IDEAS home Printed from https://ideas.repec.org/p/pra/mprapa/119374.html
   My bibliography  Save this paper

Energising EU Cohesion: Powering up lagging regions in the renewable energy transition

Author

Listed:
  • Többen, Johannes
  • Banning, Maximilian
  • Hembach-Stunden, Katharina
  • Stöver, Britta
  • Ulrich, Philip
  • Schwab, Thomas

Abstract

The European Green Deal mandates a substantial transformation of the energy sector, responsible for more than 80 % of total greenhouse gas emissions. This study investigates the economic implica-tions of achieving climate neutrality in the European energy sector in light of the EU's core goal of economic cohesion, i.e. harmonious economic development across European regions. Employing a novel multi-regional input-output model, our analysis reveals how the renewable energy transition affects European regions. Under complete decarbonisation, changes in value added per capita range from -2,450 Euro to +1,570 Euro, and employment levels fluctuate between -2.1 % and +4.9 %. On average, most regions experience positive effects, characterised by an average increase in value added per capita of 10 Euro and a 0.3 % rise in employment in 2050. Overall, rural regions with sub-stantial renewable energy potential derive the greatest benefits, while urban regions heavily reliant on carbon-intensive industries are more likely to experience adverse effects. This dynamic fosters economic cohesion by providing opportunities for lagging regions to catch up, yet also poses fresh challenges to achieving this goal. Therefore, cohesion policy must expand its scope to counter the adverse effects as well as leveraging opportunities created by the renewable energy transition in all European regions.

Suggested Citation

  • Többen, Johannes & Banning, Maximilian & Hembach-Stunden, Katharina & Stöver, Britta & Ulrich, Philip & Schwab, Thomas, 2023. "Energising EU Cohesion: Powering up lagging regions in the renewable energy transition," MPRA Paper 119374, University Library of Munich, Germany.
    • Handle: RePEc:pra:mprapa:119374
    as

    Download full text from publisher

    File URL: https://mpra.ub.uni-muenchen.de/119374/1/MPRA_paper_119373.pdf
    File Function: original version
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Óscar Dejuán & Ferran Portella-Carbó & Mateo Ortiz, 2022. "Economic and environmental impacts of decarbonisation through a hybrid MRIO multiplier-accelerator model," Economic Systems Research, Taylor & Francis Journals, vol. 34(1), pages 1-21, January.
    2. Sievers, Luisa & Breitschopf, Barbara & Pfaff, Matthias & Schaffer, Axel, 2019. "Macroeconomic impact of the German energy transition and its distribution by sectors and regions," Ecological Economics, Elsevier, vol. 160(C), pages 191-204.
    3. Julianne DeAngelo & Inês Azevedo & John Bistline & Leon Clarke & Gunnar Luderer & Edward Byers & Steven J. Davis, 2021. "Energy systems in scenarios at net-zero CO2 emissions," Nature Communications, Nature, vol. 12(1), pages 1-10, December.
    4. Xin Su & Frédéric Ghersi & Fei Teng & Gaëlle Le Treut & Meicong Liang, 2022. "The economic impact of a deep decarbonisation pathway for China: a hybrid model analysis through bottom-up and top-down linking," Post-Print hal-03897206, HAL.
    5. Staffell, Iain & Pfenninger, Stefan, 2016. "Using bias-corrected reanalysis to simulate current and future wind power output," Energy, Elsevier, vol. 114(C), pages 1224-1239.
    6. Zoi Vrontisi & Kostas Fragkiadakis & Maria Kannavou & Pantelis Capros, 2020. "Energy system transition and macroeconomic impacts of a European decarbonization action towards a below 2 °C climate stabilization," Climatic Change, Springer, vol. 162(4), pages 1857-1875, October.
    7. Ewelina Kochanek, 2021. "The Energy Transition in the Visegrad Group Countries," Energies, MDPI, vol. 14(8), pages 1-13, April.
    8. Pfenninger, Stefan & Staffell, Iain, 2016. "Long-term patterns of European PV output using 30 years of validated hourly reanalysis and satellite data," Energy, Elsevier, vol. 114(C), pages 1251-1265.
    9. Kirsten Svenja Wiebe & Eivind Lekve Bjelle & Johannes Többen & Richard Wood, 2018. "Implementing exogenous scenarios in a global MRIO model for the estimation of future environmental footprints," Journal of Economic Structures, Springer;Pan-Pacific Association of Input-Output Studies (PAPAIOS), vol. 7(1), pages 1-18, December.
    10. Bianco, Vincenzo & Cascetta, Furio & Marino, Alfonso & Nardini, Sergio, 2019. "Understanding energy consumption and carbon emissions in Europe: A focus on inequality issues," Energy, Elsevier, vol. 170(C), pages 120-130.
    11. O'Sullivan, Marlene & Edler, Dietmar, 2020. "Gross Employment Effects in the Renewable Energy Industry in Germany : An Input–Output Analysis from 2000 to 2018," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 12(15).
    12. Mark Thissen & Maureen Lankhuizen & Frank (F.G.) van Oort & Bart Los & Dario Diodato, 2018. "EUREGIO: The construction of a global IO DATABASE with regional detail for Europe for 2000-2010," Tinbergen Institute Discussion Papers 18-084/VI, Tinbergen Institute.
    13. Xin Su & Frédéric Ghersi & Fei Teng & Gaëlle Treut & Meicong Liang, 2022. "The economic impact of a deep decarbonisation pathway for China: a hybrid model analysis through bottom-up and top-down linking," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 27(1), pages 1-37, January.
    14. Jan-Philipp Sasse & Evelina Trutnevyte, 2023. "A low-carbon electricity sector in Europe risks sustaining regional inequalities in benefits and vulnerabilities," Nature Communications, Nature, vol. 14(1), pages 1-15, December.
    Full references (including those not matched with items on IDEAS)

    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. Onodera, Hiroaki & Delage, Rémi & Nakata, Toshihiko, 2024. "The role of regional renewable energy integration in electricity decarbonization—A case study of Japan," Applied Energy, Elsevier, vol. 363(C).
    2. Behrang Shirizadeh & Philippe Quirion, 2023. "Long-term optimization of the hydrogen-electricity nexus in France," Post-Print hal-04347126, HAL.
    3. Marko Hočevar & Lovrenc Novak & Primož Drešar & Gašper Rak, 2022. "The Status Quo and Future of Hydropower in Slovenia," Energies, MDPI, vol. 15(19), pages 1-13, September.
    4. Lukas Kriechbaum & Philipp Gradl & Romeo Reichenhauser & Thomas Kienberger, 2020. "Modelling Grid Constraints in a Multi-Energy Municipal Energy System Using Cumulative Exergy Consumption Minimisation," Energies, MDPI, vol. 13(15), pages 1-23, July.
    5. Behrang Shirizadeh, Quentin Perrier, and Philippe Quirion, 2022. "How Sensitive are Optimal Fully Renewable Power Systems to Technology Cost Uncertainty?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
    6. Omoyele, Olalekan & Hoffmann, Maximilian & Koivisto, Matti & Larrañeta, Miguel & Weinand, Jann Michael & Linßen, Jochen & Stolten, Detlef, 2024. "Increasing the resolution of solar and wind time series for energy system modeling: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 189(PB).
    7. Liu, Hailiang & Andresen, Gorm Bruun & Greiner, Martin, 2018. "Cost-optimal design of a simplified highly renewable Chinese electricity network," Energy, Elsevier, vol. 147(C), pages 534-546.
    8. Géremi Gilson Dranka & Paula Ferreira, 2020. "Electric Vehicles and Biofuels Synergies in the Brazilian Energy System," Energies, MDPI, vol. 13(17), pages 1-22, August.
    9. Shirizadeh, Behrang & Quirion, Philippe, 2022. "The importance of renewable gas in achieving carbon-neutrality: Insights from an energy system optimization model," Energy, Elsevier, vol. 255(C).
    10. Gorre, Jachin & Ortloff, Felix & van Leeuwen, Charlotte, 2019. "Production costs for synthetic methane in 2030 and 2050 of an optimized Power-to-Gas plant with intermediate hydrogen storage," Applied Energy, Elsevier, vol. 253(C), pages 1-1.
    11. Shirizadeh, Behrang & Quirion, Philippe, 2021. "Low-carbon options for the French power sector: What role for renewables, nuclear energy and carbon capture and storage?," Energy Economics, Elsevier, vol. 95(C).
    12. Ringkjøb, Hans-Kristian & Haugan, Peter M. & Nybø, Astrid, 2020. "Transitioning remote Arctic settlements to renewable energy systems – A modelling study of Longyearbyen, Svalbard," Applied Energy, Elsevier, vol. 258(C).
    13. Petrelli, Marina & Fioriti, Davide & Berizzi, Alberto & Bovo, Cristian & Poli, Davide, 2021. "A novel multi-objective method with online Pareto pruning for multi-year optimization of rural microgrids," Applied Energy, Elsevier, vol. 299(C).
    14. Gianluigi Migliavacca & Marco Rossi & Dario Siface & Matteo Marzoli & Hakan Ergun & Raúl Rodríguez-Sánchez & Maxime Hanot & Guillaume Leclerq & Nuno Amaro & Aleksandr Egorov & Jawana Gabrielski & Björ, 2021. "The Innovative FlexPlan Grid-Planning Methodology: How Storage and Flexible Resources Could Help in De-Bottlenecking the European System," Energies, MDPI, vol. 14(4), pages 1-28, February.
    15. Dan Tong & David J. Farnham & Lei Duan & Qiang Zhang & Nathan S. Lewis & Ken Caldeira & Steven J. Davis, 2021. "Geophysical constraints on the reliability of solar and wind power worldwide," Nature Communications, Nature, vol. 12(1), pages 1-12, December.
    16. Gyanwali, Khem & Komiyama, Ryoichi & Fujii, Yasumasa, 2020. "Representing hydropower in the dynamic power sector model and assessing clean energy deployment in the power generation mix of Nepal," Energy, Elsevier, vol. 202(C).
    17. Gabrielli, Paolo & Aboutalebi, Reyhaneh & Sansavini, Giovanni, 2022. "Mitigating financial risk of corporate power purchase agreements via portfolio optimization," Energy Economics, Elsevier, vol. 109(C).
    18. Sven Teske & Thomas Pregger & Sonja Simon & Tobias Naegler & Johannes Pagenkopf & Özcan Deniz & Bent van den Adel & Kate Dooley & Malte Meinshausen, 2021. "It Is Still Possible to Achieve the Paris Climate Agreement: Regional, Sectoral, and Land-Use Pathways," Energies, MDPI, vol. 14(8), pages 1-25, April.
    19. Vijay, Avinash & Fouquet, Nicolas & Staffell, Iain & Hawkes, Adam, 2017. "The value of electricity and reserve services in low carbon electricity systems," Applied Energy, Elsevier, vol. 201(C), pages 111-123.
    20. Stute, Judith & Klobasa, Marian, 2024. "How do dynamic electricity tariffs and different grid charge designs interact? - Implications for residential consumers and grid reinforcement requirements," Energy Policy, Elsevier, vol. 189(C).

    More about this item

    Keywords

    energy; transition; cohesion; inequality; regions;
    All these keywords.

    JEL classification:

    • C67 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Input-Output Models
    • O11 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Macroeconomic Analyses of Economic Development
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    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:pra:mprapa:119374. 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: Joachim Winter (email available below). General contact details of provider: https://edirc.repec.org/data/vfmunde.html .

    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.