nep-reg New Economics Papers
on Regulation
Issue of 2016‒02‒04
five papers chosen by
Natalia Fabra
Universidad Carlos III de Madrid

  1. Intraday Markets for Power: Discretizing the Continuous Trading? By Karsten Neuhoff; Nolan Ritter; Aymen Salah-Abou-El-Enien; Philippe Vassilopoulos
  2. Efficient Promotion of Renewable Energy with Reverse Auctions By Sebastian Schäfer; Lisa Schulten
  3. Asymmetric Consumer Price Responses and Asymmetric Cost Pass-Through By Villas-Boas, Sofia B; Bonnet, Celine
  4. Climate Change and Long-Run Discount Rates: Evidence from Real Estate By Matteo Maggiori; Stefano Giglio; Johannes Stroebel; Andreas Weber
  5. Bans vs. Fees: Disposable Carryout Bag Policies and Bag Usage By Taylor, Rebecca L; Villas-Boas, Sofia B

  1. By: Karsten Neuhoff; Nolan Ritter; Aymen Salah-Abou-El-Enien; Philippe Vassilopoulos
    Abstract: A fundamental question regarding the design of electricity markets is whether adding auctions to the continuous intraday trading is improving the performance of the market. To approach this question, we assess the experience with the implementation of the 3 pm local auction for quarters in Germany at the European Power Exchange (EPEX SPOT) in December 2014 to assess the impact on trading volumes/liquidity, prices, as well as market depth. We discuss further opportunities and challenges that are linked with a potential implementation of an intraday auction.
    Keywords: Auctions, electricity, empirical analysis, market design
    JEL: C5 C93 D44 L50
    Date: 2016
  2. By: Sebastian Schäfer (University of Siegen); Lisa Schulten (University of Siegen)
    Abstract: Despite negative experiences with auctioning off subsidies for renewable energy in some countries, tenders are increasingly used today. We develop a reverse auction which accounts for particularities of intermittent renewable energy sources. Determining the quantity, demanded by the regulator, is internalized and directly linked to his two main objectives. On the one hand, the regulator seeks for a high share of renewable energy. On the other hand, he wants to enhance burden sharing between electricity consumers and renewable electricity producers. We further account for asymmetric information in reverse auctions. We analyze incentives for bidders to manipulate the auction outcome and adapt the design to prevent this behavior. Regional features as grid and generating capacity can be considered to optimize the deployment of renewable energy. We thereby introduce a link to fossil capacity auctions.
    Keywords: Auction Design, Tendering, Renewable Energy, Adverse Selection, Moral Hazard, Burden Sharing
    JEL: C72 D44 D82 L10 Q48
    Date: 2015
  3. By: Villas-Boas, Sofia B; Bonnet, Celine
    Keywords: Social and Behavioral Sciences
    Date: 2016–01–28
  4. By: Matteo Maggiori; Stefano Giglio; Johannes Stroebel; Andreas Weber
    Abstract: The optimal investment to mitigate climate change crucially depends on the discount rate used to evaluate the investment's uncertain future benefits. The appropriate discount rate is a function of the horizon over which these benefits accrue and the riskiness of the investment. In this paper, we estimate the term structure of discount rates for an important risky asset class, real estate, up to the very long horizons relevant for investments in climate change abatement. We show that this term structure is steeply downward-sloping, reaching 2.6% at horizons beyond 100 years. We explore the implications of these new data within both a general asset pricing framework that decomposes risks and returns by horizon and a structural model calibrated to match a variety of asset classes. Our analysis demonstrates that applying average rates of return that are observed for traded assets to investments in climate change abatement is misleading. We also show that the discount rates for investments in climate change abatement that reduce aggregate risk, as in disaster-risk models, are bounded above by our estimated term structure for risky housing, and should be below 2.6% for long-run benefits. This upper bound rules out many discount rates suggested in the literature and used by policymakers. Our framework also distinguishes between the various mechanisms the environmental literature has proposed for generating downward-sloping discount rates.
    Date: 2015–01
  5. By: Taylor, Rebecca L; Villas-Boas, Sofia B
    Keywords: Social and Behavioral Sciences
    Date: 2015–09–27

This nep-reg issue is ©2016 by Natalia Fabra. It is provided as is without any express or implied warranty. It may be freely redistributed in whole or in part for any purpose. If distributed in part, please include this notice.
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