Fuel Prices, Restructuring, and Natural Gas Plant Operations

Matthew Doyle () and Harrison Fell ()
Additional contact information
Matthew Doyle: Division of Economics and Business, Colorado School of Mines
Harrison Fell: Division of Economics and Business, Colorado School of Mines

No 2016-03, Working Papers from Colorado School of Mines, Division of Economics and Business

Abstract: Switching from coal-fired to natural gas-fired generation and increasing the thermal efficiency (energy generated per unit of energy burned) of fossil fuel fired electricity generation plants has been identified as ways of achieving meaningful emission reductions. In this study, we examine the fuel-price responsiveness across gas plant technologies and across the market structures in which the plants operate. We find that there are significant differences in the generation and efficiency responses of gas plants to fuel prices across generation technologies and market structures. Specifically, our results indicate that, regardless of market structure, generation from natural gas combined cycle (NGCC) plants is responsive to both coal and gas prices, but that generation from simple cycle (NGSC) plants only respond to gas prices. On the other hand, with respect to efficiency, we generally find that only NGCC plants operating in deregulated regions show statistically significant efficiency improvements in response to coal price increases and that, generally, neither NGCC or NGSC plants, regardless of market structure, respond in any significant way to gas prices. Finally, using these parameter estimates, we calculate emissions savings from efficiency improvements and fuel-switching possibilities.

Pages: 48 pages
Date: 2016-04
New Economics Papers: this item is included in nep-ene, nep-env and nep-reg
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://econbus-papers.mines.edu/working-papers/wp201603.pdf First version, 2016 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:mns:wpaper:wp201603

Access Statistics for this paper

More papers in Working Papers from Colorado School of Mines, Division of Economics and Business Contact information at EDIRC.
Bibliographic data for series maintained by Jared Carbone ().