Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Das Wichtigste in Kürze Non-Technical SummaryFuel poverty may become an increasingly severe problem in developed countries in cases when real prices for fossil fuels increase at high rates or when real energy prices increase due to policies for greenhouse gas abatement. Fuel poverty measurement consists of two largely independent parts, firstly, the definition of an adequate fuel poverty line, and secondly, the application of techniques to measure fuel poverty given some poverty line. This paper reviews options for the definition of fuel poverty lines as well as techniques for fuel poverty measurement. Based on household data from Germany, figures that would result from different fuel poverty lines are derived. Different fuel poverty lines partly yield highly different results with respect to which households are identified as fuel poor. Thus, the choice of the fuel poverty line matters decisively for the resulting fuel poverty assessment. Options for fuel poverty measurement and subgroup comparison in order to identify most vulnerable types of households are discussed in the light of the literature and based on applications to German household data. Measuring Fuel Poverty General Considerations and Application to German Household DataPeter Heindl 1 Centre for European Economic Research (ZEW), Mannheim, Germany August 2013Abstract: Fuel poverty may become an increasingly severe problem in developed countries in cases when real prices for fossil fuels increase at high rates or when real energy prices increase due to policies for greenhouse gas abatement. Fuel poverty measurement consists of two largely independent parts, firstly, the definition of an adequate fuel poverty line, and secondly, the application of techniques to measure fuel poverty given some poverty line. This paper reviews options for the definition of fuel poverty lines as well as techniques for fuel poverty measurement. Based on household data from Germany, figures that would result from different fuel poverty lines are derived. Different fuel poverty lines partly yield highly different results with respect to which households are identified as fuel poor. Thus, the choice of the fuel poverty line matters decisively for the resulting fuel poverty assessment. Options for fuel poverty measurement and subgroup comparison in order to identify most vulnerable types of households are discussed in the light of the literature and based on applications to German household data.

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Dynamic Properties of Energy Affordability MeasuresPeter Heindl* Department of Environmental and Resource Economics Centre for European Economic Research, Mannheim (Germany) and Rudolf Schüssler** Department of Philosophy University of Bayreuth (Germany) -Abstract -Measures of affordability are applied in practice, e.g., to assess the affordability of energy services, water or housing. They can be interpreted as measures of deprivation in a specific domain of consumption. The large body of literature on affordability measure has little overlap with the existing literature on poverty measurement. A comprehensive assessment of the response of affordability measures as a result of changes in the distribution of income or expenditure is missing. This paper aims to fill this gap by providing a conceptual discussion on the 'dynamics' of energy affordability measures. Several types of measures are examined in a microsimulation framework to assess their dynamic properties. Our results indicate that some measures exhibit odd dynamic behavior. This includes measures used in practice, such as the low income/high cost measure and the double median of expenditure share indicator. Odd dynamic behavior is attributed to definitions made with respect to higher moments of the expenditure distribution. Definitions that rely on a percentage share of expenditure relative to income or an absolute or relative income poverty line fare well from a dynamic perspective.

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Non-Technical SummaryIn this paper, transaction costs of German firms, regulated under the EU emissions trading scheme (EU ETS) are examined empirically. Introduced in 2005, the EU ETS currently regulates carbon dioxide emissions of roughly 11,000 installations in the 27 EU member states, Norway, Liechtenstein and Iceland. Its aim is to reduce greenhouse gas (GHG) emissions in energy intensive industry branches and utility companies by 21 percent until 2020 compared to 2005.Transaction costs can be seen as costs for managing the EU ETS and carrying out necessary administrative tasks. As the data reveal, transaction costs depend on annual emissions and annual volumes of traded emissions allowances of firms in a nonlinear fashion, based on OLS and nonparametric estimation. This implies the presence of scale economies in the management of the EU ETS. Overall transaction costs increase for firms that have emissions levels ranging from zero to approximately one million tons of CO 2 emissions per year. Overall transaction costs decrease for firms with more than one million tons of CO 2 emissions (see figure 3). Based on the results, overall annual transaction costs for all German firms regulated under the EU ETS are estimated at 8.7 EUR million c.p. in average.In contrast to assumptions made by standard economic theory, marginal transaction costs also depend on annual emissions levels and annual trading volumes respectively. This implies that firms also take the costs of managing the EU ETS and costs for general administrative obligations into account when minimizing costs under the EU ETS. As a consequence, the firm's incentives for greenhouse gas abatement are different than in a 'first-best' case with zero transaction costs. In practice, firms with less than one million tons of annual emissions (which do not profit from economies of scale in the management) will emit less (abate more) than emitters with more than one million tons of annual emissions. Although the changes are small and will not affect environmental effectiveness of the EU ETS, economic efficiency is decreased by transaction costs, resulting in a welfare loss.The average transaction costs (transaction costs divided by annual emissions) are highly different for firms of different sizes. Average transaction costs are relatively high for smaller emitters (up to EUR 1.00 per ton CO 2 ), but trickle down with rising annual emissions of a firm. At low emissions levels, such as 5,000 or 10,000 tCO 2 p.a., d...

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Price and Income Elasticities of Residential Energy Demand in GermanyIsabella Schulte * , Peter Heindl † July 2016 AbstractWe apply a quadratic expenditure system to estimate price and expenditure elasticities of residential energy demand (electricity and heating) in Germany. Using official expenditure data from 1993 to 2008, we estimate an expenditure elasticity for electricity of 0.3988 and of 0.4055 for space heating. The own price elasticity for electricity is -0.4310 and -0.5008 in the case of space heating. Disaggregation of households by expenditure and demographic composition reveals that the behavioural response to energy price changes is weaker (stronger) for low-income (top-income) households. There are considerable economies of scale in residential energy use but scale effects are not well approximated by the new OEDC equivalence scale. Real increases in energy prices show a regressive pattern of incidence, implying that the welfare consequences of direct energy taxation are larger for low income households. The application of zero-elasticities in assessments of welfare consequences of energy taxation strongly underestimates potential welfare effects. The increase in inequality is 22% smaller when compared to the application of rich and disaggregated behavioural response patterns as estimated in this paper.

Die Dis cus si on Pape rs die nen einer mög lichst schnel len Ver brei tung von neue ren For schungs arbei ten des ZEW. Die Bei trä ge lie gen in allei ni ger Ver ant wor tung der Auto ren und stel len nicht not wen di ger wei se die Mei nung des ZEW dar.Dis cus si on Papers are inten ded to make results of ZEW research prompt ly avai la ble to other eco no mists in order to encou ra ge dis cus si on and sug gesti ons for revi si ons. The aut hors are sole ly respon si ble for the con tents which do not neces sa ri ly repre sent the opi ni on of the ZEW. Ecological Sufficiency, Individual Liberties, and Distributive Justice: Implications for Policy Making Peter Heindl and Philipp KanschikMarch 2016We investigate the prospects of voluntary ecological sufficiency for environmental and climate policy under the constraints implied by political liberalism. We find that freedom of choice restricts sufficiency to rather wealthy societies and that a sufficiency threshold cannot be derived by referring to the poor. Sufficiency can be in conflict with the demands of social justice, i.e. if the sufficiency threshold is below the social minimum implied by social justice. Benefits from sufficiency are highly related to individual perceptions. Such benefits cannot be expressed in a standard preference framework. Consequently, alternative measures of welfare and inequality are required if sufficiency is a significant phenomenon in society. 'Standard' environmental policies can have a pronounced interaction with voluntary sufficiency, i.e. if 'quantity regulation' is present. Overall, the voluntary notion of sufficiency causes a dilemma as sufficiency is largely a matter of civil society. However, voluntary sufficiency is expected to make important contributions to the preservation of ecological resources if properly balanced with social and environmental policies and framed by public discursive control.