Auctions and trading in energy markets -- an economic analysis
AbstractAuctions are playing an increasingly prominent role in the planning and operation of energy markets. Comparing the New Electricity Trading Arrangements to the former electricity Pool in England and Wales requires some analysis of the relative merits of uniform versus discriminatory pricing rules, and use of the gas network in Britain and electricity interconnectors around Europe is allocated on the basis of auction results. In this paper we discuss the changes in the trading arrangements in the electricity industry in England and Wales as well as some of the results to date. We also look at the wider issue of using auctions to replace regulation by market solutions for managing the natural monopolies in energy markets.
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Bibliographic InfoPaper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 0233.
Date of creation: Oct 2002
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auctions; electricity; gas; interconnectors; networks;
Find related papers by JEL classification:
- D44 - Microeconomics - - Market Structure and Pricing - - - Auctions
- L5 - Industrial Organization - - Regulation and Industrial Policy
- L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
- L95 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Gas Utilities; Pipelines; Water Utilities
This paper has been announced in the following NEP Reports:
- NEP-ALL-2002-11-04 (All new papers)
- NEP-COM-2002-11-18 (Industrial Competition)
- NEP-ENE-2002-11-04 (Energy Economics)
- NEP-MIC-2002-11-20 (Microeconomics)
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