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How Distortion on the Electric Power Market Can Lead to Stagflation

Author

Listed:
  • France Krizanic

    (EIPF d.o.o. Economic institute -Pre ernova c. 21- SI 1000, Ljubljana, Slovenia,)

  • Joze Mencinger

    (EIPF d.o.o. Economic institute -Pre ernova c. 21- SI 1000, Ljubljana, Slovenia,)

  • Zan Oplotnik

    (Faculty of Economics and Business, University of Maribor, Razlagova 14 SI 2000 Maribor, Slovenia)

Abstract

At the time of the possible closure of the significant Slovenian classical electricity production in the o tanj Thermal Power Plant and related Velenje Coal Mine, as well as the termination of the subsidies of cost-inefficient electric power production in EU member states, electricity prices in Slovenia for one third of its supply would rise to a level set to cover the cost of its production with a conventional gas-steam turbine. Calculated for the price of electricity produced in the o tanj Thermal Power Plant, this means an average price increase of 39 /MWh. Higher prices of electricity would affect the performance and capacity of the Slovenian economy while bringing a reduction to real household income along with annual drops in Slovenian GDP of 0.4%, Slovenia would stand to lose around 2,700 jobs, and the consumer price level would rise by 0.4%.

Suggested Citation

  • France Krizanic & Joze Mencinger & Zan Oplotnik, 2019. "How Distortion on the Electric Power Market Can Lead to Stagflation," International Journal of Energy Economics and Policy, Econjournals, vol. 9(1), pages 26-30.
    • Handle: RePEc:eco:journ2:2019-01-4
    as

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    References listed on IDEAS

    as
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    More about this item

    Keywords

    Electricity Power Market; Electricity Supply and Demand; Energy and the Economy;
    All these keywords.

    JEL classification:

    • D40 - Microeconomics - - Market Structure, Pricing, and Design - - - General
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q3 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Nonrenewable Resources and Conservation
    • Q43 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Energy and the Macroeconomy

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