A Generalized Nash–Cournot Model for the Northwestern European Natural Gas Markets with a Fuel Substitution Demand Function: The GaMMES Model

Ibrahim Abada, Steven Gabriel, Vincent Briat and Olivier Massol ()
Additional contact information
Ibrahim Abada: EDF R&D - EDF R&D - EDF - EDF, IFPEN - IFP Energies nouvelles, EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique
Steven Gabriel: UMB - University of Maryland [Baltimore]
Vincent Briat: EDF R&D - EDF R&D - EDF - EDF
Olivier Massol: LGI - Laboratoire Génie Industriel - CentraleSupélec - Université Paris-Saclay, City University of London, IFP School

Post-Print from HAL

Abstract: This article presents a dynamic Generalized Nash–Cournot model to describe the evolution of the natural gas markets. The major players along the gas chain are depicted including: producers, consumers, storage and pipeline operators, as well as intermediate local traders. Our economic structure description takes into account market power and the demand representation tries to capture the possible fuel substitution that can be made between the consumption of oil, coal, and natural gas in the overall fossil energy consumption. We also take into account long-term contracts in an endogenous way, which makes the model a Generalized Nash Equilibrium problem. We discuss some means to solve such problems. Our model has been applied to represent the European natural gas market and forecast, until 2030, after a calibration process, consumption, prices, production, and natural gas dependence. A comparison between our model, a more standard one that does not take into account energy substitution, and the European Commission natural gas forecasts is carried out to analyze our results. Finally, in order to illustrate the possible use of fuel substitution, we studied the evolution of the natural gas price as compared to the coal and oil prices.

Keywords: Energy markets modeling; Game theory; Generalized Nash–Cournot equilibria; Quasi-variational inequality (search for similar items in EconPapers)
Date: 2013-03
References: Add references at CitEc
Citations:

Published in Networks and Spatial Economics, 2013, 13, pp.1-42. ⟨10.1007/s11067-012-9171-5⟩

There are no downloads for this item, see the EconPapers FAQ for hints about obtaining it.

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:hal:journl:hal-04912929

DOI: 10.1007/s11067-012-9171-5

Access Statistics for this paper

More papers in Post-Print from HAL
Bibliographic data for series maintained by CCSD ().