Econonomics of Energy and Environmental Policy
Article Details

IAEE Members and subscribers to Economics of Energy & Environmental Policy : Please log in to access the full text article.

All quiet on the western front? Transmission capacity development in the Nordic electricity market

Infrastructure plays an obvious and crucial role in electricity markets. Physical infrastructure must exist for the supply to meet demand in real time. In addition, it accommodates the efficient exchange of cost-efficient production across borders, and can bean important part ofsharingresourcesforreliabilitypurposes.However, in the historically successful Nordic electricity market, the cross-border transmission grid investments are lagging behind the original schedule agreed between the Nordic TSOs. Moreover, in early 2013, the Norwegian and Swedish Transmission System Operators (TSOs) cancelled the planned, by many considered critical, Hasle (Westlink) transmission capacity increase. This paper addresses several issues concerning the cross-border transmission planning and its role for successful integration of the electricity markets. We aim at evaluating the impact of different institutional requirements for key entities as well as the changing governance structure to highlight how the infrastructure development paths are dependent on these. The evaluation of the governance structure presented in this paper is based on the historical experiences of the Nordic electricity market. Our findings suggest that the national goals in transmission development contradict the Nordic capacity development targets.
Purchase PDF ( $35 ) Purchase Ebook ( $35 )
Executive Summary: View

JEL Codes:L51: Economics of Regulation, L94: Electric Utilities, Q41: Energy: Demand and Supply; Prices

Keywords: capacity, development, electricity, governance, institutional setting, transmission

DOI: 10.5547/2160-5890.4.2.mmak

Reference information is available for this article. Join IAEE or purchase the article to view reference data.

Published in Volume 4, Number 2 of The Quarterly Journal of the IAEE's Energy Economics Education Foundation.


© 2020 International Association for Energy Economics | Privacy Policy | Return Policy