Eirik S. Amundsen

The Danish Green Certificate System: some simple analytical results

We formulate a simple static equilibrium model for the electricity market taking account of both Green certificated and CO2-emission permits. The objective is to investigate the relationship between these markets under the existence of upper and lower price-bounds on the Green certificates, both in the short and in the long run.

Open access harvesting of the Northeast Atlantic minke whale

The purpose of this paper is to analyze open access exploitation of the Northeast Atlantic minke whale. In particular the question whether open access could lead to stock extinction is addressed. A bioeconomic model of the open access fishery is developed and estimated for data from Norwegian whaling. Numerical analysis shows that open access was not likely to have lead to stock extinction for the minke whale.

Moving costs and the microeconomics of intra-urban mobility

This paper considers the role of moving costs in long-term optimal moving strategies from a theoretical microeconomic point of view. Using a model of intertemporal utility maximization, we arrive at conditions for (i) the optimal number of moves, (ii) the optimal moving dates, and (iii) the optimal consumption of housing services and other goods in the periods between moves. Also, comparative static results are obtained.

Green Certificates and Market Power on the Nordic Power Market

The purpose of this study is to elucidate under which circumstances, how, and to what extent market power on the TGC market can be used to affect the entire electricity market. There are basically two reasons for being concerned with market power in TGC markets. One is that a small number of companies may have exclusive access to first rate sites for wind power generation. The other is that withdrawal of a small number of TGCs implies a multiple reduction of electricity consumption, with corresponding increases of end user prices. For the purpose of investigating the principles by which market power may be exercised in this setting a simple analytical model is designed and analytical results are derived. To investigate matters further a numerical model, based on the analytical model, is constructed for the Nordic countries. Among the Nordic countries only Sweden has a TGC market but there is a common Nordic electricity market with free trade of electricity. The analysis shows that Swedish companies possessing capacity for green electricity generation, indeed, have the ability to exercise market power on the common Nordic power market by withholding TGCs. However, the analysis reveals that an opening of TGC trade between the the Nordic countries to a large extent achieves the objective of eliminating the use of marketpower that would otherwise be established. Also, this may have a cushioning effect on the volatility of TGC prices.

Deregulation of the Nordic power market and environmental policy

Abstract A common Nordic power market will reduce total CO 2 emissions in the Nordic countries as compared to a situation of autarky and, thus, reduce the aggregate cost of complying to strict national CO 2 emission targets. A common market for CO 2 emission permits may reduce the aggregate cost further, but this cost reduction will be smaller the harsher the CO 2 emission constraints are. The economic gain of introducing a common Nordic power market will be particularly large in the case of a Swedish nuclear power phase out. In this case, the cost reduction of introducing a common market for CO 2 emission permits will not be very large.

Export of Norwegian hydropower under a common European regime of environmental taxes

Abstract Along with the efforts of the European Union to introduce third party access (TPA) in the transmission of electricity, a new export market for Norwegian low-cost hydropower is being opened. Since the generation of hydropower is environmentally clean (ie producing no emission of CO 2 , SO 2 etc), we would expect that Norwegian electricity could obtain a premium under a common European system of environmental taxes as compared to electricity based on coal, oil and natural gas. In this paper we set out to investigate the strategic position of Norwegian hydropower and, in particular, to study optimal decisions with respect to the installation of new export transmission lines. For this purpose, we construct an integrated long-run equilibrium model for the northern European electricity market determining production, consumption and trade.

Trade and price variation in an integrated European power market

This paper examines the potential gains in terms of increased social surplus from integrating the power markets in Europe and assesses the scope for free seasonal and diurnal trade in a setting of Third Party Access (TPA). We construct an equilibrium model at the level of the wholesale markets, taking account of the existing power generating infrastructure (of varying flexibility) as well as the existing transmission network interconnecting the countries involved. The model indicates an overall gain from integrating the power markets. Electricity prices are substantially reduced for all regions involved, thus implying a significant redistribution of income from producers to consumers. Trade flourishes with regions establishing themselves as either pure exporters, pure importers or as intermediaries acting as transit countries.

Hydroelectric rent and precipitation variability : The case of Norway

Abstract Norway is about to reorganize its electricity production sector from a predominantly administered one to one which is based on market prices and principles of efficiency. The objective of this paper is to model the energy sector and to measure the size of hydro rent before and after the reorganization. We construct a regionally diversified and integrated equilibrium model of production, transmission and distribution of hydroelectricity. Particular attention is paid to the role of precipitation variability for the size and regional variation of hydro rent. We consider alternative routes for assessing the size of hydro rent in a long-run perspective.

The Deregulated Electricity Markets in Norway and Sweden: A Tentative Assessment

This book focuses on the diversity of electricity reforms in Western Europe, drawing evidence from ten European Union memberstates plus Norway and Switzerland as associate members. The contributors analyse the various ways of introducing competition in the European electricity industries, and consider both the strategies of electricity companies and their behaviour in electricity marketplaces. They also offer an explanation of the differences of reforms by the institutions and the industrial structures of each country which shape the types of marketrules, industrial restructuring and public service regulations which have been adopted.

Seasonal fluctuations of demand and optimal inventories of a non-renewable resource such as natural gas

Abstract This paper considers the effects of underground gas storage in an integrated model of extraction, storage and distribution of a non-renewable resource. In addition to the provision of supply-security in cases of delivery shortfall, the installment of a storage unit for the resource may provide cost reducing production smoothing as demand fluctuates seasonally between trough and peak. In this paper we investigate social optimality w.r.t. production smoothing, both within the cycle of a year and over the span of several years until shut-down of operations.