Today’s European utilities not only focus on electricity supply, but also offer exchange-traded “structured products” or portfolio management for unbundling financial and physical risk positions. Many utilities are only able to provide these services inside of their home markets, but in...

The aim of this study is to analyze the impact of credit risk mitigation via margining on the optimal portfolio selection for power plants. We develop a model to estimate margining cashflows that is based on the clearing framework of the European Commodity Clearing AG (ECC), on stochastic...

Institutions such as the European Commission (EC) are currently seeking to increase the transparency of the derivatives markets. This course of action includes in particular the installation of a centralized clearing entity and with this the obligation to clear all relevant financial...

In the electricity sector, most of the trades are still done in the OTC market without direct mitigation of credit risk. Newer discussions fuelled by the European Commission (EUCOM 2009a,b) show that there is a political will to enforce a stronger collateralization policy on all European...

Space heating accounts for a large fraction of the primary energy consumption and CO2 emissions of residential buildings. Besides targeting the insulation standard, residential heating systems (RHS) based on renewable energy sources offer the potential to reduce energy demand for space heating....

In this paper we estimate residential electricity demand elasticities and conduct an analysis of the causal relationship between electricity demand, disposable income and electricity price for a group of several OECD members. We apply panel cointegration and Granger causality testing to a data...

The economics of large-scale combined heat and power (CHP) generation for district heating (DH) applications are strongly affected by the costs and allocation mechanism of CO2 emission allowances. In the next period of the European emission trading system (EU ETS), from 2013 onwards, the...

In this paper, by using panel data and a fixed effects model, we estimate the direct rebound effect related to space heating in German residential households. The data used are from a representative repeated survey among some 11,000 households in Germany provided by the German Institute of...

In this paper, we apply a spread-based real options approach to analyze the decision-making problem of an investor who has the choice between an irreversible investment in a condensing power plant without heat utilization and a plant with combined heat-and-power (CHP) generation. Our...

In this paper we use multivariate cointegration analysis to estimate electricity demand elasticities at the subsectoral industry level. This enables us to reap the benefits of lower heterogeneity within the electricity-consuming sectors investigated and of retaining additional information...