Optimal transmission regulation of an integrated energy market

Thomas Tangerås ()

Energy Economics, 2012, vol. 34, issue 5, 1644-1655

Abstract: The capacity of the transmission network determines the extent of integration of a multi-national energy market. Cross-border externalities render coordination of network capacity valuable. Is it then optimal to collect regulatory powers in the hands of a single regulator? Should a common system operator manage the entire network? I show that optimal network governance depends on (i) whether the centralized regulatory agency is able to balance the interests of the different countries; (ii) asymmetries across countries in the gains from market integration; (iii) network characteristics (substitutability versus complementarity); and (iv) the social cost of operator rent.

Keywords: Centralization; Multi-contracting; Multi-national energy market; System operation; Transmission regulation (search for similar items in EconPapers)
JEL-codes: D62 D82 L51 L94 Q48 (search for similar items in EconPapers)
Date: 2012
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (7)

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Working Paper: Optimal Transmission Regulation in an Integrated Energy Market (2010)
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:34:y:2012:i:5:p:1644-1655

DOI: 10.1016/j.eneco.2012.01.007

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