World Energy Outlook 2006

illion dollars (2005)
Figure 8.5: Oil and Gas Export Revenues in the Middle East and North
Africa in the Reference and Alternative Policy Scenarios
1 600
1 400
1 200
1 000
800
600
400
200
0
2005 Reference Alternative Policy
Scenario 2030 Scenario 2030
Oil-export revenues
Gas-export revenues
Implications for Consumers
The energy and emissions savings in the Alternative Policy Scenario can be
achieved at net benefit (negative cost) to society. This is not to say the savings are
free, but rather that the higher capital spending to improve energy efficiency is
more than offset by savings in consumers’ fuel expenditures over the lifetime of
the equipment. These benefits are coupled with the additional benefits of
improved energy security and lower emissions of CO 2 and other pollutants.
These environmental and security gains, though difficult to express in monetary
terms, are nonetheless of increasingly high value to society. In some cases, policymakers
may consider them to be large enough alone to justify the policy
intervention; and, in certain circumstances, the public at large might agree.
More efficient appliances also often bring other, non-energy related benefits,
such as longer equipment lifetimes and lower maintenance costs.
It should be noted that all calculations here of the net economic benefit to
consumers are made using a zero discount rate (Box 8.1). In reality, consumers
will discount the benefits of the reduced energy bills. Discount rates will vary
according to the goods purchased. For example, consumers use one discount
rate – and different rates in different regions – to buy a double-glazed window
Chapter 8 - Assessing the Cost-Effectiveness of Alternative Policies 205
© OECD/IEA, 2007
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