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Ring the alarm! Electricity markets, renewables, and the pandemic

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  • David Benatia

    (ENSAE Paris - École Nationale de la Statistique et de l'Administration Économique, HEC Montréal - HEC Montréal)

Abstract

The pandemic’s impacts on European electricity markets have been enormous, especially in countries with abundant low marginal costs of production like France. This article provides an in-depth quantitative study of the impacts of the crisis on the French electricity sector. During the first lockdown episode, France has experienced unparalleled reductions of electricity demand (−12%) and wholesale prices (−45%) resulting in gross revenue losses of 1.3 billion € (−47%) for market participants. This paper argues that the observed market outcomes during the crisis are somehow indicative of outcomes in a future with abundant renewable power, where prices will fall in a more sustainable way.
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  • David Benatia, 2022. "Ring the alarm! Electricity markets, renewables, and the pandemic," Post-Print hal-03523180, HAL.
    • Handle: RePEc:hal:journl:hal-03523180
    DOI: 10.1016/j.eneco.2021.105755
    Note: View the original document on HAL open archive server: https://hal.science/hal-03523180
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    Cited by:

    1. Nicolae-Marius Jula & Diana-Mihaela Jula & Bogdan Oancea & Răzvan-Mihail Papuc & Dorin Jula, 2023. "Changes in the Pattern of Weekdays Electricity Real Consumption during the COVID-19 Crisis," Energies, MDPI, vol. 16(10), pages 1-20, May.
    2. David BENATIA & Etienne BILLETTE de VILLEMEUR, 2019. "Strategic Reneging in Sequential Imperfect Markets," Working Papers 2019-19, Center for Research in Economics and Statistics.
    3. Fabra, Natalia, 2021. "The energy transition: An industrial economics perspective," International Journal of Industrial Organization, Elsevier, vol. 79(C).
    4. Marcin Malec & Grzegorz Kinelski & Marzena Czarnecka, 2021. "The Impact of COVID-19 on Electricity Demand Profiles: A Case Study of Selected Business Clients in Poland," Energies, MDPI, vol. 14(17), pages 1-17, August.
    5. Arkadiusz Kampczyk & Wojciech Gamon & Katarzyna Gawlak, 2023. "Integration of Traction Electricity Consumption Determinants with Route Geometry and Vehicle Characteristics," Energies, MDPI, vol. 16(6), pages 1-23, March.
    6. Graf, Christoph & Quaglia, Federico & Wolak, Frank A., 2021. "(Machine) learning from the COVID-19 lockdown about electricity market performance with a large share of renewables," Journal of Environmental Economics and Management, Elsevier, vol. 105(C).
    7. Rahat, Birjees & Nguyen, Pascal, 2022. "Risk-adjusted investment performance of green and black portfolios and impact of toxic divestments in emerging markets," Energy Economics, Elsevier, vol. 116(C).
    8. Pizarro-Irizar, Cristina, 2023. "Is it all about supply? Demand-side effects on the Spanish electricity market following Covid-19 lockdown policies," Utilities Policy, Elsevier, vol. 80(C).

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    More about this item

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q02 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Commodity Market
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q47 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy Forecasting

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