ENERGY ECONOMICS REVIEW
Year:2008 | Volume:5 | Issue:16|Papers Count:8

The current paper utilizes a CGE model to evaluate the impact of an increase in the price of energy sources on the Iranian economy. The study uses the base data of the Social Accounting Matrix (SAM) for 1380 (2001) and calibrating the model based on three scenarios: 1) an increase in petrol prices; 2) an increase in all energy prices and 3) an increase of all energy prices to international levels.In all cases the results demonstrate a reduction in energy use at the household and firm levels, due to lesser divergence of relative prices from optimal levels. On the other hand, the increased in production costs leads to increased inflation and reduced economic welfare of low income population groups. Naturally the increase in inflation and reduction in economic welfare is significantly more pronounced in the case of an increase in all energy prices compared to an increase of petrol prices alone.

This research evaluates the reforms undertaken in the Iranian power industry using a strategic planning approach. An aggregated model for reform in power industry is developed based on benchmarked experiences. Later, the Iranian industry’s current situation is investigated. Lastly, a gap analysis measures the effectiveness of Iranian government reform policies, by comparing existing with desirable conditions.The results suggest that after the original restructuring and vertical separation in the Ministry of Power and the foundation of Tavanir holding, optimal sequencing of reform priorities and stages has been adopted. Comparing the reform process to developed models of electricity sector reform demonstrates the greatest convergence with respect to legal reforms as compared to ownership reforms. The correct implementation of general policies of Article 44 (on privatization) has greatly impacted this development.The greatest gap is observed in structural reform. As a result, the absence of new institutions and horizontal separation of roles are two major risks facing the emergence of competitive electricity markets and can endanger effectiveness of electricity sector reforms in Iran.

Energy policy making in support of sustainable development requires consideration of a range of technical, economic and environmental issues, in a context of limited energy resources and technologies. Use of appropriate modeling techniques in energy policy making is important, given the complexity of factors that affect the decision making process. Unfortunately, traditional energy modeling techniques cannot produce optimal results when it comes to meeting multiple objectives. This study is informed by the progress obtained in development of advanced multiple objective algorithms in the engineering field. Here, we attempt to study optimization of energy systems based on multiple, conflicting and non-linear objectives. In this article, we use a genetic algorithm for organizing meritocratic, non-dominated answers to model and analyze resource allocation choices. The study demonstrates that use of evidence based decision making systems, based on multiple objective optimization, allows analysis of establishing a balance amongst multiple, conflicting and non-linear objectives. Such a system improves the ability of energy policy makers in predicting and ameliorating the results of alternative policy choices, thus assisting them to adopt more appropriate policies. The results also indicate a need for continued research in the use of other modern optimization techniques for the analysis of energy systems.

OPEC, as a major actor in the field of energy, has a significant role in managing the energy market. It has so far acted as a stabilizing force to moderate energy shocks. One of the tools used by this organization in order to counteract declining oil prices has been the mechanism of "Assigning Quotas".In this paper, evolution of this mechanism and the OPEC member countries’ perspectives in this regard are examined. This is followed by estimating OPEC production during 1982-2005 through econometric modeling. The paper goes on to forecast production and quotas up to 2017. The modeling exercise demonstrates that two variables, namely, amount of reserves and the country's earlier quota have had the greatest impact on projected quotas for most OPEC countries. Based on this forecasting model, production quota of Iraq and Saudi Arabia are expected to increase, while other countries generally will be facing decreased production quotas.

This paper aims to examine the effect of oil revenue on the economic growth of oil exporting countries in the period 1990-2004 using unbalanced panel data. Results show that oil revenue in itself is not harmful to economic growth. In other words, the direct impact of oil revenue on economic growth is positive. However, when other explanatory variables like corruption, physical investment, terms of trade and training are fed into the model, due to impact of oil revenue on these variables and their indirect impact on economic growth, the overall effect of oil revenue on growth becomes negative. Moreover, results show that such factors as the increase of physical investment, the improvement of terms of trade and expansion of training have a positive impact on economic growth of oil exporting countries, while other factors like the increase of oil revenue and corruption have a negative impact. It is worth mentioning that conditional convergence is also observed in the above mentioned countries.

Rapid increases in population and economic growth in coming decades mainly driven by emerging and developing countries will increase global energy demand in an unbalanced manner. This growth in energy demand occurs under conditions of continued dominance of oil in the world energy mix at least in the next few decades and intensified environmental and security concerns caused by increasing use of non-renewable and fossil fuels In this situation the World encounters a complicated dilemma: how to balance between the desire of developing countries for economic growth and the negative externalities of the associated growth in energy demand Many energy experts believe that improving the efficiency of energy use or reducing energy intensity of production are suitable medium term solutions for the dilemma.Considering the above point and the importance of efficient use of energy resources in OPEC member countries, this paper attempts to evaluate the energy intensity reduction potentials and the impact of utilizing these opportunities in OPEC countries by 2020. A scenario building method is utilized to calculate potential energy intensity reduction in OPEC countries and the impact of accessing these opportunities on oil export capacity, oil revenue, global oil balance and the reduction of CO2 emissions. Our results show that there exists considerable potential for reducing energy intensity and oil consumption in OPEC countries. Such achievements will have a significant effect on the global oil balance and CO2 emission reduction.

This paper reviews optimal location of FACTS devices using Genetic Algorithm (GA) with the objective of minimizing financial losses due to voltage drop.Location, type and rating of FACTS devices are taken as decision parameters. Two types of FACTS devices namely static VAR compensator (SVC) and static synchronous compensator (STATCOM) are studied. The performance of the proposed Algorithm on 295-bus Generic Distribution System (GDS) is investigated.Comparison of results of economic and financial analysis before and after installation of FACTS devices show that the total cost of the system will decrease significantly if FACTS devices are used. Economic cost benefit analysis shows that a 1% increase in the cost of FACTS devices leads to a 3.58% increase in economic benefits. The calculated Internal Rate of Return (IRR) of the project is 39.21 percent, which justifies the economic viability of this project.