using out-of-market measures. One such measure is "redispatching" power plants, i.e. increasing the output of one power … through voluntary markets. In this paper, we introduce a simple graphical model of a zonal spot market with a locational …, voluntary redispatch market to show that such a market-based solution should not be used in this setting. We solve the model …

deterministic, pollutant outputs and increasing marginal costs. We find that either market forces are strong enough to serve the … entire demand, or they are too weak such that the market fails and nothing is produced. This crucially depends on the … relative cost of renewable energy investments, such that relatively cheap renewable energy causes the market to fail. Welfare …