Gone with the Wind? An Empirical Analysis of the Equilibrium Impact of Renewable Energy

Research output: Contribution to journalArticleScientificpeer-review

Abstract

What are the final equilibrium impacts of renewable energy investments on consumer and producer surpluses? This paper offers an approach to quantify the surplus breakdown in a market dominated by renewables and sufficient storage to counterbalance their intermittency-the Nordic electricity market. Wind power entry has strong distributional impacts: 10% market share for wind generation changes the consumer side surplus by an amount that is equivalent to a 40% decline in expenditures, at the cost of incumbents' surplus. The surplus transfer is big enough to cover the cost of subsidizing entry.

Original languageEnglish
Pages (from-to)873-900
Number of pages28
JournalJournal of the Association of Environmental and Resource Economists
Volume7
Issue number5
DOIs
Publication statusPublished - 1 Sept 2020
MoE publication typeA1 Journal article-refereed

Keywords

  • electricity
  • renewables
  • storage
  • climate policies
  • PASS-THROUGH
  • ELECTRICITY
  • MARKET
  • COMPETITION
  • INDUSTRY
  • COSTS
  • WHOLESALE
  • POLLUTION
  • TAX

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