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Energiewende and competition in Germany: Diagnosing market power in wholesale electricity market

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  • Thao Pham

Abstract

German power market has undergone many fundamental changes in 2011 following the Fukushima nuclear accident (March 2011). Prices on wholesale electricity market are at the highest level since mid-2009. The purpose of this chapter is to identify whether market power is responsible for this increase. Following the method of linear programming as commonly used in the literature of electricity market modelling, we simulate a competitive benchmark for German wholesale market taking into account power plant characteristics, fuel and CO2-allowance prices and renewables power generation. On the basis of the difference between modeled marginal costs and observed market prices, we estimate the price-cost markups, or the Lerner Indexes across hours. .

Suggested Citation

  • Thao Pham, 2015. "Energiewende and competition in Germany: Diagnosing market power in wholesale electricity market," ECONOMICS AND POLICY OF ENERGY AND THE ENVIRONMENT, FrancoAngeli Editore, vol. 2015(2), pages 29-49.
    • Handle: RePEc:fan:efeefe:v:html10.3280/efe2015-002004
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    References listed on IDEAS

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    More about this item

    JEL classification:

    • L13 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Oligopoly and Other Imperfect Markets
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • D43 - Microeconomics - - Market Structure, Pricing, and Design - - - Oligopoly and Other Forms of Market Imperfection

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