. "Why ecological economics needs to return to its roots: The biophysical foundation of socio-economic systems," Ecological Economics, Elsevier, vol. 169(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Delannoy, Louis & Longaretti, Pierre-Yves & Murphy, David J. & Prados, Emmanuel, 2021. "Peak oil and the low-carbon energy transition: A net-energy perspective," Applied Energy, Elsevier, vol. 304(C).
    2. David Grassian & Daniel Olsen, 2019. "Lifecycle Energy Accounting of Three Small Offshore Oil Fields," Energies, MDPI, vol. 12(14), pages 1-23, July.
    3. Adrien Fabre, 2018. "Evolution of EROIs of Electricity Until 2050: Estimation Using the Input-Output Model THEMIS," Policy Papers 2018.09, FAERE - French Association of Environmental and Resource Economists.
    4. Marco Vittorio Ecclesia & João Santos & Paul E. Brockway & Tiago Domingos, 2022. "A Comprehensive Societal Energy Return on Investment Study of Portugal Reveals a Low but Stable Value," Energies, MDPI, vol. 15(10), pages 1-22, May.
    5. Brandt, Adam R. & Yeskoo, Tim & Vafi, Kourosh, 2015. "Net energy analysis of Bakken crude oil production using a well-level engineering-based model," Energy, Elsevier, vol. 93(P2), pages 2191-2198.
    6. Lina I. Brand-Correa & Paul E. Brockway & Claire L. Copeland & Timothy J. Foxon & Anne Owen & Peter G. Taylor, 2017. "Developing an Input-Output Based Method to Estimate a National-Level Energy Return on Investment (EROI)," Energies, MDPI, vol. 10(4), pages 1-21, April.
    7. Salehi, Mohammad & Khajehpour, Hossein & Saboohi, Yadollah, 2020. "Extended Energy Return on Investment of multiproduct energy systems," Energy, Elsevier, vol. 192(C).
    8. Hall, Charles A.S. & Lambert, Jessica G. & Balogh, Stephen B., 2014. "EROI of different fuels and the implications for society," Energy Policy, Elsevier, vol. 64(C), pages 141-152.
    9. Fizaine, Florian & Court, Victor, 2015. "Renewable electricity producing technologies and metal depletion: A sensitivity analysis using the EROI," Ecological Economics, Elsevier, vol. 110(C), pages 106-118.
    10. Bartłomiej Bajan & Joanna Łukasiewicz & Agnieszka Poczta-Wajda & Walenty Poczta, 2021. "Edible Energy Production and Energy Return on Investment—Long-Term Analysis of Global Changes," Energies, MDPI, vol. 14(4), pages 1-16, February.
    11. Victor Court, 2019. "An Estimation of Different Minimum Exergy Return Ratios Required for Society," Biophysical Economics and Resource Quality, Springer, vol. 4(3), pages 1-13, September.
    12. Melgar-Melgar, Rigo E. & Hall, Charles A.S., 2020. "Why ecological economics needs to return to its roots: The biophysical foundation of socio-economic systems," Ecological Economics, Elsevier, vol. 169(C).
    13. Charles Guay-Boutet, 2023. "Estimating the Disaggregated Standard EROI of Canadian Oil Sands Extracted via Open-pit Mining, 1997–2016," Biophysical Economics and Resource Quality, Springer, vol. 8(1), pages 1-21, March.
    14. Zhaoyang Kong & Xiucheng Dong & Bo Xu & Rui Li & Qiang Yin & Cuifang Song, 2015. "EROI Analysis for Direct Coal Liquefaction without and with CCS: The Case of the Shenhua DCL Project in China," Energies, MDPI, vol. 8(2), pages 1-22, January.
    15. David J. Murphy & Marco Raugei & Michael Carbajales-Dale & Brenda Rubio Estrada, 2022. "Energy Return on Investment of Major Energy Carriers: Review and Harmonization," Sustainability, MDPI, vol. 14(12), pages 1-20, June.
    16. Kis, Zoltán & Pandya, Nikul & Koppelaar, Rembrandt H.E.M., 2018. "Electricity generation technologies: Comparison of materials use, energy return on investment, jobs creation and CO2 emissions reduction," Energy Policy, Elsevier, vol. 120(C), pages 144-157.
    17. Elise Dupont & Marc Germain & Hervé Jeanmart, 2021. "Estimate of the Societal Energy Return on Investment (EROI)," Biophysical Economics and Resource Quality, Springer, vol. 6(1), pages 1-14, March.
    18. Raugei, Marco & Fullana-i-Palmer, Pere & Fthenakis, Vasilis, 2012. "The energy return on energy investment (EROI) of photovoltaics: Methodology and comparisons with fossil fuel life cycles," Energy Policy, Elsevier, vol. 45(C), pages 576-582.
    19. Bo Xu & Lianyong Feng & William X. Wei & Yan Hu & Jianliang Wang, 2014. "A Preliminary Forecast of the Production Status of China’s Daqing Oil field from the Perspective of EROI," Sustainability, MDPI, vol. 6(11), pages 1-21, November.
    20. Alexandre Poisson & Charles A. S. Hall, 2013. "Time Series EROI for Canadian Oil and Gas," Energies, MDPI, vol. 6(11), pages 1-20, November.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:spr:bioerq:v:3:y:2018:i:4:d:10.1007_s41247-018-0048-1. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.