nep-reg New Economics Papers
on Regulation
Issue of 2020‒07‒27
fifteen papers chosen by
Natalia Fabra
Universidad Carlos III de Madrid

  1. Barriers to grid-connected battery systems: Evidence from the Spanish electricity market By Yu Hu; David Soler Soneira; Mar\'ia Jes\'us S\'anchez
  2. Future Electric Vehicle Charging Demand at Highway Rest Areas and Implications for Renewable Energy Penetration in California By Kiani, Behdad; Ogden, Joan; Sheldon, F. Alex; Cordano, Lauren
  3. Economising on network provision while preserving competition: the challenges of 5G mobile network sharing By Pápai, Zoltán; McLean, Aliz; Csorba, Gergely; Nagy, Péter
  5. The Conditional Relationship between Renewable Energy and Environmental Quality in Sub-Saharan Africa By Asongu, Simplice; Iheonu, Chimere; Odo, Kingsley
  6. Reaching New Lows? The Pandemic's Consequences for Electricity Markets By David BENATIA
  7. Playing Easy or Playing Hard to Get: When and How to Attract FDI By Gresik, Thomas A.; Schindler, Dirk; Schjelderup, Guttorm
  8. 'Dark Patterns': the case for regulatory pluralism By Leiser, Mark
  9. Potential Influences on the Prospect of Renewable Energy Development in OPEC Members By Alsadi, Hanan
  10. The POTEnCIA Central scenario: An EU energy outlook to 2050 By Leonidas Mantzos; Tobias Wiesenthal; Frederik Neuwahl; Mate Rozsai
  11. Large Time-Varying Volatility Models for Electricity Prices By Angelica Gianfreda; Francesco Ravazzolo; Luca Rossini
  12. Externalised costs of electric automobility: Social-ecological conflicts of lithium extraction in Chile By Schlosser, Nina
  13. Lessons from Two Public Sector Reforms in Italy By Nazim Belhocine; La-Bhus Fah Jirasavetakul
  14. Rebating Antitrust Fines to Encourage Private Damages Actions By Emons, Winand; Lehnhard, Severin
  15. Co-construction of innovation processes: What types of innovation networks do exist in digital agriculture ? By Boris Biao; Leila Temri; Nina Lachia

  1. By: Yu Hu; David Soler Soneira; Mar\'ia Jes\'us S\'anchez
    Abstract: Electrical energy storage is considered essential for the future energy system to solve the intermittency problems caused by renewable energy sources such as wind and solar power. Among all the energy storage technologies, battery systems may provide flexibility in a more distributed and decentralized way. In countries with deregulated electricity markets, grid-connected battery systems should participate in the electric power system and interact with other market players. In this study, the market designs of both wholesale markets and ancillary services in Spain are introduced, and the barriers to grid-connected battery storage are investigated under its specific market and regulatory framework. Finally, the numerical and empirical analysis suggests that the high cycle cost for battery is still the main barrier for grid-connected battery systems, and the flexibility offered by such systems would be currently the most promising comparative advantage for this novel technology. Additionally, a correct recognition of the barriers and advantages by all the stakeholders, including the system/market operator, policy maker, investor, and project manager, is the key factor to promote battery storage technologies in grid-connected applications. For market and system regulators, more efforts are necessary to reduce the barriers from regulatory framework, promote pilot projects, and design appropriate market products or services that adequately address the flexibility provided by different technologies.
    Date: 2020–06
  2. By: Kiani, Behdad; Ogden, Joan; Sheldon, F. Alex; Cordano, Lauren
    Abstract: California has goals to rapidly expand electric vehicle adoption, with executive orders calling for 1.5 million electric vehicles on the roads by 2025 and 5 million by 2030. Significant charging infrastructure will be needed to support these new vehicles. While many urban areas in California have prioritized construction of charging stations, most rural areas lack charging infrastructure. This deficit hinders electric vehicle adoption in rural areas and makes long distance electric vehicle travel difficult. To address this issue, Caltrans has begun investing in charging infrastructure in rural and underserved areas around the state, particularly at highway rest areas. However, an understanding of potential future intercity charging demand will be needed to inform continued investments in support of a growing electric vehicle fleet. This policy brief summarizes findings from researchers at the University of California, Davis, who collected state travel data and electricity demand data to run a model that identified optimal highway rest areas for electric vehicle charger installation and calculated how an increase in charging demand would affect the California electricity grid at selected highway locations. The project aimed to maximize the use and generation of solar and wind energy, while also increasing electric vehicle adoption and mobility in the state. View the NCST Project Webpage
    Keywords: Engineering, Electric vehicle charging, Electric vehicles, Intercity travel, Range (Vehicles), Renewable energy sources, Roadside rest areas, Solar power generation, Travel behavior, Travel demand
    Date: 2020–07–01
  3. By: Pápai, Zoltán; McLean, Aliz; Csorba, Gergely; Nagy, Péter
    Abstract: The aim of the paper is to discuss the challenges in the competition assessment of 5G mobile network sharing which emerge in addition to those which were relevant under 4G networks (or below). Chapter 2 of the paper briefly discusses the main types of mobile network sharing. Chapter 3 presents our analytical framework for the competition assessment of mobile network sharing agreements, built on the approach laid out in guidelines by the European Commission and European regulators, as well as competition cases in European jurisdictions. Throughout, we focus on radio access network (RAN) sharing. Chapter 4 brings 5G into the picture. Here we discuss five special 5G technology and service characteristics which pose new challenges to the competition assessment of 5G RAN sharing agreements and should be in the focus of future research.
    Keywords: mobile markets,network sharing,competition,competitive assessment,5G
    Date: 2019
  4. By: Zoltán Pápai (Infrapont Economic Consulting); Aliz McLean (Infrapont Economic Consulting); Péter Nagy (Infrapont Economic Consulting); Gábor Szabó (Infrapont Economic Consulting); Gergely Csorba (Infrapont Economic Consulting and Center of Economics and Regional Sciences – Institute of Economics)
    Abstract: The rollout of fifth generation mobile networks is progressing around the world, but 5G looks especially expensive compared to previous generations. Network sharing between two or more mobile operators is an obvious way to attain significant cost savings, but may also raise competition concerns. This paper first distinguishes between early and mature 5G, and then discusses the expected changes mature 5G brings to the assessment of active mobile network sharing agreements from a competition policy point of view. We focus on the three main concerns where 5G may bring the most significant changes in the evaluation compared to 4G: service differentiation, cost commonality between the parties and the parties’ ability and incentives to grant access to critical inputs to downstream competitors. For each of these concerns, we show that they are not easy to substantiate and in some cases the concerns may even become less grave than under 4G.
    Keywords: mobile telecommunication markets, network sharing, competition policy, competitive assessment, 5G
    JEL: K21 L13 L41
    Date: 2020–07
  5. By: Asongu, Simplice; Iheonu, Chimere; Odo, Kingsley
    Abstract: This paper complements existing literature by assessing the conditional relationship between renewable energy and environmental quality in a sample of 40 African countries for the period 2002 to 2017. The empirical evidence is based on fixed effects regressions and quantile fixed effects regressions. The findings from both estimation techniques show that renewable energy consistently decreases carbon dioxide (CO2) emissions. Moreover, the negative effect is a decreasing function of CO2 emissions or the negative effect of renewable energy on CO2 emissions decreases with increasing levels of CO2 emissions. In other words, countries with higher levels of CO2 emissions consistently experience a less negative effect compared to their counterparts with lower levels of CO2 emissions. Policy implications are discussed.
    Keywords: Panel econometrics; Renewable energy; Carbon emissions; Africa
    JEL: Q32 Q40 Q55
    Date: 2019–01
  6. By: David BENATIA (CREST (UMR 9194), ENSAE, Institut Polytechnique de Paris)
    Abstract: The large reductions in electricity demand caused by the COVID-19 crisis have disrupted electricity systems worldwide. This article draws insights from New York into the consequences of the pandemic for electricity markets. It disentangles the effects of the demand reductions, increased forecast errors, and fuel price drops on the day-ahead and real-time markets. From March 16 to May 31, New York has experienced a 6.5% demand reduction, prices have dropped, and producers have lost $87 million (-18%). This estimate extrapolates to $2.6 billion for the entire US. Looking forward, these new lows signal the needs for market design adjustments.
    Keywords: COVID-19, Demand, Energy, Electricity Markets.
    JEL: L94 Q02 Q41 Q47
    Date: 2020–06–05
  7. By: Gresik, Thomas A. (Dept. of Economics, University of Notre Dame); Schindler, Dirk (Erasmus School of Economics, Erasmus University Rotterdam); Schjelderup, Guttorm (Dept. of Business and Management Science, Norwegian School of Economics)
    Abstract: We study the link between a country’s institutional quality in tax collection and its optimal corporate tax policies in a model of heterogeneous multinationals that can shift income using both debt and transfer prices. Countries with weak institutional quality can be made worse off adopting policies that attract FDI as the benefits from higher wages and production are more than offset by tax base erosion. Countries with moderate institutional quality can gain from under-utilizing their ability to collect taxes, since the benefit of attracting more FDI outstrips the benefit of increased tax revenue. Countries with very strong institutions benefit from FDI and should utilize their full ability to collect taxes.
    Keywords: FDI; thin capitalization rules; transfer pricing; institutional quality
    JEL: F23 F68 H26 H32
    Date: 2020–06–30
  8. By: Leiser, Mark
    Abstract: ‘Dark patterns’ is a term commonly used by the web collective to describe a user interface that exploits users into doing something that they would not normally do. It is a coercive and manipulative design technique used by web designers when some sort of action is needed from a user - typically to begin the processing of personal data or indication of agreement to a contract. As dark patterns can compromise legal requirements like consent and privacy-by-design and legal principles found in both regimes, like fairness and transparency, this article analyses ‘dark patterns’ from a regulatory perspective. Two frameworks are critiqued: the European Union’s regime for data privacy and consumer protection. The paper also provides an overview of the enforcement measures available for the regulation of dark patterns. It concludes that a pluralistic approach that mixes the strengths of one regulatory regime while compensating for its weaknesses by the use of the other is needed to harness dark patterns.
    Date: 2020–07–16
  9. By: Alsadi, Hanan (Qatar University)
    Abstract: Countries across the world are increasing their share of renewable energy in their daily consumption. However, if this increasing trend in renewable energies would also prevail among Oil Producing Economic Countries (OPEC), is subject to debate. They all have abundant potential to invest in renewable energy sources. Yet, some of the Middle Eastern and Arab Gulf OPEC members do not have or have a small amount of renewable energy sources. In contrast, other members have significant renewable energy sources. The research is deficient in explaining why some OPEC members lag behind other members in their transition to renewable energy, including how Middle Eastern OPEC members are implementing renewable energy. the purpose of this paper is to explore the influences on OPEC members that result in some OPEC members starting to adopt renewable energy and others have not started. The paper proposes recommendations for those countries that are slow or reluctant to embrace renewable energy to achieve a transition from black to green.
    Date: 2020–06–13
  10. By: Leonidas Mantzos (European Commission - JRC); Tobias Wiesenthal (European Commission - JRC); Frederik Neuwahl (European Commission - JRC); Mate Rozsai (European Commission - JRC)
    Abstract: This report describes the evolution of the EU energy system until the year 2050 under the assumption that no further policies and measures are introduced beyond the end of 2017. The results show that both the energy and the carbon intensity of the European economy remain on a declining path in the 'Central' scenario set-up, but will miss mid-century targets. This evolution is driven by the continued impact of policies that are already in place in combination with technology progress, as well as by structural changes and the development of the prices of fossil fuels and of the CO2 allowances under the EU Emissions Trading System. The EU target to reduce GHG emissions by at least 40% from 1990 levels in 2030 will not be met under the assumptions of the scenario, confirming the need for additional policies and measures. The Central scenario was developed with the JRC´s energy model POTEnCIA and serves as reference point to which policy scenarios can be compared. It is the result of a transparent and iterative interactive exercise between the JRC, other Commission services and Member States' national experts within the POTEnCIA modelling framework.
    Keywords: Energy, Modelling, Energy System, Climate, Scenario
    Date: 2019–10
  11. By: Angelica Gianfreda; Francesco Ravazzolo; Luca Rossini
    Abstract: We study the importance of time-varying volatility in modelling hourly electricity prices when fundamental drivers are included in the estimation. This allows us to contribute to the literature of large Bayesian VARs by using well-known time series models in a huge dimension for the matrix of coefficients. Based on novel Bayesian techniques, we exploit the importance of both Gaussian and non-Gaussian error terms in stochastic volatility. We find that by using regressors as fuels prices, forecasted demand and forecasted renewable energy is essential in order to properly capture the volatility of these prices. Moreover, we show that the time-varying volatility models outperform the constant volatility models in both the in-sample model- fit and the out-of-sample forecasting performance.
    Keywords: Electricity, Hourly Prices, Renewable Energy Sources, Non-Gaussian, Stochastic-Volatility, Forecasting
    Date: 2020–07
  12. By: Schlosser, Nina
    Abstract: Nowadays, electric automobility is considered to be the magic bullet in combating the heating climate. The necessary raw materials for the transformation of automobility in the global North, however, originate mainly from the global South to where the socialecological costs are externalised. While the global North's externalisation society with its imperial mode of living drives the electric vehicle forward in the fast lane, it is the internalisation society of the global South that cushions the hidden costs from which nature as a whole and a particular part of the population increasingly suffer. Nonetheless, the propertied class with its immense power resources, and hopeful wage earners with their desire for a peripheric imperial mode of living defend this construct successfully from outside attacks to this day as the Chilean case proves. This contribution intends to reveal the social-ecological costs resulting from the lithium extraction in Chile as result of the electrification of passenger cars in the EU, on the one hand, and to explain the muddle of power structures, especially in the global South, on the other, while giving the responsible actors a face and the parties concerned a voice.
    Keywords: electric automobility,Imperial Mode of Living,externalisation,Peripheric Mode of Living,internalisation,lithium,Chile
    Date: 2020
  13. By: Nazim Belhocine; La-Bhus Fah Jirasavetakul
    Abstract: The reform of the Italian public administration has been a priority for at least two decades, with several major initiatives undertaken toward modernization and simplification. Notwithstanding laudable intentions, however, progress remains limited. This analysis is a case study of two reforms since 2016—on the rationalization of state-owned enterprises and of public procurement. It finds that original reform provisions were weakened or overturned, regulatory complexity and uncertainties in the application of the reforms blunted their impact, and enforcement mechanisms were inadequate. Addressing these gaps will be essential for successfully modernizing Italy’s public administration.
    Keywords: Public investments;Demographic indicators;Economic growth;Financial crises;Public procurement;Italy,public administration reform,public sector,state-owned enterprises,public procurement.,WP,public investment,SOEs,contract authority,procurement,MEF
    Date: 2020–02–21
  14. By: Emons, Winand; Lehnhard, Severin
    Abstract: To encourage private actions for damages in antitrust cases some jurisdictions subtract a fraction of the redress from the fine. We analyze the effectiveness of this policy. Such a rebate does not encourage settlement negotiations that would otherwise not occur. If, however, the parties settle without the rebate, the introduction of the reduction increases the settlement amount, yet at the price of reduced deterrence for those wrongdoers who are actually fined. Under a leniency program the rebate has no effect on the leniency applicant: she doesn't pay a fine that can be reduced. The overall effect of a fine reduction on deterrence is, therefore, negative.
    Keywords: Antitrust; Damages; deterrence; Leniency
    JEL: D43 K21 K42 L40
    Date: 2020–01
  15. By: Boris Biao (UMR MOISA - Marchés, Organisations, Institutions et Stratégies d'Acteurs - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - INRA - Institut National de la Recherche Agronomique - CIHEAM-IAMM - Centre International de Hautes Etudes Agronomiques Méditerranéennes - Institut Agronomique Méditerranéen de Montpellier - CIHEAM - Centre International de Hautes Études Agronomiques Méditerranéennes - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Montpellier SupAgro - Centre international d'études supérieures en sciences agronomiques, Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier); Leila Temri (UMR MOISA - Marchés, Organisations, Institutions et Stratégies d'Acteurs - Cirad - Centre de Coopération Internationale en Recherche Agronomique pour le Développement - INRA - Institut National de la Recherche Agronomique - CIHEAM-IAMM - Centre International de Hautes Etudes Agronomiques Méditerranéennes - Institut Agronomique Méditerranéen de Montpellier - CIHEAM - Centre International de Hautes Études Agronomiques Méditerranéennes - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier - Montpellier SupAgro - Centre international d'études supérieures en sciences agronomiques, Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier); Nina Lachia (Chaire AgroTIC - Montpellier SupAgro - Institut national d’études supérieures agronomiques de Montpellier)
    Keywords: digital innovation,innovation network,stakeholder network,agriculture
    Date: 2019–05–15

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