The Final Hurdle?: Security of supply, the Capacity Mechanism and the role of interconnectors

The UK Government has developed a carefully designed Capacity Mechanism to ensure security of supply in the GB electricity system. This paper criticises the methods used to determine the amount of capacity to procure, and argues that the amount finally proposed is likely to be excessive, particularly (but not exclusively) in ignoring the contribution from interconnectors. More broadly, there has been too little attention to either the political economy, or the option value aspects. Procuring too little is risky, but fear of'the lights going out' can easily become a catch-all argument for excessive procurement, and associated subsidy. The risk of over-procurement, particularly of new capacity on long-term contracts, is that it drives up the costs to consumers; undermines renewable energy by transferring capped resources from renewable to fossil fuel producers; and impedes the Single Market including by weakening the business case for future interconnectors. The paper argues that the development of technologies and markets, particularly on the demand- side and of potentially available – 'latent' – capacity - further lowers the risks and increases options. This implies greater potential to defer more capacity procurement – and enhances the value of a more appropriate treatment of interconnectors in security assessments

UK Electricity Market Reform and the Energy Transition: Emerging Lessons

The 2013 Electricity Market Reform (EMR) was a response to problems of delivering reliability with a growing share of renewables in its energy only market. Four EMR instruments combined to revolutionise the sector; stimulating unprecedented technological and structural change. Competitive auctions for both firm capacity and renewable energy have seen prices far lower than predicted and the entry of unexpected new technologies. A carbon price floor displaced coal, whose share fell from 46% in 1995 to 7% in 2017, halving CO2. Renewables grew from under 4% in 2008 to 22% by 2017, projected at 30+% by 2020 despite a political ban on onshore wind. Neither the technological nor regulatory transitions are complete, and the results to date highlight other challenges, notably to transmission pricing and locational signals. EMR is a step forwards, not backwards; but it is not the end of the story

Reforming Electricity Markets for the Transition: Emerging Lessons from the UK's Bold Experiment

Until 1990, the UK - like many other countries - had an electricity system that was centralised, state-owned, and dominated almost entirely by coal and nuclear power generation. The privatisation of the system that year and its creation of a competitive electricity market attracted global interest, helping to set a path which many have followed. Two decades later, however, the UK government embarked on a radical reform which some critics described as a return to central planning. The UK's Electricity Market Reform (EMR), enacted in 2013, has correspondingly been a topic of intense debate and global interest in the motivations, components, and consequences. This report summarises the evolution of UK electricity policy since 1990 and explains the EMR in context: its origins, rationales, characteristics, and results to date. We explain why the EMR is a consequence of fundamental and growing problems with the form of liberalisation adopted, particularly after 2000, combined with the growing imperative to maintain system security and cut CO2 emissions, whilst delivering affordable electricity prices. The fifteen years after privatisation, coinciding with the era of low fossil fuel prices, had seen mostly falling electricity bills; from about 2004 they started to rise sharply, for multiple reasons including increasing fossil fuel prices, the need for new investment in both generation and transmission, and inefficient renewables policies. The four instruments of the EMR have indeed combined to revolutionise the sector; they have also both drawn on, and helped to spur, a period of unprecedented technological and structural change. Competitive auctions for both firm capacity and renewable energy have seen prices far lower than predicted, with the fixed-price auctions for renewable sources estimated to save over £2bn/yr in the cost of financing the projected renewables investments, compared to the previous support system. A minimum carbon price level has brought cleaner gas to the fore, displacing coal. Electricity prices may have peaked from 2015, with energy efficiency helping to lower overall consumer bills. New forms of generation have expanded rapidly at all scales of the system. Renewable electricity in particular has grown from under 5% of generation in 2010, to almost 25% by 2016, and is projected to reach over 30% by 2020 despite a political de-facto ban on the cheapest bulk renewable, of onshore wind energy. The environmental consequences overall have been dramatic: coal generation has shrunk from about 2/3rd of generation in 1990, to 35% in 2000, to 10% in 2016, halving CO2 emissions from power generation over the quarter century. Neither the technological nor regulatory transitions are complete, and the results to date highlight other challenges. The Capacity Mechanism has proved ill-suited to encouraging demand-side response, and in combination with the growing share of renewables, has underlined problems in transmission pricing. As the share of variable renewables grows further, the associated contracts will require reform to improve siting efficiency and avoid adverse impacts on the wholesale market. The results to date show that EMR is a step forwards, not backwards; but it is not the end of the story

Smeared heat-kernel coefficients on the ball and generalized cone

We consider smeared zeta functions and heat-kernel coefficients on the bounded, generalized cone in arbitrary dimensions. The specific case of a ball is analysed in detail and used to restrict the form of the heat-kernel coefficients $A_n$ on smooth manifolds with boundary. Supplemented by conformal transformation techniques, it is used to provide an effective scheme for the calculation of the $A_n$. As an application, the complete $A_{5/2}$ coefficient is given.Comment: 23 pages, JyTe

Fractional-order operators: Boundary problems, heat equations

The first half of this work gives a survey of the fractional Laplacian (and related operators), its restricted Dirichlet realization on a bounded domain, and its nonhomogeneous local boundary conditions, as treated by pseudodifferential methods. The second half takes up the associated heat equation with homogeneous Dirichlet condition. Here we recall recently shown sharp results on interior regularity and on $L_p$-estimates up to the boundary, as well as recent H\"older estimates. This is supplied with new higher regularity estimates in $L_2$-spaces using a technique of Lions and Magenes, and higher $L_p$-regularity estimates (with arbitrarily high H\"older estimates in the time-parameter) based on a general result of Amann. Moreover, it is shown that an improvement to spatial $C^\infty$-regularity at the boundary is not in general possible.Comment: 29 pages, updated version, to appear in a Springer Proceedings in Mathematics and Statistics: "New Perspectives in Mathematical Analysis - Plenary Lectures, ISAAC 2017, Vaxjo Sweden

UK Electricity Market Reform and the Energy Transition: Emerging Lessons

Until 1990, the UK - like many other countries - had an electricity system that was centralised, state-owned, and dominated almost entirely by coal and nuclear power generation. The privatisation of the system that year and its creation of a competitive electricity market attracted global interest, helping to set a path which many have followed. Two decades later, however, the UK government embarked on a radical reform which some critics described as a return to central planning. The UK's Electricity Market Reform (EMR), enacted in 2013, has correspondingly been a topic of intense debate and global interest in the motivations, components, and consequences. This report summarises the evolution of UK electricity policy since 1990 and explains the EMR in context: its origins, rationales, characteristics, and results to date. We explain why the EMR is a consequence of fundamental and growing problems with the form of liberalisation adopted, particularly after 2000, combined with the growing imperative to maintain system security and cut CO2 emissions, whilst delivering affordable electricity prices. The fifteen years after privatisation, coinciding with the era of low fossil fuel prices, had seen mostly falling electricity bills; from about 2004 they started to rise sharply, for multiple reasons including increasing fossil fuel prices, the need for new investment in both generation and transmission, and inefficient renewables policies. The four instruments of the EMR have indeed combined to revolutionise the sector; they have also both drawn on, and helped to spur, a period of unprecedented technological and structural change. Competitive auctions for both firm capacity and renewable energy have seen prices far lower than predicted, with the fixed-price auctions for renewable sources estimated to save over £2bn/yr in the cost of financing the projected renewables investments, compared to the previous support system. A minimum carbon price level has brought cleaner gas to the fore, displacing coal. Electricity prices may have peaked from 2015, with energy efficiency helping to lower overall consumer bills. New forms of generation have expanded rapidly at all scales of the system. Renewable electricity in particular has grown from under 5% of generation in 2010, to almost 25% by 2016, and is projected to reach over 30% by 2020 despite a political de-facto ban on the cheapest bulk renewable, of onshore wind energy. The environmental consequences overall have been dramatic: coal generation has shrunk from about 2/3rd of generation in 1990, to 35% in 2000, to 10% in 2016, halving CO2 emissions from power generation over the quarter century. Neither the technological nor regulatory transitions are complete, and the results to date highlight other challenges. The Capacity Mechanism has proved ill-suited to encouraging demand-side response, and in combination with the growing share of renewables, has underlined problems in transmission pricing. As the share of variable renewables grows further, the associated contracts will require reform to improve siting efficiency and avoid adverse impacts on the wholesale market. The results to date show that EMR is a step forwards, not backwards; but it is not the end of the story

Scattering and self-adjoint extensions of the Aharonov-Bohm hamiltonian

We consider the hamiltonian operator associated with planar sec- tions of infinitely long cylindrical solenoids and with a homogeneous magnetic field in their interior. First, in the Sobolev space $\mathcal H^2$, we characterize all generalized boundary conditions on the solenoid bor- der compatible with quantum mechanics, i.e., the boundary conditions so that the corresponding hamiltonian operators are self-adjoint. Then we study and compare the scattering of the most usual boundary con- ditions, that is, Dirichlet, Neumann and Robin.Comment: 40 pages, 5 figure

Distributing the burdens of climate change

Global climate change raises many questions for environmental political theorists. This article focuses on the question of identifying the agents that should bear the financial burden of preventing dangerous climate change. Identifying in a fair way the agents that should take the lead in climate mitigation and adaptation, as well as the precise burdens that these parties must bear, will be a key aspect of the next generation of global climate policies. After a critical review of a number of rival approaches to burden sharing, the paper argues that only a principled and philosophically robust reconciliation of three approaches to burden sharing (‘contribution to problem’, ‘ability to pay’ and ‘beneficiary pays’) can generate a satisfactory mix of theoretical coherence and practical application

Consumption-oriented policy instruments for fostering greenhouse gas mitigation

Most policy instruments to reduce greenhouse gas (GHG) emissions have focused on producers, and on the energy efficiency of buildings, vehicles and other products. Behavioural changes related to climate change also impact ‘in-use’ emissions, and potentially, emissions both ‘upstream’ (including from imported goods) and ‘downstream’ (eg disposal). Consumption-oriented policies may provide avenues to additional and cost-effective emission reductions, but are less prevalent, in part because of political sensitivities around government efforts to shape individual-level mitigation behaviour. In this paper, we explore policy instruments for encouraging low carbon behaviour in the EU context. Drawing on a literature survey and interviews, as part of the EU Carbon-CAP project, we develop a list of 33 potential instruments, present a systematic methodology for assessing their potential impact and feasibility, and apply this to rank instruments of most interest. Most instruments involve a clear trade-off between their potential impact and feasibility; about half feature in the top three scoring categories, many being voluntary approaches, which may be easier to implement, but with limited or highly uncertain impact. However, we identify a handful of top-scoring instruments that deserve far more policy attention. The complexity of consumer and corporate motivations and behaviours suggests that instruments should be trialled and monitored (e.g. in regions / individual States) before widespread introduction. Most would also be most effective when nested within wider policy packages, to address the varied behavioural motivations and stages of supply chains