A ‘Regional Energy Hub’ for achieving a low-carbon energy transition

Burak Guler, Emre Çelebi and Jatin Nathwani

Energy Policy, 2018, vol. 113, issue C, 376-385

Abstract: The transition to a low-carbon energy economy will remain a cornerstone of national energy policies of countries committed to the climate change accord for decades to come. We think that transmission investment is one key policy instrument amongst other to help with this transition. We propose an enhanced role for investing in transmission capacity for inter-regional trade to allow effective fuel switching among countries through a physically connected market. We develop a conceptual framework of “Regional Energy Hubs” and propose a cost minimization model in support of a transmission investment strategy that integrates: (i) a key geopolitical parameter for countries that are geographically close in a region but under different political jurisdictions, judged as stable and receptive to firm trading arrangements, (ii) an economic parameter related to the fuel mix where the differences in a country's supply and demand characteristics are significant enough for allow mutual benefits to be realized through cost reduction, (iii) an environmental parameter linked to a country's carbon intensity that could benefit from the resources of a neighboring jurisdiction with lower intensities, and (iv) a financial parameter for each country within a region capable of attracting investment capital. A connected ‘Regional Energy Hub’ offers large economic and environmental benefit for transition to a low-carbon energy economy.

Keywords: Electricity markets; Transmission investment; Regional energy hub; Low-carbon energy economy (search for similar items in EconPapers)
Date: 2018
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0301421517307188
Full text for ScienceDirect subscribers only

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:eee:enepol:v:113:y:2018:i:c:p:376-385

DOI: 10.1016/j.enpol.2017.10.044

Access Statistics for this article

Energy Policy is currently edited by N. France

More articles in Energy Policy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().