does working from home work evidence from a chinese experiment about 10 of us employees now regularly work from home wfh but there are concerns this can lead to shirking from home we report the results of a wfh experiment at ctrip a 16 000 employee nasdaq listed chinese travel agency call center employees who volunteered to wfh were randomly assigned to work from home or in the office for 9 months home working led to a 13 performance increase of which about 9 was from working more minutes per shift fewer breaks and sick days and 4 from more calls per minute attributed to a quieter working environment home workers also reported improved work satisfaction and experienced less turnover but their promotion rate conditional on performance fell due to the success of the experiment ctrip rolled out the option to wfh to the whole firm and allowed the experimental employees to re select between the home or office interestingly over half of them switched which led to the gains from wfh almost doubling to 22 this highlights the benefits of learning and selection effects when adopting modern management practices like wfh

the electricity generation adequacy problem assessing dynamic effects of capacity remuneration mechanisms abstract following liberalization reforms the ability of power markets to provide satisfactory incentives for capacity investments has become a major concern in particular current energy markets can exhibit a phenomenon of investment cycles which generate phases of under and over capacity and hence additional costs and risks for generation adequacy to cope with these issues new mechanisms called capacity remuneration mechanisms crm have been or will be implemented this paper assesses the dynamic effects of two crms the capacity market and the strategic reserve mechanism and studies to what extent they can reduce the investment cycles generation costs and shortage costs of both mechanisms are also compared to conclude on their effectivity and economic efficiency a simulation model based on system dynamics is developed to study the functioning of both crms and the related investment decisions the results highlight the benefits of deploying crms to solve the adequacy issue shortages are strongly reduced compared to an energy only market besides the capacity market appears to be more beneficial since it experiences fewer shortages and generation costs are lower these comparisons can be used by policy makers in particular in europe where these two crms are mainly debated to determine which crm to adopt

optimal investments in power generation under centralized and decentralized decision making this work presents a novel model for optimization of investments in new power generation under uncertainty the model can calculate optimal investment strategies under both centralized social welfare and decentralized profit objectives the power market is represented with linear supply and demand curves a stochastic dynamic programming algorithm is used to solve the investment problem where uncertainty in demand is represented as a discrete markov chain the stochastic dynamic model allows us to evaluate investment projects in new base and peak load power generation as real options and determine optimal timing of the investments in a case study we use the model to compare optimal investment strategies under centralized and decentralized decision making a number of interesting results follow by varying the assumptions about market structure and price response on the demand side

country specific oil supply shocks and the global economy a counterfactual analysis abstract this paper investigates the global macroeconomic consequences of country specific oil supply shocks our contribution is both theoretical and empirical on the theoretical side we develop a model for the global oil market and integrate this within a compact quarterly model of the global economy to illustrate how our multi country approach to modeling oil markets can be used to identify country specific oil supply shocks on the empirical side estimating the gvar oil model for 27 countries regions over the period 1979q2 to 2013q1 we show that the global economic implications of oil supply shocks due to for instance sanctions wars or natural disasters vary considerably depending on which country is subject to the shock in particular we find that adverse shocks to iranian oil output are neutralized in terms of their effects on the global economy real outputs and financial markets mainly due to an increase in saudi arabian oil production in contrast a negative shock to oil supply in saudi arabia leads to an immediate and permanent increase in oil prices given that the loss in saudi arabian production is not compensated for by the other oil producers as a result a saudi arabian oil supply shock has significant adverse effects for the global economy with real gdp falling in both advanced and emerging economies and large losses in real equity prices worldwide

auction approaches of long term contracts to ensure generation investment in electricity markets lessons from the brazilian and chilean experiences the implementation of auctions of long term electricity contracts is arising as an alternative to ensure generation investment and therefore achieve a reliable electricity supply the aim is to reconcile generation adequacy with efficient energy purchase correct risk allocation among investors and consumers and the politico economic environment of the country in this paper a generic proposal for a long term electricity contracts approach is made including practical design concepts for implementation this proposal is empirically derived from the auctions implemented in brazil and chile during the last 6 years the study is focused on practices and lessons which are especially useful for regulators and policy makers that want to facilitate the financing of new desirable power plants in risky environments and also efficiently allocate supply contracts among investors at competitive prices although this mechanism is generally seen as a significant improvement in market regulation there are questions and concerns on auction performance that require careful design and which are identified in this paper in addition the experiences and proposal described can serve to derive further mechanisms in order to promote the entrance of particular generation technologies e g renewables in the developed world and therefore achieve a clean electricity supply

optimal pricing in electrical networks over space and time an electrical system is modelled with a transmission network customers central generators and independent generators the system is subject to stochastic failures and stochastic demand parameters optimal spot prices are derived for the system they vary stochastically with space and time and depend on electrical load flow patterns the price difference between two locations or two voltage levels and the wheeling charge between them will change magnitude and sometimes sign over time as a function of events throughout the network current spatial pricing methods are significantly different from the spot price based methods derived here

social cost efficient service quality integrating customer valuation in incentive regulation evidence from the case of norway in order to overcome the perverse incentives of excessive maintenance reductions and insufficient network investments arising with incentive regulation of electricity distribution companies regulators throughout europe have started regulating service quality in this paper we explore the impact of incorporating customers willingness to pay for service quality in benchmarking models on cost efficiency of distribution networks therefore we examine the case of norway which features this approach to service quality regulation we use the data envelopment analysis technique to analyse the effectiveness of such regulatory instruments moreover we discuss the extent to which this indirect regulatory instrument motivates a socially desired service quality level the results indicate that internalising external or social cost of service quality does not seem to have played an important role in improving cost efficiency in norwegian distribution utilities

the costs of electricity interruptions in spain are we sending the right signals one of the objectives of energy security is the uninterrupted physical availability of energy however there is limited information about how much is the cost of energy supply interruptions this information is essential to optimize investment and operating decisions to prevent energy shortages or alternatively to determine the strength of the signals to be sent to the agents so that they may invest accordingly in this paper we estimate the economic impact of an electricity interruption in different sectors and regions of spain although there are several caveats in our analysis we find that in 2008 the cost for the spanish economy of one kwh of electricity not supplied was above 4 even in a conservative scenario which is higher than the signals currently being sent as incentives to avoid these interruptions this might result in an underinvestment in short term energy security particularly when we add the usual risk aversion of most consumers

security of electricity supply at the generation level problem analysis abstract since the very beginning of the restructuring process back in 1982 in chile the ability of an electricity market to provide the system with the required level of security of supply has been put into question the mistrust on the ability of the market left to its own devices to provide sufficient generation availability when needed is more and more leading to the implementation of additional regulatory mechanisms this matter is undoubtedly gaining importance and it has taken a key role in the energy regulators agendas in this paper we revisit this discussion under the light of thirty years of electricity market experience we analyze the different reasons why although ideally the market is supposed to provide itself an adequate security of supply at the generation level this result is still far from being achieved in practice

a geographically resolved method to estimate levelized power plant costs with environmental externalities in this analysis we developed and applied a geographically resolved method to calculate the levelized cost of electricity lcoe of new power plants on a county by county basis while including estimates of some environmental externalities we calculated the lcoe for each county of the contiguous united states for 12 power plant technologies the minimum lcoe option for each county varies based on local conditions capital and fuel costs environmental externalities and resource availability we considered ten scenarios that vary input assumptions we present the results in a map format to facilitate comparisons by fuel technology and location for our reference analysis which includes a cost of 62 tco2 for co2 emissions natural gas combined cycle wind and nuclear are most often the lowest lcoe option while the average cost increases when internalizing the environmental externalities carbon and air pollutants is small for some technologies the local cost differences are as high as 0 62 kwh for coal under our reference analysis these results display format and online tools could serve as an educational tool for stakeholders when considering which technologies might or might not be a good fit for a given locality subject to system integration considerations

regulatory design for res e support mechanisms learning curves market structure and burden sharing drawing from relevant experiences in power systems around the world this paper offers a review of existing policy support mechanisms for res e with a detailed analysis of their regulatory implications while recent studies provide an account of current res e support systems in this paper we focus on some of the impacts these mechanisms have on the overall energy market structure and its performance given the rising importance of res e in systems everywhere these impacts should no longer be overlooked

assessing the impacts of capacity mechanisms on generation adequacy with dynamic simulations there have been many debates over whether the energy only electricity market will be able to provide a reasonable investment signal so far many diverse designs of capacity mechanisms have been proposed in relation to the adequacy problem researchers have conducted many qualitative studies of capacity mechanisms but quantitative studies have largely been ignored the framework for examining the impacts of market designs on generation adequacy considering various generation technologies have not been maturely developed this paper focuses on developing this framework and finding out how effective capacity mechanisms are in different market conditions to cover investment under uncertainty we will introduce different utility functions representing risk attitudes and apply the expected utility theory to the investment decision finally we will examine the investment decision sensitivity of the risk components such as the risk attitude the error of forecast peak load and the forced outage rate and evaluate the performance of three market designs with dynamic simulations an energy only market a capacity payment model and a capacity demand curve model

a dynamic analysis of a demand curve based capacity market proposal the pjm reliability pricing model because of high generation adequacy standards in the power industry some peaking capacity operates for a limited time during the year and may not receive sufficient energy revenues to meet its fixed costs this is particularly true when energy prices are capped in order to mitigate market power the northeastern u s independent system operators isos have responded to this issue by establishing capacity obligations for loads and markets for installed capacity thus providing a capacity revenue stream to generators the installed capacity icap markets in the northeastern u s markets are a response to this need for additional incentives to construct generation the federal energy regulatory commission ferc has accepted the pjm interconnection s pjm proposal to replace the present fixed icap requirement that is placed upon load serving entities lses with a demand curve based system in which the iso would be responsible for acquiring residual capacity on behalf of lses the demand curve approach pays more when reserve margins are smaller and provides a reduced incentive for investment when installed reserves are above the target another goal is to make revenues more predictable for generators making investment less costly and ultimately lowering prices for consumers a dynamic representative agent model is presented for projecting effects upon reserve margins generator profitability and consumer costs and is applied to alternative demand curves proposed for the pjm market the consumer costs resulting from a sloped demand curve are robustly lower compared to the present fixed requirement under a wide range of assumptions concerning behavior of generation owners including risk attitudes bidding behavior and willingness to build capacity as a function of forecast profit the cost savings arise from lower capital costs to generators due to reduced risk and risk premiums also average installed capacity is less for the same level of reliability because of reduced fluctuations in installed reserves

investment with incomplete markets for risk the need for long term contracts abstract barring subsidies investment in the power generation sector has come to an almost complete halt in the restructured european power sector market and regulatory failures such as the well known missing money see joskow 2006 but also normal market features such as risk possibly also affected by market failures like market incompleteness are mentioned as common causes for the situation this paper discusses incomplete risk trading and its impact on investment the analysis applies computable stochastic equilibrium models on a simple market model of the energy only type the paper first compares the cases of complete and fully incomplete markets full risk trading and no risk trading it continues by testing the impact of different risk trading contracts on both welfare and investment we successively consider contracts for difference reliability options with and without physical back up that we add to our energy only market model we test the impact of market liquidity on the results finally we compare these methods to a forward capacity market that we also add to the energy only model we complete the paper by interpretation of these results in terms of hurdle rate implied by these risk trading situations

evaluating renewable energy based rural electrification program in western china emerging problems and possible scenarios renewable energy technologies offer an economically viable and environmentally suitable scenario towards addressing energy requirements for rural livelihoods china s renewable energy rural electrification program initiated in 2001 is an effort to employ renewable energy technologies on a large scale for rural electrification the program has been designed with several stages this paper firstly offers an analysis of the problems encountered during the progress of this rural electrification program using data obtained from field survey of representative areas in western china where the first stage of the program was implemented the paper then explores feasible solutions in order to address existing rural energy issues and provide long term reliable energy service for remote communities in support of future course of development of renewable energy application for rural energy demands policy recommendations are provided

causality relationship between electricity consumption and gdp in bangladesh in this paper we examine the causal relationship between the per capita electricity consumption and the per capita gdp for bangladesh using cointegration and vector error correction model our results show that there is unidirectional causality from per capita gdp to per capita electricity consumption however the per capita electricity consumption does not cause per capita gdp in case of bangladesh the finding has significant implications from the point of view of energy conservation emission reduction and economic development

integrating real options analysis with long term electricity market models abstract in liberalized electricity markets the investment postponement option is deemed decisive for understanding the addition of new generating capacity basically it refers to the possibility for investors to postpone projects for a period while waiting for the arrival of new and better information about the market evolution when such development involves major uncertainties the generation business becomes riskier and the investors wait and see behavior might limit the timely addition of new power plants in that sense the literature provides solid empirical evidence about the occurrence of construction cycles in the deregulated electricity industry however the strategic flexibility inherent to the option to defer new power plants has not yet been rigorously incorporated to investment signals in existing market models therefore this paper proposes a novel methodology to assess the long term development of liberalized power markets based on a more realistic approach for valuing generation investments the work is based on a stochastic dynamic market model built upon system dynamics simulation approach the decision making framework considers that the addition of new capacity is driven by the economic value of the strategic flexibility associated with deferring investments under uncertainties thus the value of the postponement option is quantified in monetary terms through real options analysis simulations confirm the cyclical behavior of the energy only market in the long run as suggested by the empirical evidence found in the literature in addition sensitivity analysis regarding some relevant exogenous variables depicts an even more fluctuating evolution of the capacity due to the combination of strong demand growth rates with large volatilities finally the model validity is assessed through a formal procedure according to the scope of system dynamics modeling approach

electricity auctions in south america towards convergence of system adequacy and res e support regulatory reforms of the electricity industry in south america have always been prompted by the need of attracting enough investment to cover the fast paced demand growth in order to achieve this goal the countries in the region which in the eighties and early nineties opted for market oriented schemes have rebuilt in the last decade their regulatory frameworks around long term auctioning these new mechanisms initially implemented to attract investment in any sort of conventional generation technology so as to ensure the system adequacy are increasingly being also used to bring in non conventional renewable energy resources these schemes have been until now run in parallel but the steep learning curve of renewable energy sources for electricity res e technologies is apparently opening the door to the implementation of new tendering procedures open to all kinds of generation technologies in this article we review the auction mechanisms for new generation implemented in south america we argue that although the first impression might lead to the conclusion that conventional and res e technologies are in some cases close and even ostensibly competing in the same auctions the fact is that the full convergence is still far to happen as the rules and products applied to the different technologies differ significantly

rationales for capacity remuneration mechanisms security of supply externalities and asymmetric investment incentives economics so far provides little conceptual guidance on capacity remuneration mechanisms crm in deregulated electricity markets ubiquitous in real world electricity markets crms are introduced country by country in an ad hoc manner lacking the theoretical legitimacy and the conceptual coherence enabling comparability and coordination they are eyed with suspicion by a profession wedded to a theoretical benchmark model that argues that competitive energy only markets with voll pricing provide adequate levels of capacity while the benchmark model is a consistent starting point for discussions about electricity market design it ignores the two market failures that make crms the practically appropriate and theoretically justified policy response to capacity issues first energy only markets fail to internalize security of supply externalities as involuntary curbs on demand under scarcity pricing generate social costs beyond the private non consumption of electricity second when demand is inelastic and the potential capacity additions are discretely sized investors face asymmetric incentives and will underinvest at the margin rather than overinvest after presenting the key features of the theoretical benchmark model this paper conceptualizes security of supply externalities and asymmetric investment incentives and concludes with some consideration regarding design of crms

happiness and productivity some firms say they care about the well being and happiness of their employees but are such claims hype or scientific good sense we provide evidence for a classic piece rate setting that happ

evaluating the regulator winners and losers in the regulation of spanish electricity distribution abstract the principal aim of this study is to evaluate the regulation of electricity distribution in spain to this end we begin by analyzing whether the changes introduced by the regulator led distribution companies to improve their efficiency we then address whether the reimbursements paid to the distribution companies are linked to efficiency lastly we examine whether consumers benefited from the efficiency improvements we focus on spain because the electricity regulator in that country is a longstanding pioneer in the implementation of incentive based regulatory models our analysis was implemented using the regulatory model proposed by bogetoft 1997 as a benchmark the results show that the spanish electricity regulator did not establish a link between efficiency and the reimbursements paid to electricity companies in addition the electricity companies benefited to the detriment of consumers

a methodology for understanding the impacts of large scale penetration of micro combined heat and power co generation at small kw e scale has been stimulated in recent years by governments and energy regulators as one way to increasing energy efficiency and reducing co2emissions if a widespread adoption should be realized their effects from a system s point of view are crucial to understand the contributions of this technology based on a methodology that uses long term capacity planning expansion this paper explores some of the implications for an electric power system of having a large number of micro chps results show that fuel cells based micro chps have the best and most consistent performance for different residential demands from the customer and system s perspectives as the penetration increases at important levels gas based technologies particularly combined cycle units are displaced in capacity and production which impacts the operation of the electric system during summer peak hours other results suggest that the tariff design impacts the economic efficiency of the system and the operation of micro chps under a price based strategy finally policies aimed at micro chps should consider the suitability of the technology in size and heat to power ratio to meet individual demands the operational complexities of a large penetration and the adequacy of the economic signals to incentivize an efficient and sustainable operation more highlights capacity displacements and daily operation of an electric power system are explored benefits depend on energy mix prices and micro chp technology and control scheme benefits are observed mostly in winter when micro chp heat and power are fully used micro chps mostly displace installed capacity from natural gas combined cycle units and tariff design impacts economic efficiency of the system and operation of micro chps less

enhanced operational reserve as a tool for development of optimal energy mix abstract the aim of this article is to present a novel capacity remuneration mechanism concept that differentiates the level of financial support according to the technology and parameters of the new power plants new power plants that are to be constructed should guarantee the highest level of security of electricity supply and be consistent with actual energy policy carried out by a country thus the proposed remuneration system is based on an operational reserve system which is currently implemented in poland the proposed system distinguishes new power generating assets according to a total assessment based on three factors type of technology including emission benchmark flexibility and location addressing issue of brown or green field investment and conditions of power system operation existing power plants are also subsidized by the proposed mechanism however their remuneration is not based on their characteristics the details of the proposed mechanism a cost analysis and a standardized evaluation procedure are described in the paper the concept itself is universal and can be intruded in every power system that must overcome capacity problem

a method for estimating security of electricity supply from intermittent sources scenarios for germany until 20301 abstract in this paper we develop a methodology for deriving a consistent measure for supply adequacy in the power generation sector we especially consider the secured generation capacity of intermittent renewable energy sources such as wind availability of conventional power plants is estimated through stochastic convolution of unscheduled non usabilities we employ our methodology to measure supply security in germany until 2030 a detailed market analysis of power plants that are currently being built or planned provides support to our analysis for the short term for the long term we rely on a large scale dispatch and investment model of the european power sector to account for the embedding of the german electricity sector in the european market we analyze two scenarios one with prolongation of nuclear power plants and one with a nuclear phase out our results show that even though intermittent renewables only provide very limited secured generation capacity security of electricity supply in germany can be assured until 2015 in the long term the need for backup capacity for renewable energy sources increases as well as the need for electricity imports

retrospectives edgeworth s hedonimeter and the quest to measure utility in this article i discuss some earlier debates about the foundations of utility and its measurement focusing on the contributions of francis y edgeworth 1845 1926 a famous british economist who was a leader in the development of a more mathematically structured economics in the late 1800s and irving fisher 1867 1947 one of the first quantitative u s economists best known today for his work on the quantity theory and interest rate theory edgeworth argued that utility was directly measurable and that new developments in physio psychology would make it possible to develop a hedonimeter that would allow economists to develop a firm physiological underpinning of utility fisher while agreeing with edgeworth that it was important to have a workable measure of utility disagreed with edgeworth about the possibility of doing so with a hedonimeter and hence of having any physiological underpinnings of utility he argued that instead of searching for physiological underpinnings of utility economists should instead rely upon backward induction from observed behavior to measured utility neither of these views about the possibility of utility measurement carried through and attempts to measure utility were abandoned in the 1930s when utility measurement and happiness considerations were determined to be outside the purview of economics both edgeworth and fisher knew that their approaches to utility measurement opened up a pandora s box of problems they opened that box nonetheless because they felt that theoretical economics had to be relevant to policy and to be relevant it had to face the problems

historical construction costs of global nuclear power reactors the existing literature on the construction costs of nuclear power reactors has focused almost exclusively on trends in construction costs in only two countries the united states and france and during two decades the 1970s and 1980s these analyses koomey and hultman 2007 grubler 2010 and escobar rangel and leveque 2015 study only 26 of reactors built globally between 1960 and 2010 providing an incomplete picture of the economic evolution of nuclear power construction this study curates historical reactor specific overnight construction cost occ data that broaden the scope of study substantially covering the full cost history for 349 reactors in the us france canada west germany japan india and south korea encompassing 58 of all reactors built globally we find that trends in costs have varied significantly in magnitude and in structure by era country and experience in contrast to the rapid cost escalation that characterized nuclear construction in the united states we find evidence of much milder cost escalation in many countries including absolute cost declines in some countries and specific eras our new findings suggest that there is no inherent cost escalation trend associated with nuclear technology

short term resource adequacy in electricity market design short term resource adequacy is the ability of a system with a set of given resources to meet the load over the short term in the aftermath of the 2000 2001 california crisis the consideration of resource adequacy in market design became critically important various capacity approaches such as requirements payments and subscriptions have been proposed to ensure resource adequacy in electricity markets we focus on short term resource adequacy design and analysis within the context of making effective use of competition in electricity markets we propose a design of a short term resource adequacy program based on capacity requirements expressed in terms of a price sensitive demand curve the program gives incentives for providing capacity to markets and metes out penalties for nonperformance situations the probabilistic modeling of the uncertainty in the generation availability and in the load allows the evaluation of reliability in terms of widely used metrics the analysis of the proposed design and the simulation of a simple implementation on different sized test systems show that the program results in improved reliability these studies indicate that the total system costs may be minimized when key program parameters are appropriately chosen the proposed design provides a meaningful linkage between reliability and markets and constitutes a contribution to the electricity market design

a framework to evaluate security of supply in the electricity sector security of electricity supply soes has become a major concern for regulators and policymakers over the last decade however most work focusses either more generally on energy security or on a single fuel we develop a comprehensive but flexible framework to assess the soes for a single jurisdiction taking into the account the specificities of electricity this framework has two aims i provide a snapshot of the situation to understand current weaknesses and determine what actions are required ii capture the evolution over time to evaluate progress and identify potential problems before they materialise the framework based on an extensive literature review consists of twelve dimensions that are critical for soes we develop metrics that capture the state and evolution of each dimension this framework is intended to be a management information tool for all stakeholders aimed at organising data and structuring its analysis to enable monitoring the evolution of the soes while also functioning as an early warning system by flagging potential future problems

towards a comprehensive policy for electricity from renewable energy an approach for policy design abstract energy policy design in europe is a complex issue involving multiple levels of governance and heavily influenced by institutional contexts however policy design in europe and model based analysis even more so is arguably shaped by the neo classical school of thought there is a need to provide a structured approach that would facilitate the incorporating of institutional contexts into renewable energy sources for electricity res e policy design and analysis this paper presents a formal approach to res e policy design based on design theory the institutional analysis and development iad framework and agent based modelling and simulation given a certain frame of analysis we propose that it is theoretically possible to identify the complete policy design space a set of design elements crucially this aspect potentially opens up to the policy analyst new avenues for intervention and allows her systematically explore given a range of uncertainties which element s of intervention is are the most vital to achieve the goals of the community its empirical applicability is demonstrated by representing and differentiating between six res e schemes from western europe in terms of the design elements a model based illustration demonstrates the value of this approach to quantitatively analyse the impact of design elements

the impact of investors risk aversion on the performances of capacity remuneration mechanisms abstract this paper analyses the impact of risk aversion on the performances of capacity remuneration mechanisms with investors facing an uncertain peak load three market designs are studied for this purpose a competitive energy only market a capacity market and a strategic reserve mechanism a simulation model based on system dynamics is developed in order to represent investment decisions and analyse the behaviour of each market design risk aversion is modelled through the computation of conditional value at risk the results are discussed in terms of impact on the reliability ability to limit shortages and cost total generation costs of the studied market designs when comparing the three market designs the capacity market seems to be the least affected by the introduction of risk aversion both in terms of cost and reliability this result suggests that implementing a capacity market is preferable in order to deal with the adverse effects of risk aversion given the simulations and parameters that were used

pricing reliability options under different electricity price regimes abstract reliability options are capacity remuneration mechanisms aimed at enhancing security of supply in electricity systems they can be framed as call options on electricity sold by power producers to system operators this paper provides a comprehensive mathematical treatment of reliability options their value is first derived by means of closed form pricing formulae which are obtained under several assumptions about the dynamics of electricity prices and strike prices then the value of the reliability option is simulated under a real market calibration using data of the italian power market we perform sensitivity analyses to highlight the role of the level and volatility of both power and strike price of the mean reversion speeds and of the correlation coefficient on the reliability options value finally we calculate the parameter model risk to quantify the impact that a model misspecification has on the equilibrium value of the ro

tales of two islands lessons for eu energy policy from electricity market reforms in britain and ireland abstract britain considers the energy only eu target electricity model tem wanting in delivering the trilemma of reliability sustainability and affordability and argues that a capacity auction with long term contracts for new entrants is the least cost solution compared to relying on expectations of future prices to deliver adequate generation and demand side response the energy union argues against feed in tariffs fits for renewables pressing for premium fits pfits just as gb has abandoned pfits in favour of fits this paper draws on the gb experience of electricity market reform before and after the 2015 change of government to highlight promising resolutions of the energy trilemma and the problems that have arisen between the diagnosis of the problem and the delivery of solutions it sets out the theory and practice of delivering capacity energy and quality of supply gives a brief history of gb electricity from the cegb to its current unbundled liberalized and privatized structure that sheds light on the trilemma problem and discusses possible solutions the island of ireland single electricity market reforms illustrate the problem and possible answer of how best to deliver quality of service with high intermittency

a market approach to long term security of supply the problem of ensuring that there is enough generation capacity to meet future demand has been an issue in market design since the beginning of the deregulation process although ideally the market itself should be enough to provide adequate investment incentives there are several factors that prevent this result from being achieved and some actual markets have already experienced problems related with a lack of generation capacity a regulatory framework to address this question is presented the procedure is based on an organized market where reliability contracts based on financial call options are auctioned so both their price and their allocation among the different plants are determined through competitive mechanisms this results in a stabilization of the income of the generators and provides a clear incentive for new generation investment with a minimum of regulatory intervention additionally the method represents a market compatible mechanism to hedge demand from the occurrence of high market prices

national capacity mechanisms in the european internal energy market opening the doors to neighbours abstract after decades of strong opposition several european countries are now in the process of implementing some kind of capacity remuneration mechanism crm unfortunately these national initiatives seem to aim at energy autarky rather than seeking a wider regional coordination this situation can significantly affect the potential benefits of an integrated long term expansion of the european power system in this paper the regulatory basis for the effective participation of foreign agents in national crms is discussed the authors support that two pillars are required 1 stronger coordination among tsos 1 and respect for the security of supply directive and 2 introduce a particular type of firm cross border nominations associated to the crms commitments these proposed nominations are to be considered only in situations of system stress as discussed here this allows not requiring any type of ex ante cross border capacity reservation thus avoiding many of the inefficiencies associated to traditional physical bilateral contracts

review of the security of supply in turkish energy markets lessons from the winter shortages abstract turkey has changed the essentials of its energy markets more than a decade ago it was mainly a transition from a state led model to a free market one although some levels of progress is observable security of supply particularly in times of short term supply disruption had not been widely tested harsh winter conditions set a litmus test for turkish energy markets basing on the this test this paper provides an analysis of to what extent turkey is open to the risks of energy supply security and discusses possible measures to relieve future supply disruption risks energy policy making should consider the fact that electricity and gas markets are highly intertwined in turkey and security of supply measures could have cross market implications paper concludes

bidding strategies with fuel supply uncertainty in auctions of long term energy call options this work develops a stochastic optimization model for the creation of a bidding strategy for a generator in an energy call option auction similar to brazil s i e where the bidder can offer both the premium and the strike price the objective of the model is to maximize the bidder s competitiveness while ensuring that the project s target rate of return is achieved with a given probability for example 95 the problem s complexity is compounded by uncertainties in fuel supply and the need to switch between fuels the generators face the conundrum of bidding a single strike price to cover the expenses generated by using multiple types of fuels we address the problem of finding bidding strategies which taking into account uncertainty in fuel supply and risk constraints set the combination of strike price and option premium that ensure a desired risk adjusted return for greenfield dual fuel thermal plants

priority service pricing investment and market organization tingent forward delivery contracts offered by a seller each customer s selection of one contract from the menu determines the customer s service order or priority in each contingency the seller rations supplies by serving customers in order of their selected priorities until the supply is exhausted or all customers are served various forms of priority service are widely

adapting electricity markets to decarbonisation and security of supply objectives toward a hybrid regime abstract the policy objectives of decarbonisation of the electricity sector whilst maintaining security of supply have led to a new wave of market reforms in many jurisdictions which liberalised their industry there is a wide range of models under this new hybrid regime which essentially combine the energy market with planning and long term risk transfer arrangements this paper takes an institutionalist approach in terms of modularity of the market design and reviews the issues with the standard historical market model which led to the introduction of additional long term modules we then study the interactions between the existing and new modules and identify ways in which the initial market modules can be improved to address inconsistencies with the new modules we conclude by discussing the conditions under which the various changes in market architectures could converge toward a hybrid regime structured around a two step competition with a competition for the market via the auctioning of long term contracts to support investment followed by competition in the market for short term system optimisation via the energy market

cost overruns and financial risk in the construction of nuclear power reactors a critical appraisal lovering and colleagues attempt to advance understanding of construction cost escalation risks inherent in building nuclear reactors and power plants a laudable goal although we appreciate their focus on capital cost increases and overruns we maintain in this critical appraisal that their study conceptualizes cost issues in a limiting way methodological choices in treating different cost categories by the authors mean that their conclusions are more narrowly applicable than they describe we also argue that their study is factually incorrect in its criticism of the previous peer reviewed literature earlier work for instance has compared historical construction costs for nuclear reactors with other energy sources in many countries and extending over several decades lastly in failing to be transparent about the limitations of their own work lovering et al have recourse to a selective choice of data unbalanced analysis and biased interpretation

wholesale marginal prices in competitive generation markets wholesale marginal electricity prices are being used in several actual competitive generation markets worldwide both to remunerate generators and to charge consumption these prices must account not only for energy but also for guarantee of supply in the long and the short term this paper a provides a sound conceptual and quantitative foundation for wholesale pricing based on generation services where any existing restrictions in operation or planning in real power markets are accounted for b clearly establishes the relationship between short term marginal costs long term marginal costs and optimal wholesale electricity prices and c identifies the reasons for mismatches in cost recovery with marginal generation prices the theoretical results are verified with a detailed realistic power system model

an estimate of the value of lost load for ireland this paper estimates the value of short term lost load in the all island electricity market which includes the republic of ireland and northern ireland the value of lost load voll is the average willingness of electricity consumers to pay to avoid an additional period without power voll is also known as the value of security of electricity supply and is inferred using a production function approach detailed electricity use data for the republic of ireland allows us to estimate the value of lost load by time of day time of week and type of user we find that the value of lost load is highest in the residential sector in both the republic of ireland and northern ireland our results can be used to advise policy decisions in the case of supply outages and to encourage optimum supply security in the context of this study short term is taken to be a matter of hours rather than days or weeks

a reactive power capacity market using annual auctions this paper presents a new approach to design reactive power capacity markets under this approach annual auctions to procure reactive power capacity are conducted by the system operator two products are defined reactive power generation and absorption capacity which can be supplied by different independent var sources such as generators svcs capacitor banks and shunt reactors reactive power capacity is allocated using an optimization algorithm that matches capacity bids and system reactive power needs for peak and low demand hours the reactive power requirements are calculated taking into account system contingencies and the dynamic performance of the var sources under these situations another key proposal of the paper is the distribution of costs of the reactive power capacity market to the agents responsible for contingencies according to the use of the service by each market participant this remuneration approach provides fair and efficient economic signals to all market participants the applicability of the approach is illustrated with two case studies

investment incentives in the korean electricity market abstract this paper develops a model based analysis of the effects of various capacity incentive systems on new investment in the korean electricity market the restructuring process in korea allocated power generation to six firms competing within a wholesale market albeit strictly on a cost basis because of this cost based pool capacity payments were also introduced to encourage new investment however it is an open question whether the current fixed capacity payment scheme is enough to secure resource adequacy and consideration is being given to alternative mechanisms such as the use of lolp using a detailed market simulation model based on system dynamics we compare these approaches in terms of how they may influence the investors decisions and thereby determine the system reserve margin the simulation results suggest that there may be serious problems in staying with the current fixed capacity payments in order to achieve resource adequacy in contrast an lolp based capacity mechanism may in the longer term increase the reserve margin compared with a fixed capacity payment more generally this paper indicates how crucial the effective modeling of the investment behavior of the independent power producers is for adequate policy support even if they only constitute a fringe in a substantially centrally influenced market

calculation and decomposition of indirect carbon emissions from residential consumption in china based on the input output model abstract based on the input output model and the comparable price input output tables the current paper investigates the indirect carbon emissions from residential consumption in china in 1992 2005 and examines the impacts on the emissions using the structural decomposition method the results demonstrate that the rise of the residential consumption level played a dominant role in the growth of residential indirect emissions the persistent decline of the carbon emission intensity of industrial sectors presented a significant negative effect on the emissions the change in the intermediate demand of industrial sectors resulted in an overall positive effect except in the initial years the increase in population prompted the indirect emissions to a certain extent however population size is no longer the main reason for the growth of the emissions the change in the consumption structure showed a weak positive effect demonstrating the importance for china to control and slow down the increase in the emissions while in the process of optimizing the residential consumption structure the results imply that the means for restructuring the economy and improving efficiency rather than for lowering the consumption scale should be adopted by china to achieve the targets of energy conservation and emission reduction

a critical assessment of the different approaches aimed to secure electricity generation supply abstract since the very beginning of the power systems reform process one of the key questions posed has been whether the market of its own accord is able to provide satisfactory security of supply at the power generation level or if some additional regulatory mechanism needs to be introduced and in the latter case which is the most suitable approach to tackle the problem this matter is undoubtedly gaining importance and it has taken a key role in the energy regulators agendas in this paper we critically review and categorize the different approaches regulators can opt for to deal with the problem of guaranteeing or at least enhancing security of supply in a market oriented environment we analyze the most relevant regulatory design elements throughout an updated assessment of the broad range of international experiences highlighting the lessons we have learned so far in a variety of contexts based on the analysis we conclude by providing a set of principles and criteria that should be considered by the regulator when designing a security of supply mechanism

renewables vs energy efficiency the cost of carbon emissions reduction in spain while support instruments have succeeded to largely deploy renewables during the 1996 2008 period little attention has been paid to energy efficiency measures resulting in a high energy intensity and large growth of energy demand energy related co2 emissions have increased significantly at the same time important investments in combined cycle gas turbines have taken place this paper analyses whether from a cost minimization viewpoint renewable support has been the best policy for reducing emissions when compared to the promotion of energy efficiency in sectors such as transportation or buildings we use a model of the spanish energy sector to examine its evolution in the time period considered under different policies it is a bottom up static partial equilibrium linear programming model of the complete spanish energy system we conclude that demand side management dsm clearly dominates renewable energy re support if the reduction of emissions at minimum cost is the only concern we also quantify the savings that could have been achieved a total of 5 billion per year mainly in re subsidies and in smaller costs of meeting the reduced demand net of dsm implementation cost

vertical integration credit ratings and retail price settings in energy only markets navigating the resource adequacy problem abstract energy only markets are prone to the resource adequacy problem i e the timely entry of new plant the reason for this is that competitive energy only markets struggle to be remunerative given reliability constraints and market price caps historically australia s 45 000 mw national electricity market has managed to navigate this well understood problem albeit with government entities directly or indirectly responsible for a surprisingly large 73 of all new plant investments to 2007 but government involvement in direct investment has now ceased so what will enable the industry to navigate the resource adequacy problem into the future quite simply industrial organisation the presence of merchant utilities with investment grade credit ratings and setting any regulated retail prices or price to beat with an lrmc floor

investing in electricity production under a reliability options scheme abstract reliability options ros are used to enhance the security of supply in electricity systems when a power producer writes a ro s he agrees to set a cap on the price of electricity that s he cashes in return the system operator i e the party that is buying the option pays to the option issuer a fixed premium in this paper we analyze how ros affect the timing and value of investments in the energy sector and we show under what conditions they can be used as investment stimuli we prove that contrarily to what is expected ros can potentially harm the security of supply by delaying the adoption of new capacity and by reducing the value of investing in it to avoid such a result a careful setting of the relevant parameters is needed

analysis of generation investment under different market designs in this paper a stochastic dynamic optimization model is used to analyze the effect of different market designs on generation investment and demand the expansion decisions of profit maximizing investors are simulated under four different market designs energy only capacity payment capacity obligation and capacity subscription the results show that the overall social welfare is reduced compared to a centralized social welfare optimization for the first three policies in particular an energy only market with a low price cap leads to insufficient generation investments capacity payments and obligations give additional investment incentives and more generating capacity but also result in a considerable transfer of wealth from consumers to producers due to the capacity payments in contrast the capacity subscription policy increases the social welfare and both producers and consumers benefit this is possible because capacity subscription explicitly utilizes differences in consumers preferences for uninterrupted supply this advantage must be weighed against the cost of implementation which is not included in the model

electricity market design for generator revenue sufficiency with increased variable generation we present a computationally efficient mixed integer program mip that determines optimal generator expansion decisions and hourly unit commitment and dispatch in a power system the impact of increasing wind power capacity on the optimal generation mix and generator profitability is analyzed for a test case that approximates the electricity market in texas ercot we analyze three market policies that may support resource adequacy operating reserve demand curves ordc fixed reserve scarcity prices frsp and fixed capacity payments cp optimal expansion plans are comparable between the ordc and frsp implementations while capacity payments may result in additional new capacity the frsp policy leads to frequent reserves scarcity events and corresponding price spikes while the ordc implementation results in more continuous energy prices average energy prices decrease with increasing wind penetration under all policies as do revenues for baseload and wind generators intermediate and peak load plants benefit from higher reserve prices and are less exposed to reduced energy prices all else equal an ordc approach may be preferred to frsp as it results in similar expansion and revenues with less extreme energy prices a fixed cp leads to additional new flexible ngct units but lower profits for other technologies

evaluation of electricity supply sustainability and security multi criteria decision analysis approach abstract electricity supply plays a significantly important role in national economy and society development accordingly the evaluation of electricity supply sustainability and security as an early warning method is beneficial for the decision makers policy makers to take various measures to enhance electricity supply sustainability and security this study aims at developing a multi criteria decision analysis framework for electricity supply sustainability and security evaluation and a total of nine metrics i e shannon weiner index electricity import dependence supply adequacy rural electrification rate electric power losses ratio residential consumption ratio electricity per gross domestic product electric power consumption per capita and fossil fuel dependence in four dimensions including availability and security of supply affordability and reliability energy and economic efficiency and environmental stewardship were employed for electricity supply sustainability and security evaluation fuzzy analytic hierarchy process which allows the users to use linguistic terms to express their opinions was used to determine the weights of the criteria which represent their relative importance in the evaluation of electricity supply sustainability and security grey rational analysis was used to prioritize the status of electricity supply sustainability and security of different countries in different years the electricity supply sustainability and security of the five major emerging national economies brazil russia india china and south africa was studied in chinese perspective by the proposed method

enhancing power supply adequacy in spain migrating from capacity payments to reliability options there has been total unanimity about the vital importance of reliability of supply since the beginning of the electricity sector deregulation process this paper describes the procedure proposed by perez arriaga et al 2005 white paper for the reform of the regulatory scheme of the power generation in spain for the ministry of industry tourism and trade of spain in spanish to improve upon the current scheme to guarantee a reasonable reserve margin the capacity payment mechanism this alternative design introduces improvements aimed at guaranteeing at least a minimum capacity reserve margin as well as at providing a strong incentive for generating units to be available when needed namely in situations when supply is likely to be insufficient to meet the total demand

modeling generation expansion in the context of a security of supply mechanism based on long term auctions application to the colombian case abstract in an attempt to provide electricity generation investors with appropriate economic incentives so as to maintain quality of supply at socially optimal levels a growing number of electricity market regulators have opted for implementing a security of supply mechanism based on long term auctions in this context the ability to analyze long term investment dynamics is a key issue not only for market agents but also for regulators this paper describes a model developed to serve this purpose a general system dynamics inspired methodology has been designed to be able to simulate these long term auction mechanisms in the formats presently in place a full scale simulation based on the colombian system was conducted to illustrate model capabilities

contracting strategies for renewable generators a hybrid stochastic and robust optimization approach we present a new methodology to support an energy trading company etc to devise contracting strategies under an optimal risk averse renewable portfolio the uncertainty in the generation of renewable energy sources is accounted for by exogenously simulated scenarios as is customary in stochastic programming however we recognize that spot prices largely depend on unpredictable market conditions making it difficult to capture its underlying stochastic process which challenges the use of fundamental approaches for forecasting under such framework industry practices make use of stress tests to validate portfolios we then adapt the robust optimization approach to perform an endogenous stress test for the spot prices as a function of the buy and sell portfolio of contracts and renewable energy generation scenarios the optimal contracting strategy is built through a bilevel optimization model that uses a hybrid approach mixing stochastic and robust optimization the proposed model is flexible to represent the traditional stochastic programming approach and to express the etc s uncertainty aversion in the case where the price distribution cannot be precisely estimated the effectiveness of the model is illustrated with examples from the brazilian market where the proposed approach is contrasted to its stochastic counterpart and both are benchmarked against observed market variables

reliability payments to generation capacity in electricity markets abstract electric power is a critical input to modern economies generation adequacy and security of supply in power systems running under competition are currently topics of high concern for consumers regulators and governments in a market setting generation investments and adequacy can only be achieved by an appropriate regulatory framework that sets efficient remuneration to power capacity theoretically energy only electricity markets are efficient and no additional mechanism is needed nonetheless the energy only market design suffers from serious drawbacks therefore jointly with the evolution of electricity markets many remunerating mechanisms for generation capacity have been proposed explicit capacity payment was the first remunerating approach implemented and perhaps still the most applied however this price based regulation has been applied no without severe difficulties and criticism in this paper a new reliability payment mechanism is envisioned capacity of each generating unit is paid according to its effective contribution to overall system reliability the proposed scheme has many attractive features and preserves the theoretical efficiency properties of energy only markets fairness incentive compatibility market power mitigation and settlement rules are investigated in this work the article also examines the requirements for system data and models in order to implement the proposed capacity mechanism a numerical example on a real hydrothermal system serves for illustrating the practicability of the proposed approach and the resulting reliability payments to the generation units

quality frontier of electricity distribution supply security best practices and underground cabling in finland electricity distribution is a prime example of local monopoly in most countries the costs of electricity distribution operators are regulated by the government however the cost regulation may create adverse incentives to compromise the quality of service to avoid this cost regulation is often amended with quality incentives this study applies theory and methods of productivity analysis to model the frontier of service quality a semi nonparametric estimation method is developed which does not assume any particular functional form for the quality frontier but can accommodate stochastic noise and heteroscedasticity the empirical part of our paper examines how underground cabling and location affect the interruption costs as expected higher proportion of underground cabling decreases the level of interruption costs the effects of cabling and location on the variance of performance are also considered especially the location is found to be a significant source of heteroscedasticity in the interruption costs finally the proposed quality frontier benchmark is compared to the current practice of finnish regulation system the proposed quality frontier is found to provide more meaningful and stable basis for setting quality targets than the average practice benchmarks currently in use

comparing the costs of intermittent and dispatchable electricity generating technologies economic evaluations of alternative electric generating technologies typically rely on comparisons between their expected life cycle production costs per unit of electricity supplied the standard life cycle cost metric utilized is the levelized cost per mwh supplied this paper demonstrates that this metric is inappropriate for comparing intermittent generating technologies like wind and solar with dispatchable generating technologies like nuclear gas combined cycle and coal levelized cost comparisons are a misleading metric for comparing intermittent and dispatchable generating technologies because they fail to take into account differences in the production profiles of intermittent and dispatchable generating technologies and the associated large variations in the market value of the electricity they supply levelized cost comparisons overvalue intermittent generating technologies compared to dispatchable base load generating technologies they also overvalue wind generating technologies compared to solar generating technologies integrating differences in production profiles the associated variations in the market value of the electricity supplied and life cycle costs associated with different generating technologies is necessary to provide meaningful comparisons between them this market based framework also has implications for the appropriate design of procurement auctions created to implement renewable energy procurement mandates the efficient structure of production tax credits for renewable energy and the evaluation of the additional costs of integrating intermittent generation into electric power networks

efficient pollution regulation getting the prices right this paper argues for efficient environmental regulations that equate the mar ginal damage of pollution to marginal abatement costs across space the paper estimates the source specific marginal damages of air pollution and calculates the welfare gain from making the current sulfur dioxide allowance trading pro gram for power plants more efficient the savings from using trading ratios based on marginal damages are between 310 and 940 million per year the potential savings from setting aggregate emissions efficiently and from includ ing more sources of air pollution are many times higher jel h23 q53 q58

an analysis of a forward capacity market with long term contracts we analyze the effectiveness of a forward capacity market fcm with long term contracts in an electricity market in the presence of a growing share of renewable energy an agent based model is used for this analysis capacity markets can compensate for the deteriorating incentive to invest in controllable power plants when the share of variable renewable energy sources grows but may create volatile prices themselves capacity markets with long term contracts have been developed e g in the uk to stabilize capacity prices in our analysis a fcm is effective in providing the required adequacy level and leads to lower cost to consumers and more stable capacity prices as compared to a yearly capacity market in case of a demand shock a fcm may develop an investment cycle but it still maintains security of supply its main effect on the power plant portfolio is more investment in peak plant

a 100 year review of electricity policy in ireland 1916 2015 abstract over the past century ireland s electricity sector has undergone a significant transformation this paper documents the nation s struggle to build an electricity system to improve security of electricity supply through portfolio diversification and to promote indigenous energy sources this was a challenge for an electrically isolated island with little natural resources the paper also identifies the ineffective policy decisions that left ireland exposed to the 1970s energy crises the crises did however provide a clear impetus for focusing irish energy policy going forward the successful deployment and integration of large scale wind power was due to strong national and supranational policy decisions in 2015 ireland had the third highest wind energy share of national electricity demand 22 8 of all iea wind member countries the paper also traces ireland s transition through market reform regional fragmentation and looks onwards to the eu internal market for electricity in essence this paper provides a holistic view of the implications of various policy decisions on the electricity sector along with the stresses of external factors on the electricity market and should be useful for policy makers elsewhere faced with similar decisions

contracting with private rewards i extend the canonical moral hazard model to allow the agent to face endogenous and non contractible uncertainty the agent works for the principal and simultaneously pursues private rewards i establish conditions under which the first order approach remains valid the model adds to the literature on intrinsic versus extrinsic motivation specifically to induce higher effort at work the contract may offer higher rewards but flatter incentives the contract change makes the agent reevaluate his work life balance larger employment rewards lessens the incentive to pursue private rewards the greater reliance on labor income then necessitates weaker explicit incentives to induce high effort

are you happy while you work using a new data source permitting individuals to record their well being via a smartphone we explore within person variance in individuals well being measured momentarily at random points in time we find paid work is ranked lower than any of the other 39 activities individuals can report engaging in with the exception of being sick in bed precisely how unhappy one is while working varies significantly with where you work whether you are combining work with other activities whether you are alone or with others and the time of day or night you are working

long term assessment of power capacity incentives by modeling generation investment dynamics under irreversibility and uncertainty abstract in actual energy only markets the high volatility of power prices affects the expected returns of generators when dealing with irreversibility under uncertainty deferring decisions to commit in new power plants waiting for better information is therefore a rational approach theoretical and empirical evidence suggests that such investment pattern determines the occurrence of construction cycles which strongly compromise supply security in order to supplement generators revenues several remuneration mechanisms have been devised over past years along this line this work addresses the long run dynamics of capacity adequacy and market efficiency with both a price based and a quantity based capacity remuneration policy for that purpose a recently developed stochastic simulation model is used as a benchmark hence the optimal postponement of generation investment decisions is integrated into a long run power market model by formulating the decision making problem in the framework of real options analysis results suggest that policymakers may exchange supply security effectiveness for energy prices to be paid by consumers efficiency when designing and implementing capacity remuneration mechanisms by doing so this article contributes to the ongoing debate regarding the design of incentive policies and efficient power markets by considering the microeconomics of investors decision making under irreversibility and uncertainty

a comparative analysis of electricity generation costs from renewable fossil fuel and nuclear sources in g20 countries for the period 2015 2030 abstract despite the positive momentum achieved by the renewable energy sector in recent years there are substantial challenges that need the attention of the global community and one of the more pressing issues is dealing with the deleterious external costs of power generation one of the parameters to compare costs of energy across various technologies is levelised cost of energy lcoe but it has been conventional practice to neglect the external costs in estimating the lcoe of power generation technologies furthermore as lcoe is a critical indicator for policy and decision makers there is a need to juxtapose actual costs of renewable and conventional power generation technologies this research paper attempts to internalise some of these external and ghg emission costs across various power generation and storage technologies in all the g20 countries as they account for 85 of global power consumption as future investment decisions are largely influenced by costs estimates in this research prove renewables and storage to be far cheaper than fossil and nuclear sources by 2030 even without considering external costs the myth that renewables are way too expensive has been debunked repeatedly and the cost decline of wind and solar photovoltaic pv technologies have outpaced most industry expectations the results of this research not only substantiate this trend but also statistically display that all the g20 countries have the opportunity to decrease their energy costs significantly between now and 2030 renewable energy technologies offer the lowest lcoe ranges across g20 countries in 2030 utility scale solar pv generally shows the lowest values ranging from 16 to 117 mwhel and onshore wind lcoe range is from 16 to 90 mwhel rooftop solar pv generally offers the next lowest lcoe ranging from 31 to 126 mwhel followed by lcoe of offshore wind power ranging from 64 to 135 mwhel solar pv and battery systems are highly competitive on an lcoe basis at utility scale ranging from 21 to 165 mwhel and at residential scale from 40 to 204 mwhel the g20 as well as other countries can continue to develop their economies in a sustainable manner along with substantial co benefits in adjacent policy fields such as higher national welfare better health of citizens lower respective health costs and improved energy security