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Business Model and Market Design for ASEAN Electricity Market Integration: Principles, Practicalities, and Conditions for Success

In: Achieving an Integrated Electricity Market in Southeast Asia: Addressing the Economic, Technical, Institutional, and Geo-political Barriers

Author

Listed:
  • Yanfei Li
  • Youngho Chang
  • Choo Fook Hoong
  • Swati Sharma

Abstract

The research is divided into four interdependent research clusters. Clusters 1 and 2 apply case studies on the BIMP countries (Brunei-Indonesia-Malaysia-Philippines) using different methods. Cluster 1, led by the Institute of Energy Economics, Japan, conducts dynamic linear programming model to simulate the development of power infrastructure, interconnection, and exchange of power in this subregion of ASEAN. It emphasises the economic rationale and feasibility of electricity market integration in the region. Cluster 2, led by the Brunei National Energy Research Institute, focuses on the regulatory, institutional, and technical barriers in BIMP, and develops a road map to solve these issues. This study thus gives some insight regarding regional specific barriers or issues for other regions based on an established understanding of the common issues in principle from previous studies. Cluster 3 is conducted jointly by the Economic Research Institute for ASEAN and East Asia and the Energy Research Institute at Nanyang Technological University. The study mainly refers to the Nordic and European cases of electricity market integration and analyses both their business models and overall market design for grid interconnection and cross-border trading of electricity. In doing so, the study eventually tries to deliver implications on the possible business model and market design for ASEAN. The Cluster 4 study, carried out by a researcher from the University of Western Australia, discusses political and institutional barriers to the formation of an integrated ASEAN electricity market and derives several practical strategies in addressing such barriers as policy implications.

Suggested Citation

  • Yanfei Li & Youngho Chang & Choo Fook Hoong & Swati Sharma, 2016. "Business Model and Market Design for ASEAN Electricity Market Integration: Principles, Practicalities, and Conditions for Success," Chapters, in: Yanfei Li & Shigeru Kimura (ed.), Achieving an Integrated Electricity Market in Southeast Asia: Addressing the Economic, Technical, Institutional, and Geo-political Barriers, chapter 3, pages 59-108, Economic Research Institute for ASEAN and East Asia (ERIA).
    • Handle: RePEc:era:chaptr:2015-rpr-16-3
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    References listed on IDEAS

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    1. Weigt, Hannes, 2009. "A Review of Liberalization and Modeling of Electricity Markets," MPRA Paper 65651, University Library of Munich, Germany.
    2. Yanrui Wu & Xunpeng Shi & Fukunari Kimura & Yu Sheng & Youngho Chang & Yanfei Li & Sun Xuegong & Guo Liyan & Zeng Zheng & Daisy Shen & Qing Yang & Kongchheng Poch & Savong Tuy & Sekar Utami Setiastuti, . "Energy Market Integration in East Asia: Theories, Electricity Sector and Subsidies," Books, Economic Research Institute for ASEAN and East Asia (ERIA), number 2011-rpr-17 edited by Yanrui Wu & Xunpeng Shi & Fukunari Kimura, January.
    3. Tooraj Jamasb and Michael Pollitt, 2005. "Electricity Market Reform in the European Union: Review of Progress toward Liberalization & Integration," The Energy Journal, International Association for Energy Economics, vol. 0(Special I), pages 11-42.
    4. Fridolfsson, Sven-Olof & Tangerås, Thomas, 2008. "Market Power in the Nordic Wholesale Electricity Market: A Survey of the Empirical Evidence," Working Paper Series 773, Research Institute of Industrial Economics.
    5. Böckers, Veit & Haucap, Justus & Heimeshoff, Ulrich, 2013. "Benefits of an integrated European electricity market," DICE Discussion Papers 109, Heinrich Heine University Düsseldorf, Düsseldorf Institute for Competition Economics (DICE).
    6. Youngho Chang & Yanfei Li, . "Power Generation and Cross-border Grid Planning for the Integrated ASEAN Electricity Market: A Dynamic Linear Programming Model," Chapters, in: Yanrui Wu & Xunpeng Shi & Fukunari Kimura (ed.), Energy Market Integration in East Asia: Theories, Electricity Sector and Subsidies, chapter 3, pages 37-58, Economic Research Institute for ASEAN and East Asia (ERIA).
    7. Yanrui Wu, 2012. "Electricity Market Integration Global Trends and Implications for the EAS Region," Economics Discussion / Working Papers 12-19, The University of Western Australia, Department of Economics.
    8. Li, Yanfei & Chang, Youngho, 2015. "Infrastructure investments for power trade and transmission in ASEAN+2: Costs, benefits, long-term contracts and prioritized developments," Energy Economics, Elsevier, vol. 51(C), pages 484-492.
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    Cited by:

    1. Christos Roumkos & Pandelis N. Biskas & Ilias G. Marneris, 2022. "Integration of European Electricity Balancing Markets," Energies, MDPI, vol. 15(6), pages 1-26, March.

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