Wind Generators and Market Power: Does It Matter Who Owns Them?

Nihat Misir

Publikation: KonferencebidragPaperForskningpeer review

Abstrakt

Electricity production from wind generators holds significant importance in European Union’s 20% renewable energy target by 2020. In this paper, I show that ownership of
wind generators affects market outcomes by using both a Cournot oligopoly model and a
real options model. In the Cournot oligopoly model, ownership of the wind generators by
owners of fossil-fueled (peakload) generators decreases total peakload production and increases the market price. These effects increase with total wind generation and aggregate
wind generator ownership. In the real options model, start up and shut down price thresholds are significantly higher when the monopolist at the peakload level owns both types of generators. Furthermore, when producing electricity with the peakload generator, the monopolist can avoid facing prices below marginal cost by owning a certain share of the wind generators.
OriginalsprogEngelsk
Publikationsdato2013
Antal sider26
StatusUdgivet - 2013
BegivenhedThe 17th Annual International Real Options Conference 2013 - University of Tokyo, Tokyo, Japan
Varighed: 25 jul. 201326 jul. 2013
Konferencens nummer: 17
http://www.realoptions.org/abstracts2013.html

Konference

KonferenceThe 17th Annual International Real Options Conference 2013
Nummer17
LokationUniversity of Tokyo
LandJapan
ByTokyo
Periode25/07/201326/07/2013
Internetadresse

Emneord

  • Uncertainty
  • Electricity
  • Wind

Citationsformater

Misir, N. (2013). Wind Generators and Market Power: Does It Matter Who Owns Them?. Paper præsenteret på The 17th Annual International Real Options Conference 2013, Tokyo, Japan. http://www.realoptions.org/openconf2013/data/papers/10.pdf