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Market coupling between electricity markets: theory and empirical evidence for the Italian–Slovenian interconnection

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  • Lucia Parisio

    (University of Milan-Bicocca)

  • Matteo Pelagatti

    (University of Milan-Bicocca)

Abstract

Since January 1, 2011 the electricity exchanges of Italy and Slovenia are working under a mechanism of market coupling for their respective day-ahead sessions. Similar mechanisms are being implemented in many European countries to foster the integration of power markets that eventually will merge into one large European exchange. This paper is one of the first works in which, by analyzing market results, we try and assess the degree of integration of the Italian and Slovenian electricity markets due to the market coupling policy. Empirical results are useful to evaluate the success of the EU Price Coupling of Regions policy and suggest further enhancements.

Suggested Citation

  • Lucia Parisio & Matteo Pelagatti, 2019. "Market coupling between electricity markets: theory and empirical evidence for the Italian–Slovenian interconnection," Economia Politica: Journal of Analytical and Institutional Economics, Springer;Fondazione Edison, vol. 36(2), pages 527-548, July.
    • Handle: RePEc:spr:epolit:v:36:y:2019:i:2:d:10.1007_s40888-018-0126-2
    DOI: 10.1007/s40888-018-0126-2
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    Cited by:

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    2. Montoya, L.G. & Guo, B. & Newbery, D. & Dodds, P.E. & Lipman, G. & Castagneto Gissey, G., 2020. "Measuring inefficiency in international electricity trading," Energy Policy, Elsevier, vol. 143(C).
    3. Lange, Andreas & Ross, Johannes, 2024. "Internalizing match-dependent externalities," Journal of Economic Behavior & Organization, Elsevier, vol. 218(C), pages 356-378.
    4. Erwan Pierre & Lorenz Schneider, 2024. "Intermittently coupled electricity markets," Post-Print hal-04411166, HAL.
    5. Sapio, Alessandro & Spagnolo, Nicola, 2020. "The effect of a new power cable on energy prices volatility spillovers," Energy Policy, Elsevier, vol. 144(C).
    6. Pierre, Erwan & Schneider, Lorenz, 2024. "Intermittently coupled electricity markets," Energy Economics, Elsevier, vol. 130(C).

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    More about this item

    Keywords

    Electricity markets; Market coupling; Cointegration; Robustness;
    All these keywords.

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • C22 - Mathematical and Quantitative Methods - - Single Equation Models; Single Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes
    • C32 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Time-Series Models; Dynamic Quantile Regressions; Dynamic Treatment Effect Models; Diffusion Processes; State Space Models

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