Credits: 6

Schedule: 01.06.2020 - 14.08.2020

Teacher in charge (valid 01.08.2018-31.07.2020): 

Matti Liski

Contact information for the course (applies in this implementation): 

The responsible teacher for the summer course is Iivo Vehviläinen.

Best way to contact me is via email, iivo.vehvilainen@aalto.fi 


Teaching Period (valid 01.08.2018-31.07.2020): 

V Spring (2018-2019), Otaniemi campus

V Spring (2019-2020), Otaniemi campus

Learning Outcomes (valid 01.08.2018-31.07.2020): 

The objective is to develop understanding of the basic problems in environmental, resource and energy economics. Tools developed for analyzing market failures and instruments for solving them. Familiarize the student with the main challenges in the energy sector, including those related to the environment.

Content (valid 01.08.2018-31.07.2020): 

Common pool resource use in theory and practice; description and analysis of resource and energy commodity markets; pollution control in theory and practice, with particular emphasis on climate change, energy and environmental policy. Main empirical cases include: investments in nuclear power; emissions trading; pricing and investments in the electricity sector.

Details on the course content (applies in this implementation): 


Assessment Methods and Criteria (valid 01.08.2018-31.07.2020): 

• Exercises: 3 home exercises passed
• Group work: 3 topics passed
Case study: scoring 0-5, 40 % of the grading
• Exam: scoring 0-5, 60 % of the grading

Exam will be replaced by exercises.

Case study: scoring 0‐5, 40 % of the grading
Exercises: scoring 0‐5, 60 % of the grading

Spring 2020 re-take exam replaced by independent project.

 

Elaboration of the evaluation criteria and methods, and acquainting students with the evaluation (applies in this implementation): 

Due to the special arrangements in 2020, the above assessment methods and criteria are adjusted as follows:

  • 5 returned (and passed) reading assignments mandatory. Passing an assignment requires having at least half of the answers correct. 
  • 5 returned (and passed) Electricity Market Game rounds mandatory. Passing a round requires having at least half of the answers correct. 
  • 3 returned (and passed) Exercise Sets mandatory. Passing a round requires having at least half of the answers correct. 

Case study returned, 50 % of the grade 

Exam, 50 % of the grade 

Total grade determined as usual, so possible that the grade from the case study and exercise sets is going to be from 0 to 5. 

Workload (valid 01.08.2018-31.07.2020): 

The course has 4 learning elements: lectures, exercises, reading assignments, and case study.

Lectures (24 h)
• Conceptual background
• Main empirical cases

Reading assignments (30 h)
• Readings and own source search
• 3-5 questions to be analyzed
• Presenting and debating the outcome in the class

Problem sets (24 h)
• Learning methods for analysis
• Introduced and discussed in groups during the class
• 3 x 1 compulsory home exercises, returned next week

Case study (66 h)
• Analyze a case in the energy and environment field
• Write a 5-10-page report

 

Spring 2020 re-take exam replaced by independent project.

Details on calculating the workload (applies in this implementation): 

Study Material (valid 01.08.2018-31.07.2020): 

Lecture notes.

Other readings assigned during the course.

Details on the course materials (applies in this implementation): 

Lectures will be offered in the form of shorter videos on the key topics through Panopto, see link from MyCourses

You are free to watch the videos at your preferred times. 

Lecture slides are available in MyCourses. For some of the lectures, there are also lecture notes that contain more in-depth material.

Reading assignments are an integral part of the course material.

 



Course Homepage (valid 01.08.2018-31.07.2020): 

https://mycourses.aalto.fi/course/search.php?search=31C01300

Prerequisites (valid 01.08.2018-31.07.2020): 

For students of the School of Business: Principles of Economics (31A00110 or 31A00210) course or equivalent studies.

Grading Scale (valid 01.08.2018-31.07.2020): 

0 - 5

Registration for Courses (valid 01.08.2018-31.07.2020): 

Course and re-exams via WebOodi.

Further Information (valid 01.08.2018-31.07.2020): 

Students of the Advanced Energy Solutions master’s programme and Innovative Sustainable Energy Engineering master’s programme will complete the course 31E01310 Energy and Environmental Economics (5 cr). All students of the School of Business who wish to take this course will complete 31C01300 Energy and Environmental Economics (6 cr).

Details on the schedule (applies in this implementation): 

––– Week 1 ––––––––––––––––––––––––––––––––––––––––––– 

Lecture 1     PERFECT COMPETITION 

  • Perfect market benchmark 

Lecture 2     ELECTRICITY MARKETS 

  • Market institutions 

  • How does the available generation shape the supply curve 

––– Week 2 ––––––––––––––––––––––––––––––––––––––––––– 

Lecture 3     EXTERNALITIES 

  • Pigou and Coase, strategic behavior 

Lecture 4     COSTS VS. BENEFITS 

  • Measuring externalities, cost-benefit analysis 

––– Week 3 ––––––––––––––––––––––––––––––––––––––––––– 

Lecture 5     POLICY PRINCIPLES 

  • Policy menu 

  • Best choices: Prices vs. Quantities  

Lecture 6     POLLUTION TRADING 

  • EU Emission Trading Scheme 

––– Week 4 ––––––––––––––––––––––––––––––––––––––––––– 

Lecture 7     RENEWABLE ENERGY SUBSIDIES 

  • Renewable energy subsidies 

Lecture 8     INVESTMENTS 

  • Basics of investment analysis 

––– Week 5  ––––––––––––––––––––––––––––––––––––––––––– 

Lecture 9     STORAGE AND EXHAUSTIBLE RESOURCES 

  • Storage and time dynamics 

  • Exhaustible resource theory, hotelling rule 

Lecture 10   CLIMATE CHANGE ECONOMICS 

  • Social cost of carbon 

  • Integrated assessment models 

––– Week 6 ––––––––––––––––––––––––––––––––––––––––––– 

Lecture 11   CONSUMER BEHAVIOR 

  • Policy impacts on consumer choice 

Lecture 12   NEW TECHNOLOGIES 

  • Innovations 

Description

Registration and further information