On the price and volume effects from green certificates in the energy market
MetadataShow full item record
- Discussion Papers 
Abstract: We present a model for an energy market that includes a green certificate for suppliers of energy from renewables and a purchaser commitment to buy these certificates. We show that price and volume effects in the energy market are ambigous under a wide range of alternative levels of the purchaser commitment. We calibrate our model to data for the Norwegian economy. Simulations shows a downward movement in energy prices as the government starts increasing the level of the purchaser commitment. This implies that the producer of ordinary energy pays for the restriction in the market while energy consumption and consumer surplus increases. When the purchaser commitment increases above a certain level, the purchaser price increases and the volume effect is negative. Although the effects are sensitive to elasticities of demand and supply of both technologies, the main results are robust against a variety of combinations of elasticities. The article discusses effects both under autarky and free trade of both energy and green certificates. The results vary denpendent upon whether only one or a majority of actual countires introduces a domestic market or allows for international trade both in energy and the green certificate instrument. Keywords: Green certificates, energy market model, new instruments
PublisherStatistics Norway, Research Department
SeriesDiscussion Papers;No. 351
Showing items related by title, author, creator and subject.
Markets where buyers also are sellers : how realized home equity may work as an accelerator of house prices Larsen, Erling Røed (Discussion Papers;No. 618, Working paper, 2010)Abstract: The house price level is a function of buyers’ realized home equity, and buyers’ realized home equity is a function of the house price level. This interdependence follows from the fact that buyers are sellers ...
Bye, Brita (Discussion Papers;No. 242, Working paper, 1998)The working of the labour market is important for the total welfare effects of tax reforms. This paper analyses, by using a computable general equilibrium model for the Norwegian economy, how different assumptions about ...
Removing policy based comparative advantage for energy intensive production. Necessary adjustments of the real exchange rate and industry structure Bye, Torstein; Holmøy, Erling; Heide, Kim Massey (Discussion Papers;No. 462, Working paper, 2006)Abstract: National and international expansion of transmission networks and diminishing returns to scale in hydropower capacity expansion has raised the opportunity cost of electricity. The resulting changes in comparative ...