OVPR Events

Energy Systems/Policy Brown Bag Lunch Seminar Series

March 8 @ 11:30 AM - 1:00 PM - Potter Building, Fu Room, # 234

The Energy Center will be hosting a bi-weekly seminar series on energy systems/policy. This brown bag lunch seminar series is for the Spring of 2012 occurring the 2nd and 4th Thursday of each month in the Potter Building, Fu Room # 234 from 11:30-1:00 pm.

Join us for this week’s lecture by Wally Tyner, AGECON.  His lecture is titled ‘Comparison of Government Energy Mandates with a Carbon Tax’.

Please come, listen and join in the discussion at this brown bag lunch series. You are welcome to bring along anyone who may enjoy these fascinating topics.

We hope to see you Thursday!

 

Abstract

To deal with Greenhouse Gas (GHG) emissions and other energy externalities, most economists would recommend a carbon tax or a cap and trade policy. However, politicians appear to have rejected these approaches, at least for now. In his 2011 State of the Union message, President Obama proposed instead a Clean Energy Standard.  Under this approach, 80 percent of our electrical energy would need to come from "clean" energy sources by 2035. Included in clean energy electricity are coal with carbon capture and sequestration, nuclear, various renewable energy resources, and natural gas (50% clean). Today under this definition, we are approximately 40 percent "clean" in electricity generation.  That percentage would grow incrementally to reach the 80 percent mandate by 2035. Effectively, this policy uses a mandate instead of a pricing mechanism to achieve energy policy objectives.

The purpose of this paper is to compare the clean energy standard in conjunction with Renewable Fuel Standard (RFS) and Corporate Average Fuel Economy (CAFE) standard with a carbon tax using several metrics. We make use of the US EPA MARKAL model to simulate those policy alternatives. The model database version is calibrated according to Annual Energy Outlook 2010 and is further enhanced with data generated from a global general equilibrium model, GTAP. Agricultural land data from GTAP using the 2004 database was added to MARKAL by agro-ecological zone (AEZ).  GTAP was then simulated in increments of one billion gallons of corn ethanol up to 20 billion gallons. The land rent values obtained from these simulations were used to produce land supply curves for MARKAL thereby permitting MARKAL to reliably simulate biomass supply in the context of other energy technologies and economic activities.

We estimate the impacts from the combined set of mandates and a carbon tax for reducing greenhouse gas emissions, effect on electricity costs, and impacts on the mix of technologies that are employed under the two policy approaches.

Bio

Professor Tyner is an energy economist and James and Lois Ackerman Professor of Agricultural Economics, Purdue University.  He received his B.S. degree in chemistry (1966) from Texas Christian University, and his M.A. (1972) and Ph.D. (1977) degrees in economics from the University of Maryland. Professor Tyner’s research interests are in the area of energy, agriculture, and natural resource policy analysis and structural and sectoral adjustment in developing economies.  He has over 250 professional papers in these areas including three books and 90+ journal papers, published abstracts, and book chapters.  His past work in energy economics has encompassed oil, natural gas, coal, oil shale, biomass, ethanol from agricultural sources, and solar energy.  His current research focuses on renewable energy policy issues and climate change.  He teaches a graduate course in benefit-cost analysis, which incorporates risk into the economic and financial analysis of investment projects.  In 5 of the past 7 years, his students have received the department’s outstanding thesis award.  In June 2007, Senator Richard G. Lugar of Indiana named Tyner an “Energy Patriot” for his work on energy policy analysis.  In 2009 he received the Purdue College of Agriculture Outstanding Graduate Educator award and was part of a group that received the College Team award for multidisciplinary research on biofuels.  In 2011, he served as Co-chair of the National Academy of Sciences Committee on Economic and Environmental Impacts of Biofuels.

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