Dynamic Competition and Arbitrage in Electricity Markets: The Role of Financial Players

Market power is typically an important concern in restructured electricity markets. This paper shows that financial traders, who trade alongside physical buyers and sellers, can increase competitiveness and lead to lower consumer prices by effectively competing with generators and restricting their market power.

Energy Efficiency, Information, and the Acceptability of Rent Increases

In this paper, the authors explore role of imperfect information and attentional biases in the context of energy efficiency investments by quantifying how alternative informational interventions affect tenants' acceptance of rent increases in exchange for improved energy efficiency of their heating appliance.

Does the U.S. Export Global Warming? Coal Trade and the Shale Gas Boom

Christopher Knittel, Konstantinos Metaxoglou, Anson Soderbery and Andre Trindade examine the effect of the US Shale Gas Boom on global trade, consumption of coal, and CO2 emissions and the results show that the total quantity of coal traded around in the absence of the Boom is essentially the same as the actual...

Fair, Equitable, and Efficient Tariffs in the Presence of DERs

In a new CEEPR Working Paper, the authors delineate various aspects of equity and fairness that regulators must grapple with when designing electricity tariffs and show that more economically efficient tariffs can improve several aspects of equity. The research argues that DER adoption under existing tariff schemes may increase inequities already present in the power system.

Coordinating Separate Markets for Externalities

In a new CEEPR Working Paper, the authors show that inefficiencies from having separate markets to correct an environmental externality are significantly mitigated when firms participate in an integrated product market, using data from an integrated wholesale electricity market.

Who Closes First? Ownership and Collusive Early Exits

Climate and energy policies lead to a declining market for the incumbent technologies in electricity markets. Facing the challenge of closures, incumbent firms have incentives to coordinate closures through cross-ownership to achieve a collusive phase-out. For the Nordic nuclear industry, a quantification shows a highly distorted phase-out, both for the consumer surplus and the environment.

In The News

Oct 29, 2018

Carbon Capture is Messy and Fraught - But Might Be Essential

Who would pay for a company to sequester carbon underground? MIT economist Christopher Knittel discusses a potential solution in a Wired article here.

Oct 9, 2018

Carbon tax debate: Nobels and IPCC vs. Trump and Doug Ford

In an article in Grist, Professor Christopher Knittel comments on the carbon tax debate. Read the full article here.

Sep 6, 2018

MIT Energy Initiative study reports on the future of nuclear energy

In "The Future of Nuclear Energy in a Carbon-Constrained World," released by the MIT Energy Initiative on Sept. 3, the authors analyze the reasons for the current global stall of nuclear energy...

Jun 4, 2018

Measuring Savings from Fault Detection and Diagnostics

Data analytics will play a major role in advancing global energy efficiency and high performance building goals nationally and globally. As the fault detection and diagnostics industry emerges and...

May 9, 2018

We don’t know what climate change will cost — that doesn’t mean we can ignore it

Professor Robert S. Pindyck of MIT and Professor James H. Stock of Harvard University discuss the importance of the social cost of carbon in a new piece on TheHill.

May 1, 2018

Electricity Market Design with Renewables

A new paper compares EU and US electricity market designs, arguing for a focus on correct price formation in the short-term to incentivize investments and reliability. Increased demand-side...

Mar 20, 2018

Restructuring Revisited: Competition and Coordination in Electricity Distribution Systems

In light of the decentralization of the power sector, a new CEEPR Working Paper carefully considers how industry structure regulations impacts competition, market development, and the efficiency of...

Mar 7, 2018

Power Sector Reform and Corruption: Evidence from Sub-Saharan Africa

In this paper, the authors conduct an econometric analysis of the performance of reforms in terms of efficiency, welfare, and economic development in 47 countries in Sub-Saharan Africa between 2002...

Feb 21, 2018

3 Questions: The Future of Nuclear Energy

Jacopo Buongiorno and John Parsons, co-directors of the MITEI LCEC for Advanced Nuclear Energy Systems, discuss how to overcome the challenges and realize the benefits of expanding nuclear power.

Feb 2, 2018

3 Questions: Transforming our Electric Power System

Christopher Knittel and Francis O'Sullivan, co-directors of the MITEI LCEC for Electric Power Systems Research, are exploring cleaner, more reliable, and more cost-effective solutions.

Feb 7, 2018

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

In 2013, the UK introduced radical market reform to meet the new challenges - a change which some critics denounced as a return to central planning, whilst others feared the costs. The results to...

Jan 29, 2018

Subsidizing Fuel Efficient Cars: Evidence from China's Automobile Industry

In a new CEEPR Working Paper, the authors examine the response of vehicle purchase behavior to China’s largest national subsidy program for fuel efficient vehicles during 2010 and 2011.

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