[go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/p/ssb/dispap/430.html
   My bibliography  Save this paper

Climate change- lower electricity prices and increasing demand. An application to the Nordic Countries

Author

Listed:
Abstract
Concentration of greenhouse gases in the atmosphere influences the climate, which then alters the amount of primary energy for countries or regions where hydropower and wind power constitute important parts of the energy supply. Besides, the demand effect of temperature increases may be large in economies where heating and air-conditioning demand a large share of total energy. In this article, we apply climate change calculations from natural science and detailed inflow data from the authorities to estimate the change in primary energy supply of the hydropower-dominated Nordic electricity market. The estimated inflow model shows an increase in primary inflow in the next 40 years of 6-15% in the Nordic countries. An estimated temperature model shows a 2-4% initial drop in demand in the same time period, because of increasing temperature. Within the context of a perfect-competition electricity market model, we simulate the total market outcome. As primary supply increases, the production cost decreases, prices drop and the total demand increases as the price effect dominates the temperature effect. Since the hydropower plants are located away from large consumer groups, the stress on the transmission networks is dramatic for some regions, which in the next phase may trigger new investments in transmission network capacities.

Suggested Citation

  • Karina Gabrielsen & Torstein Bye & Finn Roar Aune, 2005. "Climate change- lower electricity prices and increasing demand. An application to the Nordic Countries," Discussion Papers 430, Statistics Norway, Research Department.
    • Handle: RePEc:ssb:dispap:430
    as

    Download full text from publisher

    File URL: https://www.ssb.no/a/publikasjoner/pdf/DP/dp430.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Rogers, J. Scott & Rowse, John G., 1989. "Canadian interregional electricity trade : Analysing the gains from system integration during 1990-2020," Energy Economics, Elsevier, vol. 11(2), pages 105-118, April.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Timilsina,Govinda R. & Toman,Michael A. & Karacsonyi,Jorge G. & de Tena Diego,Luca, 2015. "How much could South Asia benefit from regional electricity cooperation and trade ?," Policy Research Working Paper Series 7341, The World Bank.
    2. Wang, Can & Ye, Minhua & Cai, Wenjia & Chen, Jining, 2014. "The value of a clear, long-term climate policy agenda: A case study of China’s power sector using a multi-region optimization model," Applied Energy, Elsevier, vol. 125(C), pages 276-288.
    3. Timilsina, Govinda R. & Toman, Mike, 2016. "Potential gains from expanding regional electricity trade in South Asia," Energy Economics, Elsevier, vol. 60(C), pages 6-14.
    4. Watcharejyothin, Mayurachat & Shrestha, Ram M., 2009. "Regional energy resource development and energy security under CO2 emission constraint in the greater Mekong sub-region countries (GMS)," Energy Policy, Elsevier, vol. 37(11), pages 4428-4441, November.
    5. Abrell, Jan & Rausch, Sebastian, 2016. "Cross-country electricity trade, renewable energy and European transmission infrastructure policy," Journal of Environmental Economics and Management, Elsevier, vol. 79(C), pages 87-113.
    6. Aryal, Sushil & Dhakal, Shobhakar, 2022. "Medium-term assessment of cross border trading potential of Nepal's renewable energy using TIMES energy system optimization platform," Energy Policy, Elsevier, vol. 168(C).
    7. Watcharejyothin, Mayurachat & Shrestha, Ram M., 2009. "Effects of cross-border power trade between Laos and Thailand: Energy security and environmental implications," Energy Policy, Elsevier, vol. 37(5), pages 1782-1792, May.

    More about this item

    Keywords

    Climate change; electricity market;

    JEL classification:

    • Q11 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Agriculture - - - Aggregate Supply and Demand Analysis; Prices
    • Q21 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Demand and Supply; Prices
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:ssb:dispap:430. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: L Maasø (email available below). General contact details of provider: https://edirc.repec.org/data/ssbgvno.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.