A Spatial Equilibrium Analysis of Transmission Charge Reform in Japan's Electric Power Industry
AbstractA key intention of the regulatory reform of transmission charge schemes on Japan's electric power market was to promote inter-regional competition between power suppliers by lowering long-distance transmission charges with a postage-stamp charge scheme. This can lead to extensive use of inter-regional links and cause congestion. Congestion segments the market into several regional markets, making the reform less successful. We developed a nine-region spatial equilibrium model to simulate the reform at the peak-load hour. We found the reform would lead to significant increases of inter-regional transmission and congestion at the link between the 50-Hz area and the 60-Hz area.
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Bibliographic InfoPaper provided by Research Institute of Economy, Trade and Industry (RIETI) in its series Discussion papers with number 06022.
Length: 20 pages
Date of creation: Apr 2006
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This paper has been announced in the following NEP Reports:
- NEP-ALL-2006-04-22 (All new papers)
- NEP-COM-2006-04-22 (Industrial Competition)
- NEP-ENE-2006-04-22 (Energy Economics)
- NEP-GEO-2006-04-22 (Economic Geography)
- NEP-SEA-2006-04-22 (South East Asia)
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