Assessing welfare impact of entry into power market

In Koo Cho, Hyunsook Kim

Research output: Contribution to journalArticle

Abstract

This paper calculates the welfare impact of a new entrant based on the location of entry in the Korean electricity market. We use two different models. One is the optimal fuel mix model to estimate the effect of a new entry in the long run. The other is the variable cost minimization model to assess the contribution of an existing installed private generator in the short run. A specific private generator, which has a cost advantage, saves a substantial amount of system-wide variable costs. We show that the right location for a new entrant can save power generation costs significantly, even if a new entrant does not have a cost advantage.

Original languageEnglish
Pages (from-to)1046-1054
Number of pages9
JournalEnergy Policy
Volume61
DOIs
StatePublished - 2013 Oct 1

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welfare impact
market
cost
Costs
power generation
Power generation
electricity
Power markets

Keywords

  • Entry
  • Network constraint
  • Social welfare

Cite this

Cho, In Koo ; Kim, Hyunsook. / Assessing welfare impact of entry into power market. In: Energy Policy. 2013 ; Vol. 61. pp. 1046-1054.
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Assessing welfare impact of entry into power market. / Cho, In Koo; Kim, Hyunsook.

In: Energy Policy, Vol. 61, 01.10.2013, p. 1046-1054.

Research output: Contribution to journalArticle

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