Investment In Energy Sector Research Articles

Evaluating energy poverty and its effects using multi-dimensional based DEA-like mathematical composite indicator approach: Findings from Asia

The objective of the study is to develop a multidimensional energy poverty index (EPI). The current study examines the impacts of multidimensional energy poverty indicators using mathematical composite index and, econometric models for five Asian countries. Multidimensional energy poverty indicator is used to evaluate the overall consequences of these region's energy poverty. It is estimated that EPI of Nepal region is 0.02, Sri Lanka composite score (CS) is 0.03, and Bangladesh's CS is 0.011, which are the maximum affected nations. In contrast, India's CS is above 0.88 and Pakistan's CS is above 0.49 and are expected to be the minimum energy poor. Of the total energy production, 79% is based on traditional fuels, followed by 12% based on petroleum products. Results further highlight the availability of electricity, the time it earns to obtain electricity, access to clean energy, and cooking technology have substantial positive relationship with region's EPI. Private investment in energy sector is a consistent negative component in EPI. In other economies, poverty headcount ratio coefficients are notably positive. Implemented energy policies and their impact on access to energy in South Asian region, highlight possible challenges but also benefits of the association between energy poverty and access to energy.

Most relevant factors and trends in energy cooperation between Kazakhstan and China, focused on renewable energy sources (RES)

This paper analyses the good political and legal environments, mutually beneficial strategic policy, along with level of economic development and growth, superior geographical conditions and cultural integration degree of the important effecting factors of the energy cooperation between Kazakhstan and China. By using the main points listed above this article refers to related trade and investment theories, and it’s divided into two aspects: Kazakhstan's export of Chinese energy products with time series data 1998-2014 and China's investment in Kazakhstan's energy sector with time series data 1998-2016 to construct the vector autoregressive model (VAR).We selected relevant variables and data to construct an econometric model from the perspectives of trade and investment to make an empirical analysis on the influencing factors of energy cooperation between Kazakhstan and China. Our results show that China's demand for large-scale market and for opening to the outside world as well as Kazakhstan’s great energy potential are the most important factors their cooperation. It can be stated that in our days Kazakh legislation is suitable for promoting the Chinese energy investments, but in the long run it would be beneficial to mobilize national capital especially in RES investments and research. In the end, we found the most important reserves in competitiveness of electricity and heat (both from fossil and renewable energy sources) are power grid consolidation and waste heat utilization in the short run. JEL CODE: F14; Q43

Prospects for China’s BRI and Strategic Influence in the Post-COVID-19 Central Asia

COVID-19 brings a momentous decline for global economic activities but its consequences for China’s Belt and Road Initiative (BRI) remains imminent. Despite the economic shocks of the Pandemic, BRI remains a top priority for China which allows Beijing to improve regional connectivity and expand its economic outreach far off to Europe and the American shores. On the other hand, the Central Asian economies are hard hit by the pandemic with a reduced regional trade, decline in oil prices and its commodities, deep slump in remittances, and the slackening manufacturing ability. The revival of BRI and its immediate success is desirable to the COVID-19 hit Central Asian economies. This is because BRI has bound the region together in terms of infrastructural development where China, under the rubric of BRI, is spearheading major developmental projects, pouring investment in energy sector, offering debt, and improving bilateral trade with regional economies. For this reason, the Central Asian countries desire immediate revival of close economic cooperation which could links the economic fortunes of regional countries to Beijing and brings the BRI to the fore in regional priorities. The paper highlight the impact of COVID-19 over Central Asian economies, the significance BRI for the region; its geopolitical importance for China; and the growing Chinese influence in the post-Pandemic Central Asia using Bourdieu’s Theory of Symbolic Power. Finally, using qualitative content analysis, the paper argues that the economic impact of COVID-19 are short-term and of limited nature and it will only increase prospects for BRI in the post-Pandemic Central Asia with vital strategic utilities for China’s geopolitical profile in the region.

Comprehensive functional data analysis of China’s dynamic energy security index

In the transition towards a cleaner and more sustainable global energy production and consumption, the energy security index (ESI) is an integral deciding factor for many countries. In this paper, the dynamics of China’s energy security index is constructed and analyzed using comprehensive functional data analysis (FDA) techniques. The energy security indices of 30 provinces in China between 2004 and 2017 are considered. The effect of investment (in energy sector) on energy security of the provinces is also checked using functional regression models. The average ESI for Shanxi (0.64737), Inner Mongolia (0.64540), and Shaanxi (0.51039), and the energy investment in Inner Mongolia, Shandong, and Shanxi form the top 10% of all the provinces considered. Exploratory analysis shows that there was an overall decrease in ESI in most of the provinces between 2004 and 2017, despite an increase in the investment in energy sectors of these provinces in the same period. The functional regression models show that investment in energy sector achieved its highest positive effect on energy security between year 2010 and 2014.

Determinants of Investments in Energy Sector in Poland

There is much research about the determinants of investments, but there is a shortage of similar studies for Poland. Therefore, the overall goal of the paper is to analyze the determinants of investments made by enterprises from the energy sector as well as their delays in Poland in the years 2000–2019. In this period, a strong growth of investments in energy was observed in the country. In connection to this, the authors set four hypotheses and verified them with the following statistical methods: canonical analysis, linear and causality correlation, autocorrelation and cointegration tests. The paper found that there is a relationship between public consumption and investment spending of small enterprises in Poland. That means that only some macroeconomic parameters are connected with investments. Moreover, the changes in the value of past investments has a negative influence in current investments.

China's outward foreign direct investment in energy sector: The role of "intimate" relations between countries.

Based on the data of China’s outward foreign direct investment (OFDI) in energy sector to 133 countries from 2005 to 2014, this paper uses a gravity model to investigate the impact of “intimate” relations on China’s OFDI locations in energy sector. We find that the “intimate” relations have significant effects on China’s OFDI locations in energy sector, namely: bilateral senior leaders’ visits, institutional distance, genetic distance, and immigration. Holding other factors fixed, for each one more bilateral senior leaders’ visit between China and the host country, China’s OFDI in energy sector for the host country will increase by 5.44%. If the genetic distance from China and host country increases by 1%, China’s OFDI in energy sector will fall by 1.69%. For every 1% increase in the institutional distance between China and host country, China’s energy OFDI will decrease by 1.09%. For every 1% increase in a country’s immigration to China, China’s energy OFDI will increase by 0.46%. Further, after distinguishing developed and developing countries, we find that compared with developed countries, “intimate” relations have greater impacts on China’s energy OFDI in developing countries. Finally, based on the dominance analysis, considering China’s “intimate” relations with countries along the “Belt and Road” and current locations of China’s OFDI, we find that China should further expand energy investment in countries along the “Belt and Road”.

An Empirical Analysis on China’s Energy sector Investments

Since the establishment of the People’s Republic of China, the energy sector has been growing for more than 70 years. During the process of industrialization and urbanization, China’s energy sector experienced numerous changes. As the energy sector has been increasingly affecting China’s economic structure, scholars at home and abroad have been constantly working on issues related it. Among them, one of the most important topics is related to investment in the energy sector. It is universally acknowledged that investment plays a fairly important role in improving the development an industry, including the energy sector. In order to analyze the characteristics of China’s investment in its energy sector from both regional and industrial dimensions, an overview of China’s energy sector was conducted and a few factors that could influence its development based on a literature review approach were analyzed. Additionally, an empirical analysis on China’s energy sector investment structure from 2004-2017 using entropy statistics was conducted. Entropy analysis of energy sector investment was performed in both the industrial dimension and the provincial dimension, aiming at providing a scene of energy investment allocation. Based on the entropy analysis of China’s energy sector investment during the period of 2004-2017, a discussion is presented on several factors that have influenced changes in China’s energy investments’ structure such as energy price, environmental regulation, resource endowment, and regional economic development situation. The findings point to 3 different kinds of energy investment portfolios in China, which are resource-based type, economy-based type and mix type. In addition, the energy investment portfolios of each type are affected by different factors in some way.

The impact of public-private partnerships Investment in Energy on carbon emissions: evidence from nonparametric causality-in-quantiles.

The current investigation examines causal relation between PPP investment in energy sector and CO2 emissions in selected developing countries by using non-parametric causality in quantiles and linear granger causality techniques. Range of the data is from January 1998 to December 2016. Although results obtained by linear granger causality test does not report any causal relation between PPP investment in energy and CO2 emissions, but findings from non-parametric test show that non-linear relationship exhibit between variables. The non-parametric outcomes indicate that PPP investment in non-renewable energy in the selected countries contribute to carbon emissions and thus degrade environment. And therefore, the need is to divert PPP investment to renewable energy where it is more effective. This investigation provides valuable information to policy-makers in developing countries to think out of box and address pressing environmental issues.

Проблемы и перспективы использования капитальных вложений в энергетике

Проблемы и перспективы использования капитальных вложений в энергетике

De-risking Renewable Energy Investments in Developing Countries: A Multilateral Guarantee Mechanism

Summary Mitigation of global warming requires substantial investment in electricity generation from renewable sources. A large share of new generation capacity is required in regions with adverse financing conditions. We propose a global guarantee mechanism to reduce risk premia of renewable energy investments by means of risk pooling and increased market efficiency. Policymakers could establish this mechanism by scaling up existing international risk guarantee initiatives. We estimate the net present value of overall savings at US$2018 1.5 trillion globally for investments by 2030, with the largest relative savings (between 20.5% and 22%) in Sub-Saharan Africa and the Maghreb. The savings from such a mechanism outweigh its estimated average yearly operating cost. By lowering the cost of decarbonization in high-risk countries, the proposed mechanism offers policymakers a tool to make current global mitigation pledges more achievable and enables the global community to pursue more ambitious climate action.

BRICS ON THE AFRICAN ENERGY MARKET: CURRENT SITUATION AND PROSPECTS FOR MUTUAL COOPERATION

The African energy market is one of the developing markets in search of foreign investments. The traditional investors, the EU and the USA, follow a policy inconsistent with the current situation – the emergence of new competitors, the BRICS countries. The purpose of the article is to assess the influence of the BRICS countries on the African energy market and to identify the extent of this influence. To this end, the authors have developed the presence index composed of the main indicators of the country's participation in the African energy market. The results are then interpreted, in order to reveal the most effective strategy of the BRICS energy cooperation on African issues. The authors have identified the main specific features of the energy market in Africa and the main characteristics of the energy strategies proposed to African countries by the main players on the energy market (including the EU and the USA). This allows to develop a strategy for African countries regarding the development of their national markets. The main hypothesis of the article is that the African economies should diversify their portfolio of energy sector investments, but introducing only those strategies that contribute to the growth of their economy.Keywords: Africa, energy, BRICS, strategy, green energy, developmentJEL Classifications: O55, Q40DOI: https://doi.org/10.32479/ijeep.9160

Renewables‐based decarbonization and relocation of iron and steel making: A case study

AbstractThe article assesses the future role of hydrogen‐based iron and steel making and its potential impact on global material flows, based on a combination of technology assessment, material flow analysis, and microeconomic analysis. Renewable hydrogen‐based iron production can become the least‐cost supply option at a carbon dioxide (CO2) price of around United States dollars (USD) 67 per tonne. Availability of low‐cost renewable electricity is a precondition. Australia is the world's largest producer of iron ore and at the same time a country with significant low‐cost renewable electricity potential. A shift to direct reduced iron (DRI) exports could reduce global CO2 emissions substantially and at the same time increase value added in Australia, while maintaining steel production in countries that are currently processing ore into iron and steel, such as China, South Korea, and Japan. The approach could be expanded to other parts of the world and other energy‐intensive industry sectors. Such relocation analysis in a climate context can become a new industrial ecology research area. Iron and steel industry CO2 emissions can be reduced by nearly a third, around 0.7 gigatonnes (Gt) CO2 per year. To achieve these emission reductions, investment of USD 0.9 trillion, or 0.7% of the total energy sector investment needs, would be required, global DRI production would have to increase seven‐fold from today's level, and the hydrogen energy used would equal 1% of global primary energy supply. Such a shift could develop from 2025 onward at scale, if the right policies are put in place.

Public-private partnerships investment in energy as new determinant of CO2 emissions: The role of technological innovations in China

This paper explores the relationship between ‘public-private partnerships investment in energy sector and carbon emissions’ considering the vital role of technological innovations in carbon emissions function for China. In doing so, we apply bootstrapping autoregressive distributed lag modeling (BARDL) for examining the cointegration between carbon emissions and its determinants. The empirical results reveal that public-private partnerships investment in energy impedes environmental quality by increasing carbon emissions. On contrary, technological innovations have negative effect on carbon emissions. The relationship between economic growth and carbon emissions is inverted-U shaped i.e. environmental Kuznets curve hypothesis. Exports are positively linked with carbon emissions. Foreign direct investment impedes environmental quality by stimulating CO2 emissions. The empirical findings provide new insights for policy makers to direct public-private partnerships investment in energy for the betterment of environmental quality in China.

Energy Transition Scenarios and Their Economic Impacts in the Extended Neoclassical Model of Economic Growth

Introduction: Energy return on energy invested (EROEI) of fossil fuels has been declining sharply, while modern renewable energy sources generally have even lower EROEI than fossil fuels. It has been repeatedly proven that economic growth expressed in the form of growth of real Gross Domestic Product (GDP) is closely related to intensified energy consumption and escalated usage of natural resources in general. This problem remains scarcely explored in pure economic modelling. Objectives: This study presents a novel model titled Energy Extended Neoclassical Growth Model (EENGM), which focuses on the consequences of declining quantity and quality of extractable fossil fuels and lower quality of the succeeding renewable energy technology for economic growth. Method: The Neoclassical growth model is translated into a system dynamics format and is extended by important feedback mechanisms, which are identified as important from the literature and mostly missing from the analyzed system dynamics models with a similar scope. Two scenarios assess the EENGM performance: business as usual (BAU) and the sustainability strategy (SUS). Results: Sensitivity analysis is performed for the Energy Return on Energy Invested (EROEI) parameter and results in the investment share in GDP varying between 27 and 40%, while the energy sector investment largely displaces investment in other economic sectors. The EENGM is associated with new behavior whereby the underperforming energy sector limits GDP growth and seizes most of the available investment. The adoption of the SUS strategy causes 28% lower cumulative fossil fuel aggregate consumption which still corresponds to higher than 1.5 °C global warming compared to the preindustrial levels. Conclusion: The share of consumption in the GDP of an economy undergoing energy transition can approach levels previously seen only in totally war-oriented economies. Even omitting other negative environmental feedback, the feasibility of the successful energy transition of the system in its contemporary form, with the currently available renewable energy technology, seems to be highly uncertain.

Low-carbon transition: Private sector investment in renewable energy projects in developing countries

• Dependence on fossil fuel reduces the hazard of private sector investment in renewable energy sector. • The role of fossil fuel dependence decreases in countries with prior investment projects. • Changes in oil price have competing effects on investment hazard. • Regulatory quality and renewable energy policies stimulate private sector investments in developing countries. Given the rapid population growth and subsequent increase in energy demand in developing countries, private sector investment in renewable energy projects is key for sustainable economic development. However, the current energy mix is still dependent on conventional fossil fuels. The paper examines the time duration to private sector investment in renewable energy projects and how the hazard rate is affected by dependence on fossil fuels. Using data on private sector participation in renewable energy projects in 134 developing and middle-income countries for the (1990–2012) period, this paper applies multiple failure time model. The results show significant negative effects of fossil fuel consumption and fuel rent on investment likelihood. Consistent with literature, a set of socio-economic variables, such as renewable energy policy and energy security concerns, play an important role in increasing the likelihood of private sector investment in renewable energy technologies. The findings of the paper resonate with concerns of the international community regarding the effect of fossil fuel dependence on the rate of adoption of renewable energy sources in developing countries.

Chinese Foreign Investments in the European Union Energy Sector: The Regulation of Security Concerns

Abstract Energy investments from China have been flowing into the European Union (EU) over the last decade at an increasing rate. Part of these investments are made under China’s Belt and Road Initiative (BRI) and involve Chinese State-owned Enterprises (SOEs). This flow of investments into critical sectors such as energy infrastructure and generation has raised considerable concern over their potential national security implications and prompted the European Commission to prepare new legislation to screen foreign investments in critical sectors, including energy. The new EU regulations complement existing investment screening mechanisms in a number of EU member states, and the application of EU merger control law. This article looks at the different screening and clearance mechanisms which Chinese investments in the energy sector may have to pass in the EU and aims to show how these screening mechanisms are used in practice.

Development of the Polish geothermal sector in the light of current possibilities of financial support for a geothermal investment

Geothermal energy is an internal heat of the Earth, that is a prospective and sustainable source of renewable energy. In Poland, despite having significant amount of low-temperature geothermal resources, its share in the national energy mix remains marginal but growing. Currently, the utilisation of geothermal resources is related to hydrogeothermal resources, that are used mainly in space heating, recreation and balneotherapy. Nevertheless, the indication of potential electricity production is under research. The utilisation of geothermal resources entails a plenty of environmental benefits that are particularly important in the context of the present pollution problem. Therefore, the development of the geothermal energy sector is of relevant importance and with appropriate legal and financial conditions it may have a bearing on improvement of the environment’s quality and, ipso facto, living in Poland. Thus, this paper presents numerous possibilities of obtaining a financial support for investments in geothermal energy sector. Selected funding and financial backing systems currently available in Poland are discussed. The importance of opportunity of obtaining a financial support for an investment as one of the crucial factors for the geothermal sector development is emphasised. Moreover, the examples of installations implemented in the country in the context of obtained funding are presented.

НАФТОГАЗОВИЙ ФАКТОР У ЗОВНІШНІЙ ПОЛІТИЦІ КРАЇН ЛАТИНСЬКОЇ АМЕРИКИ

Formulation of the problem. The authors analyze the current state and prospects for the development of the oil and gas complex and their role in the foreign policy of the Latin American states, policies of the use of oil and gas resources as a tool for enhancing influence in the region, as well as the functioning of multilateral oil supply agreements. The possibilities of realization of joint energy projects in Latin America are analyzed. The presence of oil and gas in the region has always been used as a political tool. The United States' reliance on Middle Eastern oil and the carbon emissions produced by the surging demand for fossil fuels in Asia tend to dominate discussions about the role of energy in U.S. foreign policy. But in recent years, the energy relationship between the United States and Latin America has perhaps become more important than other issues, as the largest share of the United States international trade and investment in the energy sector has occurred within the Western Hemisphere. Purpose of the researchis to study the role of the oil and gas complex in the foreign policy of Latin American countries. The oil and gas complex plays an important role in the foreign policy of Latin American countries. The Latin American energy market is quite attractive to transnational energy companies due to the huge volumes of cheap energy resources, the consumer market with growing energy demand. The energy markets of the Americas are deeply integrated. Despite the shale boom, which led to a sharp increase in U.S. oil production and a drop in imports, the United States still relies on Latin America for more than 30 percent of the oil it buys from abroad. The gas and gas complex part of the geological section is characterized by a similar lithological composition and the underlying rocks, containing oil and gas in industrial volumes. Research methods: The following research methods were used to address the issues set in the article: general scientific methods – descriptive, hermeneutic-political, systemic, structural-functional, comparative, institutional-comparative; general logical methods – empirical, statistical, prognostic modeling and analysis; special methods of political science. The preference was given to the method of political-system analysis, by which the common and distinctive characteristics of the basic components of immigration policy strategies were identified, reflecting existing political, public, information and other challenges for international relations and global development. The article of analysis. Latin America, a growing importer of U.S. natural gas and the largest market for U.S., makes refined petroleum products, such as gasoline. American oil companies and utilities are big investors in Argentina, Brazil, Mexico, and Venezuela, helping to develop the energy resources of all those countries. In Brazil, the United States direct investment in oil and gas extraction reached $2,4 billion in 2015; in Mexico, the figure was $420 million. Washington's financing and technical cooperation programs have further helped the development of new energy resources in the region. U.S. institutions and funds back up clean energy investments and provide regulatory and technical guidance to tap the region's shale fields.

Investments in Renewable Energy for Smart Grid Technology Development

The current state of economic development foreseen an increasing production processes efficiency and determines the demand for energy resources. At the same time, the global use of traditional energy sources is steadily growing and currently it is still dominant. Considering the empirical arguments regarding environmental degradation and problems related to climate change, the development and implementation of smart and safe energy technologies, such as the Smart Grid, is relevant. Smart and secure power grids today are seen as technologies that facilitate the transition of the energy system supply from traditional electrical networks to more sustainable and environmentally friendly operations. The article deals with theoretical and methodological approaches that reveal the essence of the Smart Grid concept, and analyzes the main areas of investment in such technologies. It is underlined that to ensure energy security and environmental sustainability of energy supply sector the generation of electric power should be based on the use of renewable energy sources. The long-run sustainability of energy sector in climate change conditions is guaranteed by forming deep links between renewable energy generation and Smart Grid technologies. The paper discusses the main factors which may influence the Smart Grid technology development. The investments in renewable energy are named to be the most important factor of Smart Grid technology development. The lack of investments is considered to be an important factor of poor energy efficiency in developing economies. In addition, the article focuses on European experience regarding the implementation of smart and safe energy systems based on renewable energy sources. It is underlined the best EU counties experience for Smart Grid technology development based on investments in renewable energy sector. Key words: Smart Grid, renewable energy, economic process, power network, energy supply, efficiency, investment.

Techno-economic optimisation of offshore wind farms based on life cycle cost analysis on the UK

Abstract In order to reduce the cost of energy per MWh in wind energy sector and support investment decisions, an optimisation methodology is developed and applied on Round 3 offshore zones, which are specific sites released by the Crown Estate for offshore wind farm deployments, and for each zone individually in the UK. The 8-objective optimisation problem includes five techno-economic Life Cycle Cost factors that are directly linked to the physical aspects of each location, where three different wind farm layouts and four types of turbines are considered. Optimal trade-offs are revealed by using NSGA II and sensitivity analysis is conducted for deeper insight for both industrial and policy-making purposes. Four optimum solutions were discovered in the range between £1.6 and £1.8 billion; the areas of Seagreen Alpha, East Anglia One and Hornsea Project One. The highly complex nature of the decision variables and their interdependencies were revealed, where the combinations of site-layout and site-turbine size captured above 20% of total Sobol indices in total cost. The proposed framework could also be applied to other sectors in order to increase investment confidence.