Price systems and bioenergies
Biofuels are a masterpiece of the bioeconomy. Its development must combine environmental care and private profitability. The current pricing system as an inducer of private decisions and allocator of social resources becomes critical on: i) establish and promote new sources of renewable energy (long...
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| Autores principales: | , |
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| Formato: | Artículo publishedVersion |
| Lenguaje: | Español |
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Instituto Interdisciplinario de Economía Política (IIEP UBA-CONICET)
2022
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| Acceso en línea: | https://ojs.economicas.uba.ar/DT-IIEP/article/view/2531 https://repositoriouba.sisbi.uba.ar/gsdl/cgi-bin/library.cgi?a=d&c=dociiep&d=2531_oai |
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| Sumario: | Biofuels are a masterpiece of the bioeconomy. Its development must combine environmental care and private profitability. The current pricing system as an inducer of private decisions and allocator of social resources becomes critical on: i) establish and promote new sources of renewable energy (long term); and ii) guarantee offer and profitability (short term). The energy-intensive paradigm, based on fossil fuels, responds to short-term private price signals but generates long-term distortions (it does not include negative externalities or sustainability demands). A shift towards a sustainable energy matrix demands a two-way response: creating the fundamental rules for a new market (“bio-energies”) and establishing a long-term price set that includes environmental restrictions (adjusting private profitability criteria to social objectives).
Given the difficulties of the market in making both objectives compatible, state interventions appear. The different pricing schemes have been a fundamental piece in the design of the regulatory frameworks that generated different bio-fuel markets. Four main mechanisms are distinguished: prices set by the Application Authority, pure bids, conditional tenders, and free competition schemes. These schemes have been complemented, in some cases, by schemes that attempt to correct market imperfections (negative externalities) such as the effect of fossil fuels on climate change. The work begins with a theoretical review of the difficulties of the pricing mechanism to allocate the non-renewable resources. Subsequently, it analyses cases of state interventions in biofuel markets. |
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