Cross-Country Electricity Trade, Renewable Energy and European Transmission Infrastructure Policy

Jan Abrell and Sebastian Rausch

No 16/229, CER-ETH Economics working paper series from CER-ETH - Center of Economic Research (CER-ETH) at ETH Zurich

Abstract: This paper develops a multi-country multi-sector general equilibrium model, integrating high-frequency electricity dispatch and trade decisions, to study the e ects of electricity transmission infrastructure (TI) expansion and re- newable energy (RE) penetration in Europe for gains from trade and carbon dioxide emissions in the power sector. TI can bene t or degrade environ- mental outcomes, depending on RE penetration: it complements emissions abatement by mitigating dispatch problems associated with volatile and spa- tially dispersed RE but also promotes higher average generation from low- cost coal if RE production is too low. Against the backdrop of European decarbonization and planned TI expansion, we nd that emissions increase for current and targeted year-2020 levels of RE production and decrease for year-2030 targets. Enhanced TI yields sizeable gains from trade that de- pend positively on RE penetration, without creating large adverse impacts on regional equity.

JEL-codes: C68 F18 Q28 Q43 Q48 (search for similar items in EconPapers)
Pages: 42 pages
Date: 2016-01
New Economics Papers: this item is included in nep-ene, nep-eur and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (75)

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Journal Article: Cross-country electricity trade, renewable energy and European transmission infrastructure policy (2016)
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Persistent link: https://EconPapers.repec.org/RePEc:eth:wpswif:16-229

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