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Incentive Effects of Environmental Adders in Electric Power Auctions

Author

Listed:
  • James B. Bushnell
  • Shmuel S. Oren

Abstract

We make a systematic examination of the options for incorporating environmental adders into auctions for non-utility generation. To date, adders have been a popular tool of some regulators for the planning process, but have not been embraced as a tool for operations. We argue that any rational implementation of adders into a competitive acquisition process will have at least an indirect effect on the operations of the resulting electric system. If adders are to be employed, regulators must therefore be comfortable enough with them to use them explicitly in both the operation and selection of generation resources.

Suggested Citation

  • James B. Bushnell & Shmuel S. Oren, 1994. "Incentive Effects of Environmental Adders in Electric Power Auctions," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3), pages 55-74.
    • Handle: RePEc:aen:journl:1994v15-03-a04
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    Cited by:

    1. Kocagil, Ahmet E, 1997. "Portfolio choice of government incentives: the case of commercialization of a new coal-based technology," Energy Policy, Elsevier, vol. 25(10), pages 887-896, August.
    2. D'Sa, Antonette, 2005. "Integrated resource planning (IRP) and power sector reform in developing countries," Energy Policy, Elsevier, vol. 33(10), pages 1271-1285, July.

    More about this item

    JEL classification:

    • F0 - International Economics - - General

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