Ambitious European energy plans envisage a large increase in Variable Renewable Electricity (VRE), often located distant from demand and congesting existing transmission. Many countries recognise the importance of better locational signals for investment and operation, and possible changes to VRE support systems to reduce risk and cost. This article argues that an efficient low-carbon transition requires a suitable portfolio of reforms to transmission and market pricing and VRE support design, with different combinations suitable when some options (like spatial transmission charges or locational wholesale pricing) are ruled out. Forward-looking spatial transmission contracts offer the simplest decentralised solution for least-cost VRE expansion plans, failing which spatial planning may be needed to coordinate transmission delivery with VRE commissioning
Month: October 2026
Impact of crude oil price shocks on the lithium mining stocks
This study examines whether positive and negative shocks in crude oil prices are asymmetrically associated with movements in the stock prices of five major lithium mining corporations. Unlike studies that mainly examine linear co-movement between oil, lithium, and related financial markets, this study focuses on whether upward and downward oil-price movements transmit differently to lithium-oriented equities. Using the asymmetric causality test of Hatemi-J (2012), the results show no evidence that positive oil-price shocks predict positive movements in the stock prices of lithium mining corporations considered here. In contrast, negative oil-price shocks are associated with negative movements in most of these stock prices. The implications are therefore relevant for shareholders, portfolio managers, financial analysts, and corporate managers seeking to understand the exposure of lithium-oriented equities to oil-market downturns.