This is a 6 ECTS lecture/seminar course designed to provide students with an introduction to the principles of energy economics and related policy applications. There are increasing concerns globally on the management of energy resources and their development, such as energy security, environmental impacts of energy use, regulation, investment in renewable energy, risk assessment or safety issues of nuclear power etc. Understanding the characteristics of the different energy markets in terms of demand, supply, investments, energy-economy-environment interactions, and related policy aspects is critical to effective policy intervention.

This course covers the economic tools for analyzing institutions and driving forces of energy markets, including coal, natural gas, crude oil, gasoline/diesel, electricity, and renewables, with a focus on understanding supply and demand changes, prices, production, and investment as well as the motives and consequences of policy interventions.

Students will be introduced to the environmental implications of energy use and the role of economic analysis in designing policies that address issues of energy security, climate change, and the distributive consequences of climate policies. Regarding the distributional impacts of climate policies, we will address theoretical concepts, including incidence or inequality and their measurement, and analyze the distributive effects of current climate policies. Throughout the course, theoretical discussions will be complemented with empirical evidence and research that explores different aspects of the energy markets to help students better understand the respective energy markets.

Ancillary objectives of the course include supporting students to develop research topics and introducing them to academic writing. To this end, students will develop some expertise in working with real-world energy data and policies and writing a research paper.

The course starts with a series of lectures on selected topics. The lecture sessions aim to facilitate the development of students’ understanding of the economic theory related to the various energy markets. Students will be guided to develop their research projects during the first half of the semester.

The projects could be related to the distributive consequences of climate policies, inequality in adaptation to climate change, climate justice, market power and collusion in the retail fuel market, barriers to the adoption of renewable energy technologies, and challenges of renewables in the electricity market. Other topics include the impact of climate change on transportation systems, effects of overlapping energy and climate regulations, Russia-Ukraine war and energy poverty, Subjective Well-being and energy prices, Edgeworth cycles in the retail gasoline market, limits on domestic flights as emissions reduction strategy, the incidence and emissions impact of fuel tax in Germany, vertical vs. horizontal distributive effects of climate policies, incidence of climate policies – developed vs. developing countries etc. Note that students can choose topics listed or develop their own topics of
interest.

At the start of the second part of the course, students will present their tentative research projects and receive input from instructors. They will then use the remaining period to work on their research projects with the support of instructors. Towards the end of the semester, there will be a 2-day block seminar where students will present their work in a scientific conference format.