Carbon content of electricity futures in Phase II of the EU ETS
Harrison Fell, Beat Hintermann, and Herman Vollebergh
Authors registered in the RePEc Author Service: Beat Hintermann () and
Herman R.J. Vollebergh
The Energy Journal, 2015, vol. Volume 36, issue Number 4
We estimate the relationship between electricity, fuel and carbonpricesinGermany, France, the Netherlands, the Nord Pool market and Spain, using one-year futures for base and peakload prices for the years 2008-2011, corresponding to physical settlement during the second market phase of the EU ETS. We employ a series of estimation methods that allow for an increasing interactionbetweenelectricityand input prices on the one hand, and between electricity markets on the other. The results vary by country due to different generation portfolios. Overall, we find that (a) carbon costs are passed through fully in most countries; (b) under some model specifications, cost pass-through is higher during peakload than during baseload for France, Germany and the Netherlands; and (c) the results are sensitive to the degree of cross-commodity and cross-market interaction allowed.
JEL-codes: F0 (search for similar items in EconPapers)
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Working Paper: Carbon Content of Electricity Futures in Phase II of the EU ETS (2013)
Working Paper: Carbon content of electricity futures in Phase II of the EU ETS (2013)
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