Munich Personal RePEc Archive

The competitive environment of the European electricity sector in the post-Kyoto scenarios

Carrillo-Hermosilla, Javier and Del Río, Pablo and Könnölä, Totti and García, Carlos (2006): The competitive environment of the European electricity sector in the post-Kyoto scenarios.

[img]
Preview
PDF
MPRA_paper_19390.pdf

Download (522kB) | Preview

Abstract

This paper shows how the uncertainty associated to the absence of a post-Kyoto regime regarding Greenhouse Gas mitigation is affecting investments in mitigation activities in the EU electricity sector and, thus, future emissions levels. Based on a wide survey of EU power companies, the paper identifies the most likely post-Kyoto scenarios considered by these firms and how they are coping with such uncertainty in their current investment decisions. The major conclusion is that the non-existence of a post-Kyoto regime is having a negative effect on current business investment decisions in mitigation activities, increasing risk premiums and financing costs. All in all, the companies surveyed foresee post-Kyoto compliance regimes with emissions trading systems that would guarantee the continuity of the value of the reductions made beforehand, although they differ in their perceptions of the form that a post-Kyoto regime could take.

UB_LMU-Logo
MPRA is a RePEc service hosted by
the Munich University Library in Germany.