Energy use in industry - Phase 2

The overall purpose of this study is: 1) to increase the understanding of which factors are influencing industrial energy consumption, this includes a description of how individual company characteristics influence the energy consumption, e.g. company size and energy intensity. 2) to analyse the impact of existing policy instruments targeted at industrial energy consumption (taxes, agreements, energy audits and subsidies) and to create a tool for analysis of policy scenarios, e.g. others tax levels or a more restricted use of agreements. The analysis will be based on a micro-level panel database covering most of the tatal energy use in Danish industrial companies. I.e. a database with observations on energy use and activity for each compagny that is organised so each company can be followed over several periods. This proposal covers phase II. This phase will concentrate on: 1) adding new information to the database (mainly economic data for 1996) and the models developed under phase I will be reestimated with the complete data. Information about subsidies for investment in energy efficiency will be included in these models. 2) developing the models to give a more flexible presentation of energy consumption, capital and labour. The goal is to estimate all relevant cross elesticities between these components. The database containts sufficient information to calibrate such advanced models. 3) analysing policy scenarios. The advantage of models from this project is their ability to take individual company characteristics into account, e.g. aspects like the Danish CO2 tax with five different tax levels - the resulting tax is specific to the company and the individual production