Market Changes, Business Cycles and Fluctuations in Electricity Prices - EU Evidence from Germany and Slovenia

HFrance Krizanic and Zan Jan Oplotnik
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HFrance Krizanic: EIPF d.o.o. Economic institute -Pre ernova, Ljubljana, Slovenia
Zan Jan Oplotnik: Faculty of Economics and Business, University of Maribor, Slovenia

International Journal of Energy Economics and Policy, 2013, vol. 3, issue 2, 118-126

Abstract: This article deals with interesting oscillation pattern in electricity prices during the period of EU electric power supply liberalization process, its transition from infrastructure to market activity and during last economic crisis, when at first prices declined significantly, to be raised afterward and start to decline again during the last recession. Using empirical evidence from Germany and Slovenia and based on short theoretical background we try to explain how can such strong oscillations occur and what we can expect in the future? It was discovered that such oscillations can be connected with business cycles dynamic, only that electricity prices oscillations proved to be even stronger unless a major technological breakthrough occurs in the way energy is produced or spent. Economic growth affects electricity prices even in relative terms, causes growth in prices with respect to inflation and vice versa. To conclude, we can expect relative growth of electric power prices together with economic recovery in the near future, but growth should be moderately slower than growth of real GDP.

Keywords: Prices oscillation; Business Cycles; EU; Economic development; Supply-Demand; Forecasting and simulations; Electricity (search for similar items in EconPapers)
JEL-codes: E3 F4 G1 O1 Q4 (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eco:journ2:2013-02-1

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