Provision of renewable energy using green certificates: market power and price limits

Amundsen, Eirik S. and Nese, Gjermund (2002): Provision of renewable energy using green certificates: market power and price limits.

Abstract

We formulate an analytic equilibrium model for simultaneously functioning electricity market an a market for Green Certificates. The major focus of the paper is the effect of market power in a Green Certificate system. One of the main results is that the certificate system faced with market power basically may collapse into a system of feed in tariffs.

• Item Type: MPRA Paper
• Language: English
• Subjects: A - General Economics and Teaching > A2 - Economic Education and Teaching of Economics > A20 - General; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q2 - Renewable Resources and Conservation > Q28 - Government Policy; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q48 - Government Policy; Q - Agricultural and Natural Resource Economics ; Environmental and Ecological Economics > Q4 - Energy > Q42 - Alternative Energy Sources; C - Mathematical and Quantitative Methods > C7 - Game Theory and Bargaining Theory

References

Amundsen, E. S. and Mortensen, J.B., 2001, "The Danish Green Certificate System: Some simple analytical results", Energy Economics 23 (5), 489-509

Amundsen, E.S. and Mortensen, J.B., 2002, Erratum to "The Danish Green Certificate System: Some simple analytical results", Energy Economics 24, 523-524

Borenstein, S., Bushnell, J., 1999. "An empirical analysis of the potential for market power in California's electricity industry", The Journal of Industrial Economics, XVLII (3), 285-323.

Borenstein, S., Bushnell, J., Knittel, C.R., 1999." Market Power in Electricity Markets: Beyond Concentration Measures, The Energy Journal 20 (4), 65-88.