A Spatial Equilibrium Analysis of Transmission Charge Reform in Japan's Electric Power Industry
A 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.
|Date of creation:||Apr 2006|
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- Matsukawa Isamu & Madono Seishi & Nakashima Takako, 1993. "An Empirical Analysis of Ramsey Pricing in Japanese Electric Utilities," Journal of the Japanese and International Economies, Elsevier, vol. 7(3), pages 256-276, September.
- Hansen, Lars Peter, 1982. "Large Sample Properties of Generalized Method of Moments Estimators," Econometrica, Econometric Society, vol. 50(4), pages 1029-54, July.
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