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Assessment of emission trading impacts on competitive electricity market price

S.N. Singh (Department of Electrical Engineering, Indian Institute of Technology Kanpur, Kanpur, India)
D. Saxena (Department of Electrical Engineering, Invertis Institute of Engineering & Technology, Bareilly, India)
Jacob Østergaard (Centre of Electric Technology, Denmark Technical University, Kongens Lyngby, Denmark)

International Journal of Energy Sector Management

ISSN: 1750-6220

Article publication date: 13 September 2011

Abstract

Purpose

Besides organizational changes in the electricity supply industry there are growing concerns about environmental issues derived from the Kyoto Protocol for the reduction of greenhouse gas emissions as well as promoting renewable energies. The purpose of this paper is to address the source side emission trading impact on electricity prices in the competitive power market.

Design/methodology/approach

Various schemes are suggested and are being implemented to achieve this objective. It is expected that electricity price will increase due to imposition of emission taxes. This paper analyzes the impact of electricity prices in the competitive electricity markets having a uniform market clearing price mechanism.

Findings

It is found that the electricity prices depend on the system loading, generation mix, etc. at a particular hour. Various emission trading instruments are discussed with a special emphasis on the European market.

Research limitations/implications

Block bidding of the suppliers is considered whereas the demand is assumed to be inelastic.

Originality/value

The emission trading impacts are analyzed on a simple example.

Keywords

Citation

Singh, S.N., Saxena, D. and Østergaard, J. (2011), "Assessment of emission trading impacts on competitive electricity market price", International Journal of Energy Sector Management, Vol. 5 No. 3, pp. 333-344. https://doi.org/10.1108/17506221111169854

Publisher

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Emerald Group Publishing Limited

Copyright © 2011, Emerald Group Publishing Limited