Many governments, electric utilities, and large electricity consumers have committed to deep decarbonization of the electricity sector by 2050 or earlier. Over at least the next 30 years, achieving decarbonization targets will require replacing most fossil-fueled generators with zero carbon wind and solar generation along with energy storage to manage intermittency and for balancing more…
Tag: Electricity
Electricity Markets in Transition and Crisis: Balancing Efficiency, Equity, and Security
Two electricity market crises following the lifting of post-Covid restrictions in 2021 and the natural gas supply interruptions in 2022, challenged the functioning of the EU electricity market and its design. This paper argues that the market design was already ripe for an overhaul as the efficient market paradigm has gradually become an instrument of…
Policy Reversals in Transitional Markets: The Effect of Changing Marginal Cost to Physical Order Dispatch in the Mexican Power Sector
This study explores the 2021 Mexican electric reform that proposes changing the power dispatch from a marginal-cost-based to a command-and-control physical system. The new law forces the state power company to dispatch before private generators. We use the GENeSYS-MOD techno-economic energy model to determine the reform’s effect on the power sector’s generation mix, energy emissions,…
Regulatory impact on Quality of Electricity Distribution Services: The case of Latin America and the Caribbean
In this study, we empirically estimate the impact of quality regulation based on economic incentives on the frequency and duration of power outages. First, based on a sample of 143 electricity distributors across Latin America and the Caribbean, we show that between 2003 and 2019, the System Average Interruption Duration Index (SAIDI) and the System…
The Role of Efficient Pricing in Enabling a Low-Carbon Electricity Sector
Producers and consumers will make the investments and innovations necessary to transition to a low carbon electricity supply industry only if they are compensated for their efforts. In the absence of explicit government support for these activities, this outcome will occur only if wholesale and retail prices provide this compensation. Efficient wholesale and retail pricing…
A Primer on Transmission Benefits and Cost Allocation
The cost of transmission facilities must be allocated to those within the transmission planning region that benefit from those facilities in a manner that is at least roughly commensurate with estimated benefits.” (FERC, 2010, p. 91) Benefits include reliability, economic and public policy related impacts. Turning the principle into a workable policy is important as…
The Roles of Government and the Public Utility in Achieving Universal Access to Electricity
Although Mozambique is blessed with abundant fossil fuel and renewable energy resources, achieving the national goal of universal access to electricity by 2030 is a formidable task. This paper describes the current energy sector landscape in the developing nation of Mozambique and provides an on-the-ground account of the conceptual framework guiding the public utility in…
Electricity market reform in Japan after Fukushima
This study reviews the status, progress, and policy issues related to the reform of the Japanese electricity market undertaken in response to the disaster at the Fukushima nuclear power plant in March of 2011. The reform has three stages: (1) establishment of a neutral organization of network operation, (2) extension of retail competition to household…
Enhancing the Reliability of Bulk Power Systems against the Threat of Extreme Weather: Lessons from the 2021 Texas Electricity Crisis
The February 2021 cold weather outages in Texas remain a subject of important investigation, and lessons learned from the crisis have broader relevance for bulk power systems around the world. This article focuses on the policy responses to what we view as the root causes of the extended blackouts: the insufficient preparation of electric generating…
Changes in Electricity Use following COVID-19 Stay-at-home Behavior
This article uses hourly electricity consumption data from the PJM Interconnection in the United States and stay-at-home metrics from cell phone location data to study the effect of the COVID-19 pandemic on electricity consumption using a difference-in-predicted-differences strategy. I show that while in the first months of the COVID-19 pandemic total electricity consumption declined by…