Household Demand for LPG in Brazilian States

Energy Economics

The purpose of this paper is to evaluate the sensitivity of fuel consumers regarding price and income, taking recent changes in the Brazilian fuel market into account. In this market, new market rules, energy policy towards fuel diversification and introduction of flex-fuel engines have determined fuel competition among gasoline, ethanol and compressed natural gas. Using a dynamic panel data model, demand equations for these three fuels are econometrically estimated to obtain consumer adjustment coefficients, price, cross-price and income elasticities in the short and long-run. In addition, the effect of the introduction of flex-fuel engines in the market and the rationality of consumers towards efficiency constraints of the engines were tested. Apart from considerable competition, results show that the dynamics of the Brazilian fuel market revolves around ethanol instead of gasoline. While demands for gasoline and natural gas are inelastic to price, demand for ethanol is elastic in...

Nova Economia

The need for changes in the current energy matrix is a reality due to the possibility of a shortage of fossil fuels and the environmental damage caused by emissions related to fossil fuel use. The correct prescription of public policies for energy markets depends on the knowledge of demand elasticities. Hence, the aim of this work was to estimate the main determinants of light fuel demands in Brazil. Dynamic and non-dynamic estimators were used, and the results indicated that both demands respond more to changes in gasoline prices than changes in ethanol prices. Therefore, public policies that aim to change consumption patterns should focus on gasoline prices.

Energy for Sustainable Development, 2004

Liquefied petroleum gas (LPG) is accessible to more than 98 % of households in Brazil according to the last household survey by the Institute of Geography and Statistics of Brazil in 2002. It has a slightly higher penetration than electricity which had reached 97 % of the 46.5 million households. Penetration of LPG in the rural areas is also remarkable; 93 % of rural households use LPG. In 2002 LPG consumption in the household sector reached 10 million (M) m 3 .

Energy Policy

Brazil is a pioneer in biofuels policies. Due to previous concerns (diversification of energy matrix and rural development) and new concerns (environmental issues) it is important to know the marginal effects of the demand for ethanol and gasoline in order to prescribe appropriate public policies. In addition to the core marginal effects (price and income) of a regular demand estimations, cross prices marginal effects have special appealing in the Brazilian fuel market because of substitution possibility between ethanol and gasoline after 2003 with the novel of flex fuel cars. Regarding estimation strategies, we performed non-neighbors purchase prices as instruments for ethanol and gasoline prices to solve endogeneity issues. Results showed ethanol s price elasticities around-1.5 and gasoline s elasticities around-0.8. Regarding flex fuel cars influence on elasticities, results indicate price and cross prices with higher elasticities for both demands after the introduction of flex fuel cars.

Energy Policy, 2017

The use of solid fuels (USF) for cooking is a key environmental health risk factor, affecting more than 2.8 billion people globally. The Sustainable /Development Goal seven (SDG7) aspires to ensure access to affordable, reliable, sustainable and modern energy for all by 2030. This will require transition toward modern cooking fuels such as Liquefied Petroleum Gas (LPG) and electricity. In Latin American and the Caribbean (LAC), 90 million people still rely on solid fuels for cooking. Access and price have been identified as the main factors that limit substitution of solid fuels by clean fuels. In this paper, we present an exploratory analysis of the effects of subsidy policies for LPG in reducing USF in LAC countries when controlling for indicators of socioeconomic development and urbanization. In LAC, subsidies to LPG have substantially contributed to accelerate the transition from USF to clean fuels for cooking. Targeted subsidies should be considered as a policy option to implement the SDG7 on clean energy. Making clean energy accessible to all has the co-benefits of preventing diseases and premature deaths. Understanding the transition processes from USF to cleaner fuels made by LAC countries can better inform policy making in other regions.

In order to analyze incentive policies towards biofuel, two groups of scenarios have been proposed: policies that increase gasoline prices, and policies that reduce hydrous ethanol price. Results showed that hydrous ethanol consumption is maximized when a federal tax of BRL 0.77/liter is applied on gasoline C, or if all taxes on hydrous ethanol are eliminated. However, while higher gasoline taxation reduces GDP and increases fuel prices and government revenues, the elimination of hydrous ethanol taxes leads to higher GDP and lower government revenues and inflation.

Energy Economics, 2003

Gasoline is one of the most important of the oil-derived products. Its importance is closely related to its participation in the value of imports of many countries and in a number of cases, it is one of the determinants of their balance of payment deficit, fiscal deficit and economic growth. As opposed to most nations, Brazil has had a gasoline substitute since 1985: alcohol. Many studies have tried to estimate the income and price elasticities of the demand for gasoline in several countries. This paper extends previous studies by estimating the cross-price elasticity between gasoline and alcohol. Our findings indicate that alcohol is an imperfect substitute for gasoline even in the long run. As a consequence, the need for a new fuel substitution must be initiated long before petroleum reserves vanish. JEL Classification: D1, D12, C32, Q41 São Paulo -Brazil Final Version: 03/07/02 1 We appreciate the research assistance of Fabiana Tito. Remaining errors are our responsibility.

Energy Economics, 2017

This study is intended to assess the sensitivity of demand for light fuels in Brazil to changes in prices and income, considering the unique characteristics of the Brazilian fleet, the lack of convergence across studies available for the domestic market and its importance in discussions on climate change and national security, among others. For this purpose, the shortand long-term price and income elasticities of light fuel demand were estimated using cointegration techniques, based on an empirical model that incorporates the unique features of the domestic market. Despite the characteristics of the Brazilian fleet, the results showed that the elasticities found for the national market are similar to those seen in other countries. The conceptual framework and empirical analysis that were used also allowed for a better understanding of the differences between the results of studies on demand for gasoline, ethanol or natural gas in Brazil and those found in the international literature, providing key players in the sector with crucial information for designing public policies and business strategies.

Energy Economics Letters, 2019

Contribution/Originality: This documents contribution to provide recommendations on energy policy in Indonesia with several energy policy references in other countries. The recommendation is to limiting the use of subsidized fuel with direct and closed distribution (learning from India), adjusting subsidized retail prices, and in line with affordable public transportation. 1. INTRODUCTION It is, of course, necessary to implement an environmental policy to save lives, but we need to look at this prospect from the perspective of the history of human civilization by using economic considerations. High-quality environmental demands are increasingly pushing the economy to play a role in policies on new standards, licensing, and taxation systems. Building arguments require coherent data and accurate information to predict the impact of an environmental policy. Thus, any environmental policy that has shown little tangible benefits will be increasingly difficult to replace (Hahn, 2000). Developing a policy takes a long time because it involves the use of various instruments relating to the field of environment and a cost-effectiveness analysis or cost-benefit analysis (Morgenstern and Landy, 1997). Decision

44th Congress, July 23-27, 2006, Fortaleza, Ceará, Brazil, 2006

Although some theoretical and empirical evidences show that under some level of income the relationship between income and the use of natural resources and environmental quality is inverted U-shaped (the well know EKC-Environmental Kuznets Curve), applied studies have shown that for the case of per capita energy consumption in Brazil the EKC doesn't applies. However, an improvement on environmental quality would be occurring be the substitution of the energy matrix to another one less intensive on pollutants. Objecting the extraction of this effect it had been done the estimation of several EKC's for different sources of fuel (petroleum, sugar-cane alcohol, natural gas, mineral and vegetal coal, residential and industrial hydroelectricity and wood). Once those sources of energy demand are, by substitution, correlated, it had been used the econometrical technique of the regression by SUR (Seemingly Unrelated Regressors). The final result had shown what was expected: the different energy sources are contemporaneously correlated and they are in most part positively correlated with income, actually some of then have increasing elasticity on income. Some simulations done indicates that the percent participation of the renewable sources of energy is decreasing along economic growth; and, the carbon emissions is exponential increasing on long-run (either renewable and non-renewable).