R&D project selection for promoting the efficiency of energy use

Screening criteria for selecting energy R& D projects are discussed and applied to a dozen projects currently underway. The impact on energy balance and environmental quality cannot be seen as the only, nor even the dominating, attribute. In the cases studied, the R&D portfolio seeks to achieve a balance between these factors and the other criteria related to technology and the market. In the event the development work is carried out at an independent R&D centre, it will be necessary to have a committed industrial partner from an early stage onwards in order to ensure objectivity, market perception and provide the best chance of commercialisation.     

A Smooth Transition Logit Model of The Effects of Deregulation in the Electricity Market

This paper introduces the smooth transition logit (STL) model that is designed to detect and model situations in which there is structural change in the behaviour underlying the latent index from which the binary dependent variable is constructed. The maximum likelihood estimators of the parameters of the model are derived along with their asymptotic properties, together with a Lagrange multiplier test of the null hypothesis of linearity in the underlying latent index. The development of the STL model is motivated by the desire to assess the impact of deregulation in the Queensland electricity market and ascertain whether increased competition has resulted in significant changes in the behaviour of the spot price of electricity, specifically with respect to the occurrence of periodic abnormally high prices. The model allows the timing of any change to be endogenously determined and also market participants' behaviour to change gradually over time. The main results provide clear evidence in support of a structural change in the nature of price events, and the endogenously determined timing of the change is consistent with the process of deregulation in Queensland. Copyright © 2015 John Wiley & Sons, Ltd.