The paper at hand examines the power system costs when a coal tax or a fixed bonus for renewables is combined with CO2 emissions trading. It explicitly accounts for the interaction between the power and the gas market and identifies three cost effects: First, a tax and a subsidy both cause...

Liberalization of network industries frequently separates the network from the other parts of the industry. This is important in particular for the electricity industry where private firms invest into generation facilities, while network investments usually are controlled by regulators. We...

By 2050, the European Union aims to reduce greenhouse gases by more than 80 %. The EU member states have therefore declared to strongly increase the share of renewable energy sources (RES-E) in the next decades. Given a large deployment of wind and solar capacities, there are two major impacts...

In this paper, the implications of alternative decarbonization pathways for Europe's power sector up until the year 2050 are analyzed. In specific, an electricity system optimization model is used to investigate the minimal costs of decarbonization under a stand-alone CO2 reduction target and to...