Advances in Energy Economics Research
Paper Session
Saturday, Jan. 7, 2023 12:30 PM - 2:15 PM (CST)
- Chair: Alberto J. Lamadrid, Lehigh University
Fracking Boom and Agricultural Doom? Evidence from Kern County, California
Abstract
In this study, we investigate the effect of hydraulic fracturing on agricultural pro- ductivity in Kern County, California, which is the state’s leading agricultural as well as unconventional oil/gas mining county. The Central Valley farmers, particularly in Kern County, have reportedly noticed sudden crop deaths and decline in their agricultural production since around 2009 that the local farmers have vehemently attributed to the pollution of irrigation water as a result of the nearby fracking activities. To understand whether the (under-regulated) discharge of wastewater from fracking activities generates any measurable negative externalities on agricul- tural production, we conduct an event study analysis using difference-in-differences with two-way fixed effects and a rich set of controls to quantify the impact of hy- draulic fracturing activities on the yield of major crops grown in Kern County. We find negative, statistically significant effects for multiple crops, which confirms the farmers’ claim that the fracking boom in the region has hurt crop yield and pro- duction. We also find that certain crops show no effect, which may be suggestive of crop resilience to fracking-related externalities.Does Access to Liquefied Petroleum Gas (LPG) Reduce Women Household Burden? Evidence from India
Abstract
Using the nationally representative Indian Time Use Survey, we study whether the use of Liquefied Petroleum Gas (LPG) as cooking fuel affects the time spent in cooking and employment activities for Indian rural women. We instrument use of LPG by a leave-one- out spatial instrument constructed by taking the average level of LPG use in the village where the average is calculated leaving the concerned household. We find no impact of LPG on the probability of women participating in cooking activities. However, use of LPG reduces (increases) time spent in cooking (employment) activities. We also find evidence of rebound effect where use of LPG leads to marginally more cooking events in a day. We find that LPG impact on time spent in cooking and employment is mostly driven by married women.Industry Compliance Costs Under the Renewable Fuel Standard: Evidence from Compliance Credits
Abstract
The Renewable Fuel Standard (RFS) is the most impactful alternative fuel policy in the United States and the subject of ongoing debate. The RFS, which requires oil refineries to blend biofuels into domestic fuel supplies under a mandate that is reviewed and changed by the Environmental Protection Agency yearly, is a market-based policy that implements tradable compliance credits (called RINs) to better equalize compliance costs across firms. Proposed volumetric mandates frequently precipitate court cases and always trigger renewed public attention regarding the policy’s effect on the broader energy industries. We exploit unanticipated mid-compliance-year regulatory announcements that changed mandated biofuel blending volumes to identify how the RFS impacts stock prices of refining firms. Previous literature on cost pass-through suggests that the RFS should have little impact on refining firms. In contrast, we find a significant negative oil refinery stock price response to shocks in RFS compliance credit values. This negative effect is limited to refining firms with large market capitalizations and integrated downstream operations. These findings are relevant to policy in that they cast doubt on concerns that the RFS allows large, integrated refiners to abuse smaller, merchant refiners. Our findings also shed light on the necessity of Small Refinery Exemptions, which are intended to shield small, financially vulnerable refiners from RFS compliance costs.Discussant(s)
Amanda Harker Steele
,
National Energy Technology Laboratory
Sheila Olmstead
,
University of Texas-Austin
Rossella Calvi
,
Rice University
Cody S. Nehiba
,
Louisiana State University
JEL Classifications
- Q4 - Energy
- L9 - Industry Studies: Transportation and Utilities