On Interfuel Substitution : Some International Evidence

This paper estimates interfuel substitution elasticities in selected developing and industrialized economies at the national and sector levels. In doing so, it employs state-of-the-art techniques in microeconometrics, particularly the locally flexi...

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Main Authors:	Serletis, Apostolos, Timilsina, Govinda, Vasetsky, Olexandr
Format:	Policy Research Working Paper
Language:	English
Published:	2012
Subjects:	APPROACH AVAILABILITY CARBON CARBON DIOXIDE CARBON DIOXIDE EMISSIONS CARBON EMISSIONS CLEAN ENERGY CLIMATE CHANGE CLIMATE CHANGE POLICY COAL COAL PRICE CONSUMER DEMAND CRUDE OIL DEMAND FOR ENERGY DEMAND FUNCTIONS DIESEL ELASTICITY OF SUBSTITUTION ELECTRICITY ELECTRICITY GENERATION ELECTRICITY PRICES ENERGY CONSUMPTION ENERGY DEMAND ENERGY DEMAND ANALYSIS ENERGY ECONOMICS ENERGY INPUT ENERGY POLICY ENERGY PRICES ENERGY PROBLEM EXPENDITURE FOSSIL FOSSIL FUEL FOSSIL FUELS FUEL FUEL OIL FUEL PRICE FUEL PRICES FUEL QUANTITIES FUEL TYPES FUELS GAS GASOLINE GASOLINE PRICE HIGH SULPHUR HIGH SULPHUR FUEL OIL HIGH-SULPHUR HOUSEHOLD SECTOR INCOME INPUT PRICES INTERNATIONAL ENERGY AGENCY LIGHT FUEL OIL NATURAL GAS NATURAL GAS PRICES NATURAL RESOURCES OIL OIL EQUIVALENT OIL PRICE OIL PRICES PETROLEUM PETROLEUM PRODUCTS PRICE CHANGE PRICE CHANGES PRICE ELASTICITIES PRICE ELASTICITY PRICE INCREASES PRICE INDEX PRICE OF COAL PRICE OF ELECTRICITY PRICE OF GAS PRICE OF GASOLINE PRICE OF OIL QUANTITY OF FUEL SOURCE OF ENERGY STEAM COAL SUBSTITUTE SUBSTITUTES SUPPLY FUNCTIONS WORLD ENERGY
Online Access:	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090831140422 http://hdl.handle.net/10986/4226

id	okr-10986-4226
recordtype	oai_dc
spelling	okr-10986-42262021-04-23T14:02:16Z On Interfuel Substitution : Some International Evidence Serletis, Apostolos Timilsina, Govinda Vasetsky, Olexandr APPROACH AVAILABILITY CARBON CARBON DIOXIDE CARBON DIOXIDE EMISSIONS CARBON EMISSIONS CLEAN ENERGY CLIMATE CHANGE CLIMATE CHANGE POLICY COAL COAL PRICE CONSUMER DEMAND CRUDE OIL DEMAND FOR ENERGY DEMAND FUNCTIONS DIESEL ELASTICITY OF SUBSTITUTION ELECTRICITY ELECTRICITY GENERATION ELECTRICITY PRICES ENERGY CONSUMPTION ENERGY DEMAND ENERGY DEMAND ANALYSIS ENERGY ECONOMICS ENERGY INPUT ENERGY POLICY ENERGY PRICES ENERGY PROBLEM EXPENDITURE FOSSIL FOSSIL FUEL FOSSIL FUELS FUEL FUEL OIL FUEL PRICE FUEL PRICES FUEL QUANTITIES FUEL TYPES FUELS GAS GASOLINE GASOLINE PRICE HIGH SULPHUR HIGH SULPHUR FUEL OIL HIGH-SULPHUR HOUSEHOLD SECTOR INCOME INPUT PRICES INTERNATIONAL ENERGY AGENCY LIGHT FUEL OIL NATURAL GAS NATURAL GAS PRICES NATURAL RESOURCES OIL OIL EQUIVALENT OIL PRICE OIL PRICES PETROLEUM PETROLEUM PRODUCTS PRICE CHANGE PRICE CHANGES PRICE ELASTICITIES PRICE ELASTICITY PRICE INCREASES PRICE INDEX PRICE OF COAL PRICE OF ELECTRICITY PRICE OF GAS PRICE OF GASOLINE PRICE OF OIL QUANTITY OF FUEL SOURCE OF ENERGY STEAM COAL SUBSTITUTE SUBSTITUTES SUPPLY FUNCTIONS WORLD ENERGY This paper estimates interfuel substitution elasticities in selected developing and industrialized economies at the national and sector levels. In doing so, it employs state-of-the-art techniques in microeconometrics, particularly the locally flexible normalized quadratic functional forms, and provides evidence consistent with neoclassical microeconomic theory. The results indicate that the interfuel substitution elasticities are consistently below unity, revealing the limited ability to substitute between major energy commodities (i.e., coal, oil, gas, and electricity). While the study finds some evidences of larger interfuel substitution potential in high-income economies as compared to that in the middle- and low-income economies in the industrial and transportation sectors, no such evidence is observed in the residential and electricity generation sectors or at the national level. The implication is that interfuel substitution depends on the structure of the economy, not the level of economic development. Moreover, a higher change in relative prices is needed to induce switching toward a lower carbon economy. 2012-03-19T19:12:11Z 2012-03-19T19:12:11Z 2009-08-01 http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090831140422 http://hdl.handle.net/10986/4226 English Policy Research working paper ; no. WPS 5026 CC BY 3.0 IGO http://creativecommons.org/licenses/by/3.0/igo/ World Bank Publications & Research :: Policy Research Working Paper The World Region The World Region
repository_type	Digital Repository
institution_category	Foreign Institution
institution	Digital Repositories
building	World Bank Open Knowledge Repository
collection	World Bank
language	English
topic	APPROACH AVAILABILITY CARBON CARBON DIOXIDE CARBON DIOXIDE EMISSIONS CARBON EMISSIONS CLEAN ENERGY CLIMATE CHANGE CLIMATE CHANGE POLICY COAL COAL PRICE CONSUMER DEMAND CRUDE OIL DEMAND FOR ENERGY DEMAND FUNCTIONS DIESEL ELASTICITY OF SUBSTITUTION ELECTRICITY ELECTRICITY GENERATION ELECTRICITY PRICES ENERGY CONSUMPTION ENERGY DEMAND ENERGY DEMAND ANALYSIS ENERGY ECONOMICS ENERGY INPUT ENERGY POLICY ENERGY PRICES ENERGY PROBLEM EXPENDITURE FOSSIL FOSSIL FUEL FOSSIL FUELS FUEL FUEL OIL FUEL PRICE FUEL PRICES FUEL QUANTITIES FUEL TYPES FUELS GAS GASOLINE GASOLINE PRICE HIGH SULPHUR HIGH SULPHUR FUEL OIL HIGH-SULPHUR HOUSEHOLD SECTOR INCOME INPUT PRICES INTERNATIONAL ENERGY AGENCY LIGHT FUEL OIL NATURAL GAS NATURAL GAS PRICES NATURAL RESOURCES OIL OIL EQUIVALENT OIL PRICE OIL PRICES PETROLEUM PETROLEUM PRODUCTS PRICE CHANGE PRICE CHANGES PRICE ELASTICITIES PRICE ELASTICITY PRICE INCREASES PRICE INDEX PRICE OF COAL PRICE OF ELECTRICITY PRICE OF GAS PRICE OF GASOLINE PRICE OF OIL QUANTITY OF FUEL SOURCE OF ENERGY STEAM COAL SUBSTITUTE SUBSTITUTES SUPPLY FUNCTIONS WORLD ENERGY
spellingShingle	APPROACH AVAILABILITY CARBON CARBON DIOXIDE CARBON DIOXIDE EMISSIONS CARBON EMISSIONS CLEAN ENERGY CLIMATE CHANGE CLIMATE CHANGE POLICY COAL COAL PRICE CONSUMER DEMAND CRUDE OIL DEMAND FOR ENERGY DEMAND FUNCTIONS DIESEL ELASTICITY OF SUBSTITUTION ELECTRICITY ELECTRICITY GENERATION ELECTRICITY PRICES ENERGY CONSUMPTION ENERGY DEMAND ENERGY DEMAND ANALYSIS ENERGY ECONOMICS ENERGY INPUT ENERGY POLICY ENERGY PRICES ENERGY PROBLEM EXPENDITURE FOSSIL FOSSIL FUEL FOSSIL FUELS FUEL FUEL OIL FUEL PRICE FUEL PRICES FUEL QUANTITIES FUEL TYPES FUELS GAS GASOLINE GASOLINE PRICE HIGH SULPHUR HIGH SULPHUR FUEL OIL HIGH-SULPHUR HOUSEHOLD SECTOR INCOME INPUT PRICES INTERNATIONAL ENERGY AGENCY LIGHT FUEL OIL NATURAL GAS NATURAL GAS PRICES NATURAL RESOURCES OIL OIL EQUIVALENT OIL PRICE OIL PRICES PETROLEUM PETROLEUM PRODUCTS PRICE CHANGE PRICE CHANGES PRICE ELASTICITIES PRICE ELASTICITY PRICE INCREASES PRICE INDEX PRICE OF COAL PRICE OF ELECTRICITY PRICE OF GAS PRICE OF GASOLINE PRICE OF OIL QUANTITY OF FUEL SOURCE OF ENERGY STEAM COAL SUBSTITUTE SUBSTITUTES SUPPLY FUNCTIONS WORLD ENERGY Serletis, Apostolos Timilsina, Govinda Vasetsky, Olexandr On Interfuel Substitution : Some International Evidence
geographic_facet	The World Region The World Region
relation	Policy Research working paper ; no. WPS 5026
description	This paper estimates interfuel substitution elasticities in selected developing and industrialized economies at the national and sector levels. In doing so, it employs state-of-the-art techniques in microeconometrics, particularly the locally flexible normalized quadratic functional forms, and provides evidence consistent with neoclassical microeconomic theory. The results indicate that the interfuel substitution elasticities are consistently below unity, revealing the limited ability to substitute between major energy commodities (i.e., coal, oil, gas, and electricity). While the study finds some evidences of larger interfuel substitution potential in high-income economies as compared to that in the middle- and low-income economies in the industrial and transportation sectors, no such evidence is observed in the residential and electricity generation sectors or at the national level. The implication is that interfuel substitution depends on the structure of the economy, not the level of economic development. Moreover, a higher change in relative prices is needed to induce switching toward a lower carbon economy.
format	Publications & Research :: Policy Research Working Paper
author	Serletis, Apostolos Timilsina, Govinda Vasetsky, Olexandr
author_facet	Serletis, Apostolos Timilsina, Govinda Vasetsky, Olexandr
author_sort	Serletis, Apostolos
title	On Interfuel Substitution : Some International Evidence
title_short	On Interfuel Substitution : Some International Evidence
title_full	On Interfuel Substitution : Some International Evidence
title_fullStr	On Interfuel Substitution : Some International Evidence
title_full_unstemmed	On Interfuel Substitution : Some International Evidence
title_sort	on interfuel substitution : some international evidence
publishDate	2012
url	http://www-wds.worldbank.org/external/default/main?menuPK=64187510&pagePK=64193027&piPK=64187937&theSitePK=523679&menuPK=64187510&searchMenuPK=64187283&siteName=WDS&entityID=000158349_20090831140422 http://hdl.handle.net/10986/4226
_version_	1764390493719887872

On Interfuel Substitution : Some International Evidence

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