IDEAS home Printed from https://ideas.repec.org/p/uct/uconnp/2025-08.html
   My bibliography  Save this paper

Cleaner but Volatile Energy? The Effect of Coal Plant Retirement on Market Competition in the Wholesale Electricity Market

Author

Listed:
  • Harim Kim

    (University of Connecticut)

Abstract

Energy transition from coal to gas is reshaping the power sector to rely more on gas generation, which is cleaner but has more variable input costs. Using counterfactual analysis, I study the competitive effects of this transition, considering several transition paths that differ in the types of firms involved in retiring coal plants and investing in gas plants. I show that the variable nature of the marginal cost of gas generation creates an environment in which market power could increase after the transition. However, the transition’s impact on competition depends on the characteristics of the firms investing in new gas generation; the adverse impact is mitigated under a well-planned transition that leads to a more competitive industry structure.

Suggested Citation

  • Harim Kim, 2025. "Cleaner but Volatile Energy? The Effect of Coal Plant Retirement on Market Competition in the Wholesale Electricity Market," Working papers 2025-08, University of Connecticut, Department of Economics.
    • Handle: RePEc:uct:uconnp:2025-08
    as

    Download full text from publisher

    File URL: https://media.economics.uconn.edu/working/2025-08.pdf
    File Function: Full text
    Download Restriction: no
    ---><---

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:uct:uconnp:2025-08. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Mark McConnel (email available below). General contact details of provider: https://edirc.repec.org/data/deuctus.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.