On the transition from nonrenewable energy to renewable energy

Yacoub Bahini and Cuong Le van

No 2015-629, Working Papers from Department of Research, Ipag Business School

Abstract: In this paper we use the CMM model (Chakravorty et al.,2006) in discrete time and obtain more results concerning the exhaustion time of Non-Renewable Resource (NRE), the dynamic regimes of energy prices, of the stocks of pollution. We show that NRE is exhausted in finite time and is directly influenced by the initial stock of NRE and the costs of NRE and RE. Higher is the initial stock of NRE, far is the time of exhaustion of NRE. Higher is the cost of NRE (resp. the difference of unit costs between RE and NRE), far is the time of exhaustion of NRE. Furthermore, we show that the abatement intervenes, when necessary, not more than two periods. We also show that, when the unit extraction cost of RE is not very high, the stocks of emissions will never be binding if and only if, the initial stock of NRE is less than a critical value.

Keywords: Dynamic optimization; Natural resources; Energetic transition; Environment. (search for similar items in EconPapers)
JEL-codes: P28 Q01 Q32 Q42 Q48 Q52 (search for similar items in EconPapers)
Pages: 34 pages
Date: 2015-01-01
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
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Related works:
Working Paper: On the transition from nonrenewable energy to renewable energy (2015)
Working Paper: On the transition from nonrenewable energy to renewable energy (2015)
Working Paper: On the transition from nonrenewable energy to renewable energy (2015)
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