Date of Award

Spring 1-1-2013

Document Type

Dissertation

Degree Name

Doctor of Philosophy (PhD)

Department

Economics

First Advisor

Jonathan Hughes

Second Advisor

Nicholas Flores

Third Advisor

Donald Waldman

Fourth Advisor

Scott Savage

Fifth Advisor

Steven Pollock

Abstract

This work comprises three investigations in energy, environmental and public economics: (1) estimation of tax evasion and subsidy pass-through under the Solar Investment Tax Credit (ITC), (2) estimation of increased uptake of residential PV systems in response to the California Solar Initiative (CSI) cash rebate program, and (3) estimation of the increase in ambient ozone levels due to a cost-saving condensed work week program for state employees in Salt Lake City, Utah.

The first chapter hypothesizes that firms in the third party PV industry over-report prices in order to exploit tax benefits increasing in price under the ITC program. Using fixed-effects and nearest neighbor propensity score matching, I find that on average firms inflate reported prices by 8%, or $3,000 per system, leading to $20 million in tax evasion under the ITC in California between 2007 and 2011. Secondly, I exploit exogenous variation in benefits under the ITC stemming from lifting of the $2,000 cap in 2009 to estimate a model of subsidy incidence under the ITC in the customer owned PV market. I find that consumers realize only a small portion of ITC benefits, with 83% passed through to firms.

The second chapter explores the role of the upfront cash rebate program for PV under the CSI. We find that a 10% increase in the rebate rate has a large positive effect on adoptions, increasing the uptake rate by 14% at the mean, and that overall 58% fewer installations would have occurred in the absence of the CSI rebate program. We calculate average abatement costs under the program to be between $54 and $57 per metric ton of carbon dioxide avoided.

The final chapter explores the unintended air quality consequences of a condensed work week (CWW) policy for public employees in Utah's Salt Lake City metro area, moving employees to a 4-day work week. I find that the policy had the perverse effect of increasing levels of ambient ozone. The maximum daily ozone level on Fridays, the week day immediately affected by the program, increased by 3 ppb or 5% over pre-CWW levels.

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