Handbook of Environmental and Resource Economics
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Handbook of Environmental and Resource Economics

  • Elgar original reference

Edited by Jeroen C.J.M. van den Bergh

This major reference book comprises specially commissioned surveys in environmental and resource economics written by an international team of experts. Authoritative yet accessible, each entry provides a state-of-the-art summary of key areas that will be invaluable to researchers, practitioners and advanced students.
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Chapter 73: Energy–Economy–Environment Models

S. Faucheux and F. Levarlet

Extract

73 Energy-economy-environment models ~ ~~ ~ v and~~ ~e ~ r ~ ~ v a ~ ~ e te ~ c ~ ~ ~ ~ ~ 1. Introduction The fears about depletion of fossil fuel resources, such as oil, at the beginning of the 1970s gave a strong impetus to the development of energy+conomy modelling aimed at highlighting decision-making options. Over subsequent years the complexity of modelling has increased, notably with the coverage of global environment issues such as acid rain, ozone depletion and climate change. The accumulation of greenhouse gases in the atmosphere, especially CO,, whose emissions are largely caused by energy-related a c t ~ v ~ t icould have ~ r e m e n d o u ~ ~s, imp~ications both for long-run ecological and economic security. The threat of climate change is taking on an increasingly important role in designing economic development strategies and energy policies. In this context, since the 1980s it has become usual to talk about energy~conomy~nvironment models rather than energy-economy models, because analysts now seek to address the complex interactions between the process of energy production and consumption, the economy and the environment. A typical representation of an energy~conomy system is given in Figure 73.1. The economy is presented as an open system with a special focus on energy dimensions. The main features are: primary energy inflows into the energy-refining sector and the economy, meaning the inputs of energy resources from the natural environment; e waste outflows including dissipated energy; transformations within the energy-economy system: technical improvements, thermodynamic changes, behaviour changes, and so on; 0...

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