Impact of the carbon price on the integrating European electricity market

Piia Remes (née Aatola) (), Markku Ollikainen and Anne Toppinen

Energy Policy, 2013, vol. 61, issue C, 1236-1251

Abstract: We study the impact of the carbon price on the integrating electricity market in the EU. Our theoretical framework suggests that the price of carbon has a positive but uneven impact on electricity prices depending on the marginal production plant. The carbon price may increase price differences in the short run. We apply time series analysis on daily forward data from 2003 to 2011 and investigate whether we can find empirical evidence for our analytical findings. Our results support the hypotheses that integration in electricity prices has increased over time and that the carbon price has a positive but uneven impact on the integration of prices.

Keywords: European Union electricity market; EU ETS; Econometric analysis (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (27)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:enepol:v:61:y:2013:i:c:p:1236-1251

DOI: 10.1016/j.enpol.2013.06.036

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