A Social Welfare Analysis of the Iberian Electricity Market Accounting for Carbon Emission Prices

• Type: Article in International Scientific Journal
• Date: 2010

Authors

André Martins (Author) FEP; Fernando S. Oliveira (Author) FEP; Jorge Pereira (Author) FEP

Journal

Title: IET Generation Transmission & Distribution

Vol. 4 No. 2

Pages: 231-243

ISSN: 1751-8687

Indexing

ISI Web of Science

Scopus

Scientific classification

FOS: Engineering and technology > Electrical engineering, Electronic engineering, Information engineering

CORDIS: Technological sciences > Engineering > Electrical engineering ; Technological sciences > Engineering > Simulation engineering

Other information

DOI: 10.1049/iet-gtd.2009.0105

Abstract (EN): In this study, the authors analyse the social welfare impact of the integration of Portugal and Spain in the Iberian electricity market (MIBEL), taking into account the CO2 price for emissions trading. They model the impact of emissions trading on the daily clearing prices and generation scheduling, and its effects on the benefits of integration as a whole. They compare the impact of market integration in Portugal and Spain and show that the welfare impact of the MIBEL is dependent on the CO2 prices. From their analysis, they conclude high CO2 prices lead to a change in the merit order.Moreover, natural gas is the generation technology that most benefits from transmission constraints and from high CO2 prices, as in the base case it is mainly used as a peak technology.The authors have also found that increases in the CO2 prices do not lead to higher profits. Overall, the introduction of the MIBEL will increase social welfare by reducing generation costs and prices.

Language: English

Type (Professor's evaluation): Scientific