With 90% of global CO2 emissions being energy-related, promoting the transition to renewable energy is the first task of green development. The Asia-Pacific region accounts for more than half of the world's energy consumption, although progress on energy transition is still being made slowly. Thus, this research examines the effects of natural extreme events and green innovation on the sustainable

This paper explores the influence of digitalisation on green preferences based on a theoretical approach by extending Busato et al.'s (2022) model. Environmental shocks, environmental status, quality of green digitalised information, and uncertainty avoidance conditions are also taken into account. The main results show that digitalisation can stimulate green preferences in clean environments in the

We evaluate US Energy Information Administration (EIA) forecasts of the world petroleum market, emphasising the importance of taking a multivariate perspective, considering asymmetric loss and allowing for time-variation. Forecasts for total demand, total supply, total stock withdrawals and the oil prices are biased, with biases that change over time and differ across variables. A loss function that

This paper introduces a novel framework of partial connectedness measures to investigate contagion dynamics between different types of oil price shocks and exchange rates. Oil price shocks are persistent net transmitters of shocks within the network. It is found that the oil shock net spillovers made up most of the net connectedness values in most countries during the pre-COVID-19 period. Both oil

Households adopt solar panels for different reasons, but usually with a reduced electricity bill in mind. However, the access to solar power at near zero marginal costs may well induce rebound effects which shift households’ demand curve and distort the net effects of solar PV investments. By analyzing high frequency data on household electricity consumption and production, we document solar PV rebound

Promoting plug-in electric vehicle (PEV) adoption through subsidies represents a commonly used policy lever for decarbonizing the light-duty vehicle sector. However, it is unclear how the subsidy cost-effectiveness has evolved over time and whether further subsidization is needed to induce adoption beyond wealthy consumers. We explore these questions by assessing the federal PEV subsidy program in

Introducing climate change policies such as carbon pricing can bring substantial costs for fossil-fuel-fired electricity generators, with incumbents often granted a transitional allocation of free emission permits. The free allocation of emission permits and the pass-through of carbon prices to higher electricity prices has created substantial concern that these policies allow emissions-intensive firms

We constructed a multilayer information spillover network containing a return spillover layer, a volatility spillover layer, and an extreme risk spillover layer to explore the system risk in the oil and G20 stock markets during 2006–2022. This paper explores the topology of the static and dynamic multilayer networks from both system-level and market-level perspectives. We find that: (i) At the system-level

The interconnectedness and high integration among the global markets have reduced the portfolio diversification opportunities of international investors. In view of this, considering the rise of Socially Responsible Investments (SRI) and the Clean-Renewable energy & Clean-Technology energy (C&RTE) asset classes, the objective of this research is to examine risk transmission and the portfolio diversification

Measuring the risk exposure of TSOs on the dispatching market is a crucial task for the correct management of liberalized electricity markets. To fill a gap in the literature, the notion of Cost-at-Risk (CaR) is defined in the context of the dispatching market. Moreover, we propose a set of semi-parametric and non-parametric models for the estimation of the Cost at Risk (CaR) for the Italian TSO (Terna)

This paper studies the impact of investor attention to oil prices on returns, volatility, and covariances of three exchange traded funds representing oil, gold, and the stock market. For this purpose, we suggest a new multivariate volatility model based on open, high, low, and closing prices that incorporates the impact of investor attention on returns, volatility, and covariances. We find that this

The standard approach to the Environmental Kuznets Curve (EKC) holds that as a country develops and GDP per capita grows environmental degradation initially increases but eventually it reaches a turning point where environmental degradation begins to decline. Environmental degradation takes many forms, one of them being emissions of harmful gases. According to the EKC concept, a country can reduce

Financial markets can support the transition to a low-carbon economy by redirecting funds from highly emissive to clean investments. We study whether European stock markets take carbon prices into account in company valuations and to what degree they discriminate between firms with different carbon intensities. Using a novel dataset containing stock prices and carbon intensities of 338 European publicly

The literature on the environment has analyzed how firms carry out R&D to reduce their pollutant emissions, assuming that they maximize profits. However, empirical evidence shows that firms are increasingly concerned about Environmental Corporate Social Responsibility (ECSR). Following that evidence, we consider that the objective function of firms incorporates the environmental damage they generate

Agencies that regulate electricity providers often apply nonparametric data envelopment analysis (DEA) to assess the relative efficiency of each firm. The reliability and validity of DEA are contingent upon selecting relevant input variables. In the era of big (wide) data, the assumptions of traditional variable selection techniques are often violated due to challenges related to high-dimensional data

Given that natural gas is a vital input for the U.S. utility sector, this study empirically investigates the return connectedness between the natural gas and utility stocks in the U.S. market. Using the quantile connectedness approach, we show that the nexus between natural gas and utility stocks is more pronounced at the tails compared to the central of the conditional distribution. The return connectedness

Using U.S. data, we investigate how the COVID-19 pandemic influences oil price returns in an asset pricing framework. Unlike earlier studies, we consider a threshold model to allow for the possibility that COVID-19 risk may not play a role until it reaches a certain level. Based on WTI crude oil spot price data from January 2020 to December 2021, our findings show that oil returns significantly decline

This paper empirically examines the impacts of grid-scale battery storage facilities on the frequency control ancillary services (FCAS) market that is used by energy market operators to maintain the frequency of the system within the normal operating band. Using a staggered introduction of grid-scale batteries in two Australian states, our difference-in-differences analysis shows that grid-scale batteries

The outlook of crude oil prices has sparsely been empirically examined especially from the critical perspectives of energy expenditure per household, retail electricity prices, and environmental indicators. Given the enormous macroeconomic and socioeconomic effects of crude oil price amidst the fundamentals, this study examines the dynamics of the oil price outlook amidst energy demand (measured by

Academics and policymakers generally agree that energy infrastructure should be subject to price regulation. More and more critics of modern regulatory approaches, however, point to the apparent failures of these mechanisms to achieve competitive pricing in practice. Some have suggested that customers ought to be involved in the regulatory process, but it is uncertain how customers' perspectives can

The paper proposes a full comprehensive analysis of green bond diversification benefits, their co-movement with multiple market indices, and the corresponding implications for portfolio allocation. Based on a time frame of seven years, divided into four sub-periods, the co-movements of green-bond indices, i.e. Solactive Green Bond Index and Bloomberg Barclays MSCI Green Bond Index, and the stock/bond

In response to climate change, Germany, like many other countries, has steadily expanded its electricity generation from renewables. Meanwhile, the ongoing trend towards regional products in other sectors raises questions regarding household consumers' preferences for regional electricity tariffs. While a few studies have concluded that regionality is a product attribute consumers prefer, little is

In our analysis of electricity price series from Australia's National Electricity Market (NEM), we employ the indicator saturation (IS) approach to simultaneously model the stylised facts of electricity prices, including extreme spikes, seasonality, level-shifts, and autocorrelation. The standard modelling methods described in the literature tend to use regime-switching models to cope with these characteristics

The importance of crude oil volatility and geopolitical risk for stock pricing is well known in both developed and emerging economies, but is relatively understudied in major oil-exporting countries at the sectoral level of stock indices and under various market conditions. Using daily data on eight Gulf Cooperation Council (GCC) stock sector indices over the period February 2010–30 June 2022, we capture

This paper examines the time-varying interactive linkages between the sustainable debt market and gas markets, applying unique estimation techniques, specifically the empirical mode decomposition (EMD)-windowed-cross-correlation (EMD-WCC) and wavelet-windowed-cross-correlations. To this end, we use the S&P Green Bond Index as a representative of a sustainable debt market while for the gas market, we

We investigate the economic, climate and electricity market implications of public bus fleet electrification based on the Melbourne Metropolitan region. We employ a novel fleet-level analysis, under tariff-based least-cost depot charging to compare the total cost of ownership (TCO) over 12 years of battery electric vehicle (BEV) against diesel bus fleets in a transitioning power sector. We also estimate

Modeling price risks is crucial for economic decision making in energy markets. Besides the risk associated with a single price, the dependence structure of multiple prices is often relevant. We therefore propose a generic and easy-to-implement method for generating multivariate probabilistic forecasts based on univariate point forecasts of day-ahead electricity prices. While each univariate point

Our research uses the environmental pillar of ESG as a proxy for environmental corporate social responsibility. We examine the performance of environmentally clustered portfolios by using simple quantitative investment strategies with optimum asset rotation. Post-hoc, sample-split analysis with non-parametric tests is performed. The results suggest that both environmental status and dynamic environmental

Climate policies aimed at reducing greenhouse gas emissions can lead to decreases in the values of assets, risking them to become “stranded”. We study the price effects of the introduction of a specific climate policy, a minimum energy efficiency standard, in the housing market. Leveraging a unique data set of the population of all residential house transactions in England and Wales, we show that prices

We model energy demand across five end-use sectors and 15 energy products in Saudi Arabia, generating comprehensive price and income elasticity estimates. Using the Structural Time Series Model, we demonstrate that the trends underlying energy demand are generally stochastic, underscoring the importance of using such models for estimating unbiased elasticities. Our estimates reveal that energy demand

In low-income countries, uneven access to clean energy poses a challenge to reducing socioeconomic inequalities across gender and disadvantaged groups. Development planners view the decentralised energy system (DES) as having the potential to help address this issue, because it provides electricity access in areas where the national electricity grid is not available. This study assesses whether the

Cryptocurrencies have been widely used as financial instruments over the past decade. Given the development of the cryptocurrency market and the increasing awareness of greener and more energy-efficient tokens, their connection to the green economy has become a popular topic for understanding economic and policy issues. However, the literature still lacks clear evidence on how cryptocurrencies interact

This paper extends the literature on energy-related financial literacy by examining its role in collective energy retrofit investment decisions in Soviet-era countries, which suffer from suboptimal levels of these investments, purportedly due to a lack of energy-specific knowledge and financial skills as well as low levels of trust. We investigate whether energy-related financial literacy and trust

The adverse effects of the high-power energy consumption by cryptocurrencies on the environment and sustainability have raised the interest of a large body of policymakers and market participants. We apply a network approach to investigate the dependency across clean energy, green markets, and cryptocurrencies from 1 January 2018 to 30 November 2021. Our results indicate that sustainable investments

Economic policy is a major determinant of investment and financial decisions; Moreover, prices of precious metals are highly influenced by any uncertainty recorded in the global economic policy. Therefore, the prime consideration of the authors is to assess how global economic policy uncertainty influences the volatility of precious metals prices; particularly “gold, palladium, platinum, and silver”

The purpose of this study is to investigate the influence of renewable energy research and development (R&D) investment and the environment-related technological innovations, on the quality of the environment of the G7 economies over a period spanning from 1990 to 2020. The role of economic growth, R&D, and human capital has also been examined. For this very purpose, Panel data approaches, such as

This paper studies linear cost-efficiency and quality incentives that are increasingly being used to regulate electricity and gas network utilities. The analysis shows that cost and quality incentives have asymmetric impacts on firms’ choices of efficiency and quality, and that the incentive powers should be equal and less than maximal when there is information asymmetry about firm costs and a dislike

To augment the relative prices of carbon content emeries to green energies, many governments have imposed carbon prices and proved subsidies to green energy production. Given the imperative role of green finance for global energy transitions, we investigate whether oil equity transmits any significant signal to green investments and vice-versa as substitute commodities. To this end, we apply three

We investigate how capacity payments in combination with scarcity pricing of energy can ensure resource adequacy in electricity markets, defined as the ability of supply and other resources to provide enough energy and capacity to meet demand under steady-state operating conditions. This work generalizes models for determining capacity payments by deriving second-best discriminatory payments by resource

This study investigates the effect of oil price uncertainty on unemployment rates by race and ethnicity. Oil price uncertainty is measured by using two alternative approaches: (1) implied oil price option volatility and (2) a structural vector autoregression with multivariate GARCH-in-Mean with the errors distributed multivariate-t. The findings indicate that increased oil price uncertainty strongly

The paper examines the interactions of downside risks between crude oil and the automobile sector through the employment of Diebold and Yilmaz (2012) and Diebold and Yılmaz (2014) framework in a static and time-varying perspective. The network connectedness is found to intensify during the periods of the Global Financial Crisis (2007-09) and the COVID-19 pandemic (2020-21). Crude oil remains a net

The environmental Kuznets curve (EKC) hypothesis, whereby pollution first increases then decreases as income increases along an inverted U-shaped path, has generated a large literature beginning in the 1990s. The current analysis contributes to that literature in two main ways, one theoretical and one empirical. First, the theoretical inquiry begins with the idea that a variety of societal parameters

Linking demand and supply management on the basis of public acceptance is essential to prepare for the energy transition from fossil fuels to environment friendly energy integration, and to ensure stability in electricity supply and demand management. Demand management could promote the conservation of energy resources by stabilizing electricity supplies and curbing consumer consumption, which could

This study contributes to the literature on whether financial development stimulates technical energy efficiency (TEE) or not, by addressing core biases that creep into the relationship and thereby reducing the ability to draw causal inferences from financial development to TEE. Our approach is based on the instrumental stochastic frontier technique, where biases in the frontier and inefficiency equations

The recent Sustainable Development Goals (SDG) 2022 progress report shows the presence of a possible policy lacuna at the global level in achieving the objectives of SDG 7. The recent COP26 discourse and the academic literature identify the Energy Transition as the possible mean to achieve this objective. Now, realizing the Energy Transition requires a conducive policy climate within the economies

As climate change has become an increasingly pressing threat, the active advent of green innovation and reducing environmental pollution have also become the driving forces for cleaner economic growth, and a healthier environment. In this regard, numerous research studies have identified all the different aspects that affect environmental pollution. However though, research studies have overlooked

In this paper, we devise an alternative environmental policy and design a dynamic environmental tax. The two key features of this approach are: (i) environmental tax is levied on a monopoly firm's emissions intensity (emissions per unit of output) rather than on the firm's total pollution emissions; and (ii) the pollution tax rate is a state variable whose dynamic equation is operationalized with an

We develop a framework to quantify the convenience yield risk (CYR) inherent to each commodity futures market. Implementing our approach, we document that our novel CYR measure is informative about future commodity returns. In panel regressions, the CYR predicts future returns with a positive sign. Economically, a strategy that opens long positions in commodity markets with a higher than median CYR

Reducing the vulnerability of the energy system can help safeguard the normal functioning of the economy and society and promote the transition to a green, low-carbon system, which in turn has a potential impact on the global greenhouse effect. To explore the causal relationship between energy vulnerability and CO2 emissions, this study first constructs a composite energy vulnerability index (EVI)

This paper investigates the green stock market reaction to climate policy events associated with the Paris Agreement and the U.S. presidential elections. We document abnormal returns, volatility and volume reactions to climate policy events among green stocks. However, the magnitude of the reactions varies between the tightening and loosening of climate policy and across subgroups of the green stock

In the backdrop of the recent covid-19 pandemic there is a renewed interest to understand the interlinkages between dirty and clean energies. In this regard, the study examines the co-movement structure between clean energy stocks and dirty energies before and during the covid-19 outbreak. The study analyses the interlinkages between the underlying markets by utilizing a vast sample of dirty energies

This paper studies the relationship between monetary policy and CO2 emissions. Our contribution is twofold: (i) we present a stylized dynamic AD-AS model with Global Value Chains (GVC) and carbon emissions to illustrate this relationship, (ii) we estimate the effect of monetary policy on emissions using the GVAR methodology, which explicitly considers the interconnection between regions instead of

We analyze the impact of oil price shocks on three unique fixed income asset classes representing conventional bonds, Islamic bonds (sukuks) and green bonds by employing network dynamic connectedness framework. Our sample period ranges from May 1, 2009, to March 1, 2022, covering the aftermath of global financial crisis, subsequent boom and bust of oil markets and the COVID-19 pandemic. We document

Despite efforts and commitments to achieve universal coverage of electricity, overall access in Africa is below expectation, making the attainment of the United Nations' Sustainable Energy for All Initiative almost a mirage for this region. The inability to mobilize adequate domestic financial resources and a seeming lack of political will (reflected in governance) have been highlighted as two of the

In this paper, we investigate the predictability of technical indicators on energy futures volatility from the high-frequency and high-dimensional perspectives. We show that the technical indicators have significant impacts on crude oil and natural gas futures volatility based on in- and out-of-sample analysis. Further, we analyze the impacts of interactions among predictor variables on future volatility

The complexity of the EU carbon neutrality policy is addressed by evaluating the impacts of the interaction among different policy instruments. An energy-economic dynamic CGE model based on GTAP utilities is developed for simulating different policy scenarios starting from a business as usual case where the economic impacts related to the COVID-19 pandemic and recovery measures are included. The instruments

The analysis of future energy systems with increasing shares of renewable energy production poses various challenges to the models used in the field of energy system analysis. Aggregation is one solution to reduce the computation time of large optimisation problems, especially for optimisation models with endogenous capacity expansion. Since the economic viability of renewable investments is not directly