Nuclear Capacity Auctions

Sven-Olof Fridolfsson and Thomas P. Tangers

The Energy Journal, 2015, vol. 36, issue 3, 247-262

Abstract: We propose nuclear capacity auctions as a means to correcting the incentives for investing in nuclear power. In particular, capacity auctions open the market for large-scale entry by outside firms. Requiring licensees to sell a share of capacity as virtual power plant contracts increases auction efficiency by mitigating incumbent producers’ incentive to bid for market power. A motivating example is Sweden’s policy reversal to allow new nuclear power to replace old reactors.

Keywords: Capacity auctions; Investments; Market power; Nuclear power; Virtual power plants (search for similar items in EconPapers)
Date: 2015
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Journal Article: Nuclear Capacity Auctions (2015)
Working Paper: Nuclear Capacity Auctions (2011)
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Persistent link: https://EconPapers.repec.org/RePEc:sae:enejou:v:36:y:2015:i:3:p:247-262

DOI: 10.5547/01956574.36.3.sfri

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