Transmission constraints, intermittent renewables and welfare

Jacob LaRiviere and Xueying Lyu

Journal of Environmental Economics and Management, 2022, vol. 112, issue C

Abstract: We use the roll-out of a large transmission expansion in Texas’ electricity market to measure the market impacts of the transmission expansion on benefits of increased renewable capacity. The value of transmission expansion varies based upon how new renewable investment over the sample is attributed to transmission expansion: payback periods range from roughly 40 years (assuming no investment impact) to roughly 20 years (assuming observed capacity increases are due to transmission expansion). Payback periods also depend on how global pollutants like carbon and regional pollutants like PM 2.5 are internalized by regional policy makers, reducing the payback period further to as little as 11 years.

Keywords: Electricity; Industrial organization; Policy instruments (search for similar items in EconPapers)
JEL-codes: D03 Q58 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jeeman:v:112:y:2022:i:c:s0095069622000092

DOI: 10.1016/j.jeem.2022.102618

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