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Energy Journal Issue

The Energy Journal
Volume 6, Number 4



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Change and Continuity

P. H. Frankel

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-1View Abstract

Abstract:
This award, which elevates me to the ranks of its previous distin-guished recipients, gives me great pleasure, especially since I am the first non-American to receive it. This in itself is an indication of the ever-widening scope of the Association. It comes to me at the end of a long life devoted to our industry. It is almost sixty years since I entered it as a junior business executive ... It is now forty years since I wrote my first book, appropriately titled Essentials of Petroleum, and almost thirty years since I left business to make my hobby my job when I formed Petroleum Economics Ltd., an international consulting firm.




Energy and Economy: Global Interdependences

William W. Hogan

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-2View Abstract

Abstract:
This meeting, the Seventh International Conference of the International Association of Energy Economists (IAEE), finds us again in the midst of transitions in energy markets. Continued adjustments in oil demand, natural gas bubbles in Europe and North America, closures of refineries, and concerns about acid rain are just a few of the issues that reflect the turbulence and continued change in energy concerns and policy. This list of challenges suggests opportunities for energy economists to contribute their special perspectives to the clarification of issues and options. At an international conference, we can reinforce communications across national boundaries as we consider our related problems.




Oil and Rival Energy Sources

P. C. Despraries

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-3View Abstract

Abstract:
Mr. President, Very Honorable Minister Jochimsen, Ladies and Gentlemen:Several weeks ago, when my friend Jane Carter so greatly honored me by inviting me to make this talk, she mentioned my "unique" experience with international oil and energy markets. This word unique seems to me to be a good semantic example of overstatement such as is fairly rarely found in English except when required by specific circumstances. We are all unique in this room. The president-elect of your association invited me to take off for the summits and to describe from up there the wonderful countryside of our Earth, irrigated by the economy and lit up by energy, the two sources of mankind's wealth and the subject of this conference. But when I began to spread my wings, I found that the countryside beneath me was extraordinarily familiar and that it was hard to find much of anything to describe that you had not already depicted yourselves hundreds of times.




Validating Allocation Functions in Energy Models: An Experimental Methodology

V. Kerry Smith and Lawrence J. Hill

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-4View Abstract

Abstract:
In the late 1970s, the Energy Information Administration initiated a program calling for review and evaluation of its data and validation of energy models used in support of the policymaking process. One of the more controversial aspects of this program was the effort to validate the large-scale energy models developed under DOE auspices and, in some cases, still under development. As all participants in this process (i.e., modelers and evaluators) acknowledge, there is no absolute standard by which a model can be validated. By definition, a model is an approximation to some real-world process. It abstracts from the complexities of the process but is intended to capture essential dimensions of the forces governing outcomes of that process. Consequently, all evaluations of a model involve judgment. To illustrate the prospects for divergent yet individually sensible judgments of an energy model, consider a recent appraisal of the Regional Demand Forecasting Model (RDFOR).




A Survey of Canadian Energy Policy: 1974-1983

Robert N. McRae

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-5View Abstract

Abstract:
Canadian energy policies have been strongly influenced by external events. Like most other countries of the world, Canada adjusted its energy policies in reaction to the OPEC oil price shocks of 1973-1974 and 1979. Canadian energy policies also have been influenced by U.S. energy policies (through trade links) and by the dominant presence of many foreign-controlled multinational petroleum firms.




Residential Energy Use in the OECD

Lee Schipper and Andrea N. Ketoff

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-6View Abstract

Abstract:
In this article we describe the evolution of residential energy use in OECD countries over the 1970-1982 period. We focus on European countries but refer also to findings for the United States, Canada, and Japan. We quantify the changes in energy consumption (particularly those that occurred in response to the great price shocks of 1973-1974 and 1979-1981), assess the permanency of these changes through 1982, and speculate on trends through 1983 on the basis of preliminary data. This analysis summarizes the results of a continuing project (Schipper, Ketoff, and Kahane, 1985) to identify, analyze, and monitor residential energy use in nearly a dozen OECD countries (Canada, Denmark, France, West Germany, Italy, Japan, Norway, Sweden, the United Kingdom, and the United States).




Modeling Energy Conservation Programs: An Application to Natural Gas Utilities

Adam Rose

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-7View Abstract

Abstract:
In recent years conservation received a great deal of attention from energy managers at all levels. Some conservation measures were undertaken voluntarily because they were profitable. Others were adopted to comply with regulations, many of which were intended to reduce social costs of energy production and delivery. The 1970s have been characterized as the era of natural gas shortages, and conservation represented one of many reasonable alternatives for utilities confronted by potential and actual excess demand.




On the Use of Double-Log Forms in Energy Demand Analysis

Andre Plourde and David Ryan

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-8View Abstract

Abstract:
The double-logarithmic demand function has been used widely in static energy demand studies. Recent examples include studies of electricity demand by Betancourt (1981) and Dias-Bandaranaike and Munasinghe (1983), of petroleum consumption by Brown (1983), and natural gas demand by Gowdy (1983). In this paper we examine some theoretical issues on the use of these functional forms in energy demand analysis and note a few related problems. Our analysis draws from the study by Dias-Bandaranaike and Munasinghe (1983) (hereafter DBM) recently published in The Energy Journal, Volume 4, Number 2. We concentrate on this paper for several reasons. First, it examines some of the theoretical underpinnings of double-log demand functions. Second, the authors claim that one of the contributions of their study is "[an] approach ... to derive demand functions [that] could be used to derive similar functions for other types of goods and services, besides electricity". Third, their study inadvertently reveals a number of problems that arise when the overriding concern is obtaining demand equations of the double-log form.




Demand for Electricity of Small Nonresidential Customers under Time-Of-Use (TOU) Pricing

Chi-Keung Woo

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-9View Abstract

Abstract:
After the oil crisis of 1973, the California Public Utilities Commission (CPUC) in 1976 ordered Pacific Gas and Electric Company (PGandE) to charge its large nonresidential customers with monthly billing demand of over 4000 kilowatts (kW) mandatory time-of-use rates. Using a translog (TLOG) specification attributable to Christensen, Jorgenson, and Lau (1973), Chung and Aigner (1981) estimate the electricity demand price elasticities by time-of-use for 64 of these customers in 13 Standard Industrial Classification (SIC) code groups. Own-price elasticity estimates are generally around -0.1 and at times can be as high as -0.5, or they have the wrong sign. Cross-price elasticity estimates indicate that electricity usages by time-of-use are mostly substitutes. However, the estimated price responsiveness typically is larger than observed usages (see below and the section, Experimental Design and Data). Moreover, positive own-price elasticity estimates, though not statistically significant, raise further doubts about the validity of empirical results.




Natural Gas from Seaweed: Is Near-Term R&D Funding by the U.S. Gas Industry Warranted?

Chennat Gopalakrishnan

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-10View Abstract

Abstract:
This paper is the result of a study of critical factors the Gas Research Institute (GRI) needed to consider in deciding whether to continue R&D funding of a Marine Biomass Project (M BP). The mission of this project is to determine the commercial feasibility of large marine biomass farms for methane conversion and to develop such farms if they prove viable (Aquaculture Associates, 1982).




Energy, Economics, and Foregin Policy in the Soviet Union

Arthur W. Wright

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-11View Abstract

Abstract:
This paper is the result of a study of critical factors the Gas Research Institute (GRI) needed to consider in deciding whether to continue R&D funding of a Marine Biomass Project (M BP). The mission of this project is to determine the commercial feasibility of large marine biomass farms for methane conversion and to develop such farms if they prove viable (Aquaculture Associates, 1982).




Modeling and Measuring Natural Resource Substitution

William A. Donnelly

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-12View Abstract

Abstract:
This paper is the result of a study of critical factors the Gas Research Institute (GRI) needed to consider in deciding whether to continue R&D funding of a Marine Biomass Project (M BP). The mission of this project is to determine the commercial feasibility of large marine biomass farms for methane conversion and to develop such farms if they prove viable (Aquaculture Associates, 1982).




Energy, Foresight, and Strategy

Mark Newton Lowry

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-13View Abstract

Abstract:
This paper is the result of a study of critical factors the Gas Research Institute (GRI) needed to consider in deciding whether to continue R&D funding of a Marine Biomass Project (M BP). The mission of this project is to determine the commercial feasibility of large marine biomass farms for methane conversion and to develop such farms if they prove viable (Aquaculture Associates, 1982).




Fuelwood in Urban Markets: A Case Study of Hyderabad

Ruthann C. Moomy

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-14View Abstract

Abstract:
This paper is the result of a study of critical factors the Gas Research Institute (GRI) needed to consider in deciding whether to continue R&D funding of a Marine Biomass Project (M BP). The mission of this project is to determine the commercial feasibility of large marine biomass farms for methane conversion and to develop such farms if they prove viable (Aquaculture Associates, 1982).




Bioenergy and Economic Development

Ruthann C. Moomy

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-15View Abstract

Abstract:
This paper is the result of a study of critical factors the Gas Research Institute (GRI) needed to consider in deciding whether to continue R&D funding of a Marine Biomass Project (M BP). The mission of this project is to determine the commercial feasibility of large marine biomass farms for methane conversion and to develop such farms if they prove viable (Aquaculture Associates, 1982).




Acknowledgments

DOI: 10.5547/ISSN0195-6574-EJ-Vol6-No4-16View Abstract

Abstract:
This paper is the result of a study of critical factors the Gas Research Institute (GRI) needed to consider in deciding whether to continue R&D funding of a Marine Biomass Project (M BP). The mission of this project is to determine the commercial feasibility of large marine biomass farms for methane conversion and to develop such farms if they prove viable (Aquaculture Associates, 1982).