Programme

The service transition is usually presented in the literature as one of the factors that contributes to the decline of energy intensities of developed economies. We show that this is based on false beliefs about what the service economy is about. The shift to a service economy is somewhat of an illusion in terms of real production, and generated by the more rapid productivity growth in manufacturing than in services. Several of the recent studies that have investigated the impact of structural changes on energy intensity have still used sector shares in current prices, which ignore the different behavior of prices across sectors and we use the more reasonable method of sector shares in constant prices. We investigate the impact of structural and technological effects on the final energy intensity of 10 developed and 4 developing countries in a 4 sector context (Agriculture, Industry, Services, Transportation) and 2 end users (households and personal transportation) employing the logarithmic mean Divisia index (LMDI). We find that structural changes had a positive impact on energy intensity both in developed and developing countries, over the last 50 years, because there is not much of a broad service transition in constant prices. Rather it is the energy- demanding transport (part of the service sector) that increase its share. The explanation for the decline in energy intensity in developed countries lies within the sectors, especially within the manufacturing sector. For fast growing developing countries it is the residential sector that drives energy intensity down, because of the declining share of this sector as the formal economy grows and as a consequence of fuel switching to more efficient fuels.

This paper investigates the energy transition and the relation of energy and economic growth on the basis of a comparable long term historical dataset for four national case studies. It analyses data on the development of energy use and the consumption of energy services during 100 years of industrialization in Austria, Japan, the United Kingdom and the USA. All four countries appear as fully industrialized countries today, but were at different stages of industrialization and the energy transition at the beginning of the 20th century: In contrast to the advanced economies of the UK and the USA, Austria and Japan were late comers to industrialization but were rapidly catching up.

The paper uses the exergy approach to assess changes in the energy system. Exergy is a quality measure of energy which quantifies the ability of energy to perform work. Not all thermodynamic work is useful, but useful work is the prerequisite for all energy services demanded by final consumers. The paper provides a comparative analysis of time series data covering the period 1900 to 2000 which include exergy inputs, useful work output, exergy-to-(useful) work conversion efficiency, carbon intensity and the exergy intensity of the economy. Based on this dataset it explores patterns of energy transition and the relation of useful work and economic growth during industrialization.

From the comparative analysis we conclude that industrialization is characterized by a typical pattern of energy transition. Economic structure and per capita level of exergy inputs and useful work outputs as well as the exergy intensity of the economy develop in a very similar way in all four countries and lead to a common pattern in fully industrialized countries. Differences, however, can be observed between the countries with high and low population density. Our results further support the hypothesis, that economic growth and exergy (and in particular useful work) consumption are strongly linked and that economic growth requires an increase in available useful work. This raises a two fold concern: A reduction of the high level of exergy demand in industrial countries can only be accomplished by increasing the conversion efficiency of exergy inputs into useful work. Ultimately, however, the potential to decouple economic growth and energy (exergy) demand seems to be strictly limited. For currently industrializing countries it is important to find alternative paths to development.

In 1950, nearly 50years after the introduction of the motor tractor and more than a century after the adoption of steam power, an estimated 85% 0f all draught power on European farms was supplied by animals. In W Europe motorisation occurred in the period 1950-80, where in parts of S and E Europe animals were still predominant in 1980. This paper examines the power economy in the two halves of the century. It explains the late survival of animal power. It looks at the changing composition and geography of the working herd as between different types of cattle (oxen, cows, buffalo), and equides.(horses, mules, donkeys, asses). Likewise the mechanical power-steam, electricity, oil/gasoline. The second section centres on power output and utilisation, inefficiencies, and high level of wastage Key issues include:the low rates of substitution of tractors for horses, the '0x-Horse Controversy', and why actual work rates were in the main so much lower than nominal horse-power ratings.

The current focus on a possible transition to a low-carbon economy has created an interest in past experiences. Energy transitions in UK´s rich history offers many lessons. Rather than looking-at the aggregate picture, this paper highlights the importance of investigating individual sectors and services. For each sector and service, energy transitions occurred at different times and at varying rates. In some cases, the search for solutions to technical or institutional issues delayed the energy transition by decades or even centuries. Based on these experiences, a rapid full transition to a low-carbon economy cannot be expected.

The paper discusses the use of energy by Dutch households, in particular space heating. To what extent did generations live a cold life in the past and to what extent was the 'gas revolution' a fundamental change?

The processes of energy transitions, in particular the fossil energy transition,have been studied or at least described in most industrialised countries, but not in relatively less developed countries. This paper analyses the phenomenon of the energy transition in fossil energies (the shift from coal to petroleum) in Latin America and contrast it with the classic model of energy transition. This is was not possible before now since the data was not available for these countries prior to 1950 when the transition was already complete. Here we make use of a new reconstruction of data on energy consumption for Latin America and the Caribbean from 1890 to 1950.
We show that the energy transition model of the Western World cannot be considered as the paradigm of fossil energy transition. From the Latin American experience it appears clear that the succession of energy sources is not governed by a universal law of progress or of technical change. Instead, it is the result of a set of historical determinants among which the most remarkable include the structural conditions in each country (geographical location, resource endowment, economic structure, technological dependence, institutional framework, etc.) and the junctures and long term evolution of the international energy and fuel markets. According to the combination of all these factors, each country trace its particular path of energy transition.

Economic theory says that price-taking producers maximize their profits by choosing output, so that its unit price equals it marginal cost. However, in an environment where the output decision must take place prior to the sales date at which the price becomes known, and when historical prices are subject to volatility, theory says that producers, when risk-averse, respond by reducing output to a level below that of the price certainty case. Indeed, theory predicts that the higher is price volatility, the more output falls below the price certainty level. The current study makes use of this hypothesis in an attempt to quantify the impact of climatic variation on industrial output for England in the run up to the industrial revolution. Specifically, the aim is to analyze whether climatic volatility, as reflected in price volatility, tends to slow down the process of industrialization. We conduct two regression analyses. Firstly, we try to explain real industrial output using a measurement of dispersion of real industrial prices. These prices are constructed by deflating an index of nominal industrial prices by a consumer price index. As a side story, we also estimate for how many years prior to the output decision producers take price volatility into account. Secondly, since the consumer price index we use is dominated by food prices, and because food prices variation, in turn, is linked to climatic variability, we then attempt to measure the impact of climate volatility on price volatility, and then on to industrial output. All findings will be presented at the Utrecht session.