Energy-only markets and renewable energy targets: Complementary policy or policy collision?

Economic Analysis and Policy

Volumn 46, Issue , 2015, Pages 25-42

  Nelson, Tim ^a   Reid, Cameron ^b   McNeill, Judith ^c  

^a GRIFFITH UNIVERSITY   (Australia)

^b Manager Carbon and Renewable Policy at AGL Energy Ltd   (Australia)

^c UNIVERSITY OF NEW ENGLAND   (Australia)

Author keywords

Barriers to exit; Energy only markets; Renewable energy

Indexed keywords

EID: 84928989119     PISSN: 03135926     EISSN: None     Source Type: Journal    
DOI: 10.1016/j.eap.2015.04.001     Document Type: Article

References (53)

1. 2014 Planning and Forecasting Scenarios 2014, Australian Energy Market Operator: AEMO, AEMO Publication, Melbourne.
2. Berrie T. The economics of system planning in bulk electricity supply. Electr. Rev. 1967, 425-468.
3. Besser J., Farr J., Tierney S. The political economy of long-term generation adequacy: Why an ICAP mechanism is needed as part of standard market design. Electr. J. 2002, 15:53-62.
4. Bidwell, M., Henney, A., 2004. Will NETA ensure generation adequacy? Power UK, No. 122, April.
5. Bushnell, J., 2010. Building blocks: Investment in renewable and non-renewable technologies', Energy Institute at Haas Working Paper, No. 202, Berkeley, California.
6. Caplan E. What drives new generation construction? an analysis of the financial arrangements behind new electric generation projects in 2011. Electr. J. 2012, 25(6):48-61.
7. Caplan E. Supplementing competition: direct payment constructs within restructured markets. Electr. J. 2014, 27(1):33-41.
8. Citi Research, 2013. Pan-European utilities: The lost decade, where next, Citi Research Equities Note, 17 June 2013.
9. Renewable Energy Target Review 2012, Climate Change Authority: CCA, CCA Publication, Melbourne.
10. Contract for Closure: Program Administrative Guidelines 2011, Commonwealth Government, Commonwealth Government Publication, Canberra.
11. The Community of Practice for Coal Utilisation: CPCU, 2014. 2014 Plant Database, The Community of Practice for Coal Utilisation, Brisbane.
12. Cramton P., Stoft S. The Convergence of Market designs for Adequate Generating Capacity with Special Attention to the CAISOs Resource Adequacy Problem 2006, Center for Energy and Environmental Policy Research, Cambridge, MA.
13. de Vries, L., 2003. The instability of energy-only electricity markets. In: Research Symposium: European Electricity Markets, The Hague, September 2003.
14. de Vries L. Securing the public interest in electricity generation markets, the myths of the invisible hand and the copper plate 2004, (Ph.D. dissertation), Delft University of Technology, The Netherlands.
15. de Vries L., Heijnen P. The impact of electricity market design upon investment under uncertainty: the effectiveness of capacity mechanisms. Util. Policy 2008, 16:215-227.
16. Department of Industry, Innovation, Climate Change, Science, Research and Tertiary Education: DIICCSRTE, 2013. Quarterly Update of Australia's National Greenhouse Gas Inventory December Quarter 2012, Canberra.
17. Edenhofer O., Hirth L., Knopf B., Pahle M., Schlömer S., Schmid E., Ueckerdt F. On the economics of renewable energy sources. Energy Econ. 2013, 40(Supplement 1):S12-S23.
18. Electricity Gas Australia 2013 2013, Energy Supply Association of Australia: esaa, esaa Publication, Melbourne.
19. ESAA Solar Report January 2014 2014, Energy Supply Association of Australia: esaa, esaa Publication, Melbourne.
20. Felder F. Examining electricity price suppression due to renewable resources and other grid investments. Electr. J. 2011, 24(4):34-46.
21. Finon D. Investment risk allocation in decentralised markets: the need of long-term contracts and vertical integration. OPEC Energy Rev. 2008, 32(2):150-183.
22. Finon D., Pignon V. Electricity and long-term capacity adequacy: the quest for regulatory mechanisms compatible with electricity markets. Util. Policy 2008, 16:143-158.
23. Joskow, P., 2006. Competitive electricity markets and investment in new generating capacity, Working Paper No. 06-14, AEI-Brookings Joint Centre for Regulatory Studies.
24. Joskow P. Capacity payments in imperfect electricity markets: need and design. Util. Policy 2008, 16:159-170.
25. Lewis, M., 2014. Europe's electric shock: Lessons for Australia, Report for the Energy Supply Association of Australia: esaa. Melbourne.
26. Nelson T., Kelley S., Orton F., Simshauser P. Delayed carbon policy certainty and electricity prices in Australia. Econ. Papers 2010, 29(4):446-465.
27. Nelson T., Kelley S., Orton F., Simshauser P. Delayed carbon policy certainty and electricity prices in Australia: A concise summary of subsequent research. Econ. Papers 2011, 31(1):132-135.
28. Nelson T., McNeill J., Simshauser P. From throughput to access fees: The future of network and retail tariffs. Distributed Generation and its Implications for the Utility Industry 2014, F. Sioshansi (Ed.).
29. Nelson T., Nelson J., Ariyaratnam J., Camroux S. An analysis of Australia's large scale renewable energy target: Restoring market confidence. Energy Policy 2013, 62(C):386-400.
30. Nelson J., Simshauser P. Is the merchant power producer a broken model. Energy Policy 2013, 53(C):298-310.
31. Nelson T., Simshauser P., Nelson J. Queensland solar feed-in tariffs and the merit-order effect: economic benefit, or regressive taxation and wealth transfers?. Econ. Anal. Policy 2012, 42(3):277-301.
32. Neuhoff, K., De Vries, L., 2004. Insufficient incentives for investment in electricity generation, CMI Working Paper 42, Cambridge.
33. Oren, S., 2003. Ensuring generation adequacy in competitive electricity markets, University of California Energy Institute - Energy Policy & Economics 007, University of California, Berkley.
34. Peluchon, B., 2003. Is investment in peak generation assets efficient in a deregulated electricity sector? In: Research Symposium: European Electricity Markets, The Hague, September 2003.
35. Renewables 2013 Global Status Report 2013, Renewable Energy Policy Network for the 21st Century: REN21, REN21 Publication, Paris.
36. Riesz, J., 2014. Will the NEM energy-only market work with high renewables? CSIRO FutureGrid Conference Presentation, February.
37. Riesz, J., Noone, B., MacGill, I., 2013. Payments for Closure: Should Direct Action include payments for closure of high emission coal-fired power plants? CEEM Working Paper.
38. Roques F., Newbery D., Nuttall W. Investment incentives and electricity market design: the British experience. Rev. Netw. Econ. 2005, 4(2):93-127.
39. Saddler, H., 2013. Power Down: Why is electricity consumption decreasing, Australia Institute Paper, No. 14.
40. Schweppe F., Caramanis M., Tabors R., Bohn R. Spot Pricing of Electricity 1988, Kluwer Academic Publishers, London.
41. Sensfuß F., Ragwitz M., Genoese M. The merit-order effect: A detailed analysis of the price effect of renewable electricity generation on spot market prices in Germany. Energy Policy 2008, 36(8):3086-3094.
42. Simshauser P. The emergence of structural faults on the supply side in deregulated 'energy only' electricity markets. Aust. Econ. Rev. 2006, 39(2):130-146.
43. Simshauser P. The dynamic efficiency gains from introducing capacity payments in the national electricity market. Aust. Econ. Rev. 2008, 41(4):349-370.
44. Simshauser P. Vertical integration, credit ratings and retail price settings in energy-only markets: Navigating the Resource Adequacy problem. Energy Policy 2010, 38(11):7427-7441.
45. Simshauser P. The cost of capital for power generation in atypical capital market conditions. Econ. Anal. Policy 2014, 44(2):184-201.
46. Simshauser P., Ariyaratnam J. What is Normal Profit for power generation?. J. Financ. Econ. Policy 2014, 6(2).
47. Simshauser P., Nelson T. The second-round effects of carbon taxes on power project finance. J. Financ. Econ. Policy 2012, 4(2):104-127.
48. Simshauser P., Nelson T. The outlook for residential electricity prices in Australia's National Electricity Market in 2020. Electr. J. 2013, 26(4):66-83.
49. Simshauser P., Nelson T. The Australian east coast gas supply cliff. Econ. Anal. Policy 2014, 45(1):69-88.
50. Simshauser P., Nelson T., Doan T. The boomerang paradox, part II: policy prescriptions for reducing fuel poverty in Australia. Electr. J. 2011, 24(2):63-75.
51. Simshauser P., Wild P. The Western Australia power dilemna. The Australian Economic Review 2009, 48(4):342-369.
52. Sioshansi F. EEnergy Informer: The Internat. Energy Newsletter 2013, 23(8).
53. Wen F., Wu F., Ni Y. Generation capacity adequacy in the competitive electricity market environment. Electr. Power Energy Syst. 2004, 26:365-372.