Final energy demand in Portugal: How persistent it is and why it matters for environmental policy

José Belbute
Authors registered in the RePEc Author Service: Alfredo Marvao Pereira

CEFAGE-UE Working Papers from University of Evora, CEFAGE-UE (Portugal)

Abstract: The objective of this paper is to analyze the degree of persistence of final energy demand in Portugal. Our results suggest the presence of a strong level of persistence for aggregate final energy demand. Final demand for gas is the most persistent component of energy demand, while the final demand for coal is the least persistent. In turn, final demand for petroleum and biomass tend to have levels of persistence similar to aggregate final demand. The case of final demand for electricity is inconclusive. These results have the important implication for the design of environmental policies. First, the fact that final energy demand is highly persistent is good news in that environmental policies in Portugal can be implemented in a favorable setting in which their effects will tend to be long lasting. Second, the high persistence of gas and the fact that biomass and petroleum have levels of persistence that are similar suggests that fuel switching policies will be relatively easy to implement in these cases. The case of coal is somewhat different in that switching away from coal may not be easy. In turn, the case of electricity is somewhat ambiguous. While the fact that it is also highly persistent suggests that shocks to its final demand will produce long lasting effects, it is not clear, however, how they compare to the effects on the other final demand components and therefore we can make no statements about fuel switching.

JEL-codes: C14 C22 O13 Q41 (search for similar items in EconPapers)
Pages: 19 pages
Date: 2011
New Economics Papers: this item is included in nep-ene and nep-env
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

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Related works:
Journal Article: Final Energy Demand in Portugal: How Persistent it is and Why it Matters for Environmental Policy (2014)
Working Paper: Final energy demand in Portugal: How persistent it is and why it matters for environmental policy* (2013)
Working Paper: Final energy demand in Portugal: How persistent it is and why it matters for environmental policy (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:cfe:wpcefa:2011_20

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