Structural breaks and electricity prices: Further evidence on the role of climate policy uncertainties in the Australian electricity market

Apergis, Nicholas and Lau, Chi Keung (2015) Structural breaks and electricity prices: Further evidence on the role of climate policy uncertainties in the Australian electricity market. Energy Economics, 52 (A). pp. 176-182. ISSN 0140-9883

[img] Text (Full text)
energy economics.pdf - Accepted Version
Restricted to Repository staff only until December 2019.

Download (296kB)
Official URL: http://www.sciencedirect.com/science/article/pii/S...

Abstract

The primary objectives and the strategies of a national electricity market are the efficient delivery of network services and the electricity infrastructure to meet the long-term consumer's interests. Therefore, the objective of this study is to explore whether electricity prices across the six Australian States display instability. Such instability is closely associated with the presence of structural breaks in relevance to policy events on Australian carbon policies. The study makes use of weekly Australian wholesale electricity prices spanning the period from June 8th, 2008 to March 30th, 2014 along with linear and non-linear unit root testing methodologies. The results provide supportive evidence that the Australian electricity market can be described as a less stable electricity market, which implies that a high degree of market power is exercised by generators across regional markets. These findings are expected to have substantial consequences for the effectiveness of carbon dioxide mitigating policies, especially, when there is uncertainty as to whether the planned environmental policy is put in place for the lifespan of undertaken investments.

Item Type: Article
Uncontrolled Keywords: Electricity prices; Structural breaks; Climate policy uncertainty; Australia
Subjects: L100 Economics
Department: Faculties > Business and Law > Newcastle Business School > Business and Management
Depositing User: Chi Keung Lau
Date Deposited: 17 Nov 2015 13:29
Last Modified: 22 Jul 2017 01:24
URI: http://nrl.northumbria.ac.uk/id/eprint/24513

Actions (login required)

View Item View Item

Downloads

Downloads per month over past year

View more statistics


Policies: NRL Policies | NRL University Deposit Policy | NRL Deposit Licence