CO2 Emission Trading Effect on Baltic Electricity Market

Bariss, Uldis; Avenitis, Elvijs; Junghāns, Gatis; Blumberga, Dagnija

doi:10.1016/j.egypro.2016.09.016

Cited by 13 publications

(5 citation statements)

References 6 publications

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“…Other scholars have also found limited pass-through rates. Bariss et al (2016) find a 55% pass-through rate in the Nordic market and a 65% pass-through rate in Baltic countries. Bunn and Fezzi (2008) show that the pass-through rates can be as low as 42%.…”

Section: Introductionmentioning

confidence: 79%

Has the EU-ETS Financed the Energy Transition of the Italian Power System?

Caporin

Fontini

Segato

2021

IJFS

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This paper focuses on the relationship between the European Union Emission Trading System allowances’ prices and the Italian electricity price, aiming at assessing whether such a mechanism has been a driver for the decarbonization of the power sector. To this aim, we calculate the long-run relationships between energy prices, natural gas prices and allowances’ prices, through a VECM model, distinguishing between peak and off-peak prices. The analysis is carried out for the third phase of the EU-ETS, which started in 2013, and for two-year rolling windows that account for changes over time of the pass-through rates. It is shown that the natural gas price has a high pass-through rate of roughly 70%, which is increasing over time. On the contrary, the pass-through rate of the allowances’ price is as low as 7% for the wholesale electricity price, being slightly more and less for the peak and off-peak prices, respectively. However, this rate has been substantially changing over time, starting from a high level and falling significantly, becoming negative in the recent years. This could signal that the EU-ETS has been increasingly more effective in endogenizing emission costs for power producers, inducing them to reduce their production costs associated with emissions by means of a change in technologies. However, the analysis of the impulse response functions hardly supports this finding, eventually casting doubts on the effectiveness of the EU-ETS in Italy to drive the transition toward a less carbon-intensive power supply.

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Section: Introductionmentioning

confidence: 79%

Has the EU-ETS Financed the Energy Transition of the Italian Power System?

Caporin

Fontini

Segato

2021

IJFS

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“…Establish comprehensive public policy and industrial policy system that encourage the transformation of energy structure and industrial structure. On the one hand, in terms of increasing the R&D and innovation of basic originality and common technologies in the new energy industry, the government should play a greater role in the investment of basic R&D funds and the construction of common platforms for the formation of R&D achievements [ 70 , 71 ]. Since TFEE is the key to realize energy conservation and efficiency increase, it is necessary to promote the rational cross regional allocation of renewable energy and technology spillover effect.…”

Section: Policy Implicationsmentioning

confidence: 99%

The Energy Saving and Emission Reduction Effect of Carbon Trading Pilot Policy in China: Evidence from a Quasi-Natural Experiment

Zhang

2022

IJERPH

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Promoting the carbon emission trading system has been a crucial measure for China to fulfill its carbon neutrality commitment. Taking the carbon emission trading system implemented in China in 2013 as a quasi-natural experiment, based on the provincial panel data of China from 2005 to 2019, this paper adopts the difference-in-difference (DID) method and the synthetic control method (SCM) to evaluate the impact of the carbon emission trading system on energy conservation and emission reduction in pilot provinces and cities. The research findings reveal that, on the whole, the carbon emission trading system has significantly promoted the process of energy conservation and emission reduction in pilot provinces and cities. Other robustness tests, including the parallel trend test, PSM–DID stationarity test and placebo test have also been passed. Heterogeneity analysis shows that the most significant policy effects occur in Tianjin and Shanghai, followed by Hubei. The emission reduction effect of Guangdong displays a trend of first decreasing and then increasing. The test results demonstrate that the carbon emission trading system can strengthen the process of energy conservation and emission reduction by optimizing the industrial structure and energy structure. In conclusion, policy makers should coordinate the relationship between the government and the market and speed up the transformation of environmental policy from command control type to market incentive type. Meanwhile, improve the property right system and accelerate the promotion of carbon emission trading pilot policies in China according to local conditions. By encouraging technological innovation, a new market-oriented path of energy conservation and emission reduction guided by the enhancement of energy efficiency and the optimization of energy and industrial structures ought to be formed.

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“…Once compared to the electricity generation costs in coal-based power plant, which at present without CO2 fee equals ca. 40 EUR, the inclusion of carbon cost would result in tremendous increase of overall generation costs [15]. In fact this is exactly why the EAUs prices need to be so high as to make future investment in fossil fuel-based generation unprofitable and simply to avoid such investments.…”

Section: Future Electricity Generation MIX In Polandmentioning

confidence: 99%

Factors affecting the transition of the Polish power system

Suwała

Wyrwa

2019

E3S Web Conf.

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Energy systems face radical –almost revolutionary changes which, however, will be stretched over the long period. The critical factors influencing the future development of the Polish power sector are discussed in this paper. Development of intermittent energy supplies from renewable energy sources imposes a challenge on the entire power system and requires specific adaptations and responses from traditional generation units. Up to the present time they have been used to work in the stable mode while now they need more operational flexibility. The share of RES constantly increases. On one hand, this has a very positive environmental impact, but on the other it disturbs economics of classical generation units. Also liberalized electricity markets are impacted and the risks in power investments have increased. The capacity market could constitute a remedy, which will incentivise the investments necessary to fill the gap created by closing exhausted and inefficient plants. On the consumer side electromobility could change the demand, not only in quantity but also in terms of load profile. Climate policy tends to detriment coal based generation. For countries abundant in coal resources which make use of this cheap fuel, such as Poland, the question arises about its future role. Even in the most coal-supportive scenarios revised in this paper its relative share in electricity generation does not exceed 50% in 2050 while in others it rather goes much below 30%. .

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CO2 Emission Trading Effect on Baltic Electricity Market

Cited by 13 publications

References 6 publications

Has the EU-ETS Financed the Energy Transition of the Italian Power System?

Has the EU-ETS Financed the Energy Transition of the Italian Power System?

The Energy Saving and Emission Reduction Effect of Carbon Trading Pilot Policy in China: Evidence from a Quasi-Natural Experiment

Factors affecting the transition of the Polish power system

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