December 07, 2009

We begin our analysis by assuming that any regulation of carbon based fuels will result in the higher cost of carbon fuels. We decided to document the behavior of different industries during periods of high and rising fuel prices as well as periods of low and falling fuel prices. We focused on the industries’ fuel intensity defined as the amount spent on energy per unit of output. We also focused on the flexibility of the various industries to use other fuels and, thus, alter their energy costs.

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