A plant-level analysis of the spill-over effects of the German Energiewende

In order to analyse international effects of national energy policies, we investigate the spill-over effects of the German Energiewende on the Dutch power market, which is closely connected to the German market. We estimate the impact of the German supply of wind and solar electricity on the Dutch day-ahead price of electricity and the utilisation of the conventional power plants. We take cross-border capacity constraints into account and use hourly plant-level data over 2006–2014. We find that the price elasticity of German wind on Dutch day-ahead prices is −0.03. However, this effect vanishes when the cross-border capacity is fully utilised. We find a modest negative impact on the utilisation of the Dutch power plants. As such, we conclude that the German Energiewende has had modest spill-over effects to the Dutch market. The recent dramatic performance of the Dutch gas-fired plants can be attributed to the changes in the relative prices of coal versus natural gas. We conclude that national energy policies in one country do not necessarily strongly affect neighbouring markets in case of constrained cross-border capacities.PostprintPeer reviewe

Verkenning MKBA werkwijzer Energie

Resultaten Er moet een werkwijzer komen voor maatschappelijke kosten-batenanalyses (MKBA’s) van energiebeleid. Belangrijke aspecten zijn het aanpassingsvermogen van energiemarkten, de flexibiliteit van de energievoorziening, kosten van stroomuitval en betaalbaarheid van energie. Het onderzoek In 2013 is de Algemene leidraad voor maatschappelijke kosten-batenanalyse (MKBA) vastgesteld door het kabinet. Hierna volgden werkwijzers voor het sociale domein, milieu en natuur. Het ministerie van Economische Zaken en Klimaat (EZK) heeft SEO en de Rijksuniversiteit Groningen gevraagd om na te gaan of een werkwijzer voor MKBA van energiebeleid nuttig is, en welke onderwerpen daarin moeten worden behandeld. Gebruikte methode De kosten en baten van energiebeleid worden beschreven aan de hand van doelen van het beleid: voorzieningszekerheid, leveringszekerheid, vermindering van milieueffecten en betaalbaarheid. Daarnaast wordt aandacht besteed aan effecten van beleid op de flexibiliteit van de energievoorziening. Bij elk onderdeel wordt op hoofdlijnen aangegeven hoe een MKBA-werkwijzer daar aandacht aan kan besteden

Distributed energy generation techniques and the competitive fringe effect in electricity markets

We analyse the impact of two different generation techniques used by fringe suppliers on the intensity of competition in the electricity wholesale market. For that purpose we derive a Cournot model of this market taking into account long-term contracts, international trade and fringe suppliers using different energy generating technologies. We apply this model to the Dutch market and estimate the impact of fringe supply on the Lerner index. We find that the fringe supply coming from both intermittent wind generation and combined heat and power (CHP) plants operated by horticultural farmers increases competition, which leads to lower prices in the electricity market. However, this impact is relatively small. The effect per unit of intermittent wind electricity generation on competition and, therefore, prices is stronger than that of the CHP technology.PostprintPeer reviewe

An efficiency perspective on carbon emissions and financial performance

International policy actions to constrain carbon emissions create substantial risks and opportunities for firms. In particular, production processes that are relatively high emitting will be more sensitive to uncertain costs of emitting carbon dioxide and might further reflect productive inefficiencies. We employ a productive efficiency model to evaluate firms’ carbon emission levels relative to those of best practice (efficient) peers with comparable production structures. By accounting for total factor productivity and sector-relative performance aspects, this measure of carbon efficiency helps to quantify and rank firms’ relative dependency on carbon in the production process. We investigate the impact of carbon efficiency on various financial performance outcomes, and evaluate the role of general resource efficiency in explaining these impacts. Using an international sample of 1,572 firms over the years 2008-2016, we find superior financial performance in carbon efficient (best-practice) firms. On average, a 0.1 higher carbon efficiency is associated with a 1.0% higher profitability and 0.6% lower systematic risk. While carbon efficiency closely relates to resource efficiency, it also has distinct financial performance impacts, particularly lowering systematic risk. Overall, our findings suggest that carbon efficient production can be valuable from both operational and risk management perspectives.Publisher PDFPeer reviewe

External carbon costs and internal carbon pricing

The use of internal carbon prices (ICPs) is a practice by which companies voluntarily attach a hypothetical cost to their carbon emissions to help prioritize low-carbon investment projects. We find that ICP use is driven by external carbon constraints and by firms' exposure to formal carbon pricing systems, next to various firm and society characteristics. The size of the gap between countries' actual and intended emissions alone, without a translation into stringent climate policies, does not play a role. These findings inform policymakers and investors about when and why firms account for future carbon constraints internally. A key societal risk is that corporate investments are not sufficiently directed at a future low-carbon economy. Stringent climate policies that provide predictable pathways appear to help firms mitigate the misalignment of their investments by using ICPs and thereby contribute to a less erratic and less expensive transition of the energy system.Publisher PDFPeer reviewe

Do market failures hamper the perspectives of broadband?

This report analyses the broadband market and asks whether a specific role of government is necessary. As broadband telecommunication is seen as a source of productivity gains, the European Union and other regions are encouraging the deployment of a secure broadband infrastructure. In the Netherlands, there is some concern whether the supply of broadband capacity will meet the strongly increasing demand. The main conclusions are that presently, given current broadband policy, no considerable market failures exist. Firms have adequate incentives to invest in broadband, partly induced by specific regulation of access to the local copper loop. Hence, there is no need for changes in current broadband policy. Market failures in terms of knowledge spillovers are taken care of by other policies. As the broadband markets are very dynamic, unforeseen developments may emerge such as the appearance of new dominant techniques and market players. The best strategy for the government, in particular the competition authority, is to continuously monitor these markets, making timely intervention easier when needed.