• Environmental and Resource Economics Review
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• v.15 no.1
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• pp.95-133
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• 2006

This research first reviewed and analysed the current domestic situation of the voluntary agreement implementation and then it developed the policy implementation scenarios which will be applied to the model, KORTEM_ V.2. The model, consisted with 83 industries and commodities, examined the economic and environmental impacts of this policy instrument. Depending on the efforts of participating sectors and agents for fuel substitution and energy efficiency improvement, it has been evaluated that the voluntary agreement could be the "no-regret" policy. In other words, if the participating sectors and agents can achieve the voluntary energy conservation and emission reduction target without the negative impact on output level, the reduction of national emission will be achieved by creating the economic benefit, simultaneously. Therefore, for the successful implementation of voluntary agreement, this study emphasized the importance of expansion and strengthening of the current financial and institutional support for participating sectors and agents.

• Environmental and Resource Economics Review
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• v.17 no.2
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• pp.313-326
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• 2008

This paper is concerned with the effect of an increase in the import price of LNG on the Korean economy and industries. A computable general equilibrium analysis is applied to compute the comparative-statical effect of 10% rise of LNG price. The price increase places relatively heavy burden on the city gas, oil products and thermal power, decreasing their outputs and domestic sales by relatively larger percentages than other industries. The 10% increase in the LNG price reduces GDP by 0.4% and raises the general price level by 0.08%. The increase in oil price resulting in the same decreasing rate of GDP caused by the 10% LNG price rise turns out to raise the general price level and reduce the consumer's welfare in terms of equivalent variation by less percentage than the increase in LNG price.

• Environmental and Resource Economics Review
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• v.27 no.1
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• pp.29-66
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• 2018

This study constructs an energy-extended KLEM DB of 35 Korean industries, and estimates the elasticities of substitution under various nesting structures of production technologies. Unlike most existing studies that employed only three inputs, K, L, and E, we applied a dual approach where non-energy intermediate input M is also incorporated as a production input. Our dual approach which extended that of van der Werf (2008)'s 3-input model successfully identified and estimated the multi-nested production functions. We provide the estimates of the elasticities of substitution among 4 different energy sources as well. Our estimation results would be used for energy-environment model building for Korea.

• Journal of the Korea Academia-Industrial cooperation Society
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• v.17 no.8
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• pp.502-507
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• 2016

The transition from a carbon economy based on fossil fuels to a hydrogen economy is necessary to ensure energy security and to combat climate change. In order to pursue the transition to a hydrogen economy while achieving sustainable economic growth, a preliminary study into the establishment of the necessary infrastructure for the future hydrogen economy needs to be carried out. This study addresses the economic and environmental interactions in a dynamic computable general equilibrium (CGE) model focusing on the economic effects of the introduction of renewable energy into the Korean energy system. Firstly, the introduction of hydrogen results in an increase in the investment in hydrogen production and the reduction of the production cost, ultimately leading to GDP growth. Secondly, the mandatory introduction of renewable energy and associated government subsidies bring about a reduction in total demand. Additionally, the mandatory introduction of hydrogen energy into the power sector helps to reduce CO2 emissions through the transition from a carbon economy-based on fossil energy to a hydrogen economy. This means that hydrogen energy needs to come from non-fossil fuel sources in order for greenhouse gases to be effectively reduced. Therefore, it seems necessary for policy support to be strengthened substantially and for additional studies to be conducted into the production of hydrogen energy from renewable sources.