Publications

Wisdom of the Experts

Using Survey Responses to Address Positive and Normative Uncertainties in Climate-Economic Models

By Peter Howard and Derek Sylvan
July 8, 2020

The social cost of carbon (SCC) and the climate-economic models underlying this prominent US climate policy instrument are heavily affected by modeler opinion and therefore may not reflect the views of most climate economists. To test whether differences exist, we recalibrate key uncertain model parameters using formal expert elicitation: a multi-question online survey of individuals who have published scholarship on the economics of climate change. Read the article, published in Climatic Change.

Option Value and the Social Cost of Carbon

What Are We Waiting For?

By Peter Howard, Alexander Golub, and Oleg Lugovoy
June 22, 2020

Scientists and economists have long recognized that significant uncertainties and irreversibility characterize climate change. And yet, the social cost of carbon (SCC), the preeminent policy tool to address climate change applied by the U.S. government, does not include the option value (OV) that arises due to these characteristics. We demonstrate a simple methodology for approximating the OV underlying the SCC using the Bachelier formula

Managing the Future of the Electricity Grid: Modernizing Rate Design

By Richard Revesz and Burcin Unel
February 1, 2020

This article, published in the Harvard Environmental Law Review, argues that the electricity sector is at a critical juncture, and that a shift to a paradigm with a long-term vision that includes better, economically efficient rate designs is necessary if we want to realize the clean energy future that the modern grid promises us.

(Not So) Clean Peak Energy Standards

By Jeffrey Shrader, Christy Lewis, Gavin McCormick, Isabelle Rabideau, and Burcin Unel
December 10, 2019

Growth in electricity storage has the potential to increase emissions from power generation. Concerns about this outcome are currently prompting many policies to address the issue. We study a particularly popular policy proposal called the “Clean Peak Standard” that incentivizes storage to discharge during periods of high electricity demand. The stated goal of the policy is to shift storage discharge to offset production from generators with high pollution emissions. We show that the policy is largely ineffective at achieving this emissions reduction goal. The policy reinforces existing incentives faced by storage operators, so it does not have a strong effect on discharging behavior. It is also unable to capture high-frequency changes in marginal operating emissions rates. Alternative policies, such as a carbon tax, are more effective at reducing the emissions increase caused by storage. Policymakers considering Clean Peak-style policies should instead consider these alternative policies.

Electricity Simulations on the Distribution Edge

Developing a Granular Representation of End-User Electric Load Preferences using Smart Meter Data

By Ashwini Bharatkumar, Ricardo Esparza, Kristina Mohlin, Elisheba Spiller, Karen Tapia-Ahumada, and Burcin Unel
June 1, 2019

The electric distribution grid is transitioning toward a model in which customers can themselves provide a variety of services to the grid by investing in distributed energy resources (DERs) such as distributed solar generation, programmable appliances, and energy storage. However, customers’ incentives to make these investments depend on how they are being charged for electric service. Despite the topic’s importance for the electric distribution system of the future, the body of literature on the impact of electric rate design on the proliferation of DERs is still limited. Our research improves upon common assumptions of fixed electric demand by incorporating microeconomic theory into an existing engineering simulation model.