Rebound and disinvestment effects in oil consumption and supply resulting from an increase in energy efficiency in the Scottish commercial transport sector

Sam Anson
Additional contact information
Sam Anson: Scottish Government Transport Directorate
Authors registered in the RePEc Author Service: Karen Turner

No 901, Working Papers from University of Strathclyde Business School, Department of Economics

Abstract: In this paper we use an energy-economy-environment computable general equilibrium (CGE) model of the Scottish economy to examine the impacts of an exogenous increase in energy augmenting technological progress in the domestic commercial Transport sector on the supply and use of energy. We focus our analysis on oil, as the main type of energy input used in commercial transport activity. We find that a 5% increase in energy efficiency in the commercial Transport sector leads to rebound effects in the use of oil-based energy commodities in all time periods, in the target sector and at the economy-wide level. However, our results also suggest that such an efficiency improvement may cause a contraction in capacity in the Scottish oil supply sector. This ‘disinvestment effect’ acts as a constraint on the size of rebound effects. However, the magnitude of rebound effects and presence of the disinvestment effect in the simulations conducted here are sensitive to the specification of key elasticities of substitution in the nested production function for the target sector, particularly the substitutability of energy for non-energy intermediate inputs to production.

Keywords: general equilibrium; energy efficiency; rebound effects; disinvestment (search for similar items in EconPapers)
JEL-codes: D57 D58 Q41 Q43 R15 (search for similar items in EconPapers)
Pages: 33 pages
Date: 2009-01
New Economics Papers: this item is included in nep-cmp and nep-ene
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Citations: View citations in EconPapers (33)

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Working Paper: Rebound and disinvestment effects in oil consumption and supply resulting from an increase in energy efficiency in the Scottish commercial transport sector (2009)
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