I extend multi-unit auction estimation techniques to a setting in which firms can express cost complementarities over time. In the context of electricity markets, I show how the auction structure and bidding data can be used to estimate these complementarities, which in these markets arise due...

Small decentralized power generation units (DG) are politically promoted because of their potential to reduce GHG-emissions and the existing dependency on fossil fuels. A long term goal of this promotion should be the creation of a level playing field for DG and conventional power generation....

Ueber das Fuer und Wider einer Foerderung Erneuerbarer Energien mittels spezifischer Foerderinstrumente wie dem EEG sowie ueber die bestmoegliche Ausgestaltung dieser Instrumente sind in den letzten Jahren viele sowohl praxisorientierte als auch wissenschaftliche Debatten gefuehrt worden. Dabei...

This paper explores the economic implications of different contract durations in markets for on-line (primary and secondary) reserve capacity in Germany with the crucial feature of separate markets for spot energy and reserve capacity provision. The analysis is based on an equilibrium model...

Investments in power generation assets are risky due to high construction costs and long asset lifetimes. Technology diversification in generation portfolios represents one option to reduce long-term investment risks for risk-averse decision makers. In this article, we analyze the impact of...

Liberalized electricity markets are characterized by fluctuating priceinelastic demand of non-storable electricity, often defined by a substantial market share held by one or few incumbent firms. These characteristics have led to a controversial discussion concerning the need for and the design...

A capacity mechanism next to the energy-only market provides necessary investment incentives that spot markets lack. The adequate capacity mix can only be achieved by accounting for the current transition phase to electricity generation with a growing share of renewables. We show that an...

Anecdotal evidence indicates that electricity producers use production failures to disguise strategic reductions of capacity in order to influence prices, but systematic evidence is lacking. We use a quasi-experimental set up and data from the Swedish energy market to examine such behavior. In a...

Coordinating the timing and location of new production facilities is one of the challenges of liberalized power sectors. It is complicated by the presence of transmission bottlenecks, oligopolistic competition, and the unknown prospects of low-carbon technologies. The authors build a model...

The growth in variable renewable energy (vRES) and the need for flexibility in power systems go hand in hand. We study how vRES and other factors, namely the price of substitute fuels, power price volatility, structural breaks, and seasonality impact the hedgeable power spreads (profit margins)...