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A Ricardian Theory of Hydroelectric Power Development: Some Canadian Evidence

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  • Jean-Thomas Bernard

Abstract

Once a hydroelectric power site is operational, its production is constrained both by the available hydraulic energy that drives the turbines and by the installed capacity that limits the pace at which hydraulic energy can be turned into electricity. Different costs are associated with these two constraints. Assuming generating equipment mix cost minimization, the optimal stacking order under the load duration curve is derived when production is stationary and when it is growing exponentially. The analysis throws some light on a fairly widespread feature of Canadian hydroelectric power development: limited hydro power. The history of hydro power site development in British Columbia, Manitoba, and Quebec displays features consistent with the analysis.

Suggested Citation

  • Jean-Thomas Bernard, 1989. "A Ricardian Theory of Hydroelectric Power Development: Some Canadian Evidence," Canadian Journal of Economics, Canadian Economics Association, vol. 22(2), pages 328-339, May.
    • Handle: RePEc:cje:issued:v:22:y:1989:i:2:p:328-39
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    Cited by:

    1. Avetisyan, Misak & Bayless, David & Gnuni, Tigran, 2006. "Optimal expansion of a developing power system under the conditions of market economy and environmental constraints," Energy Economics, Elsevier, vol. 28(4), pages 455-466, July.
    2. MacLeod, Michael & Moran, Dominic & Spencer, Ian, 2006. "Counting the cost of water use in hydroelectric generation in Scotland," Energy Policy, Elsevier, vol. 34(15), pages 2048-2059, October.

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