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Joint Energy and Economic Optimization: A Proposition

Donald I. Hertzmark

Year: 1981
Volume: Volume 2
Number: Number 1
DOI: 10.5547/ISSN0195-6574-EJ-Vol2-No1-5
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Abstract:
This article gives some analytical results of an attempt to optimize economic and thermodynamic efficiency simultaneously. The attempt to impose complete mathematical rationality and consistency on the pricing of energy commodities fails. since it is not possible to weigh consistently purely physical efficiency measures. much less social factors. This means that energy or entropy theories of value must suffer the fate of other single-factor theories. such as the labor theory of value. Such a single-factor theory cannot adequately handle such questions as fixed capital, subjective utility. and contradictory constraints on economic choice.



Nuclear Power: A Hedge against Uncertain Gas and Carbon Prices?

Fabien A. Roques , William J. Nuttall, David M. Newbery, Richard de Neufville, Stephen Connors

Year: 2006
Volume: Volume 27
Number: Number 4
DOI: 10.5547/ISSN0195-6574-EJ-Vol27-No4-1
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Abstract:
High fossil fuel prices have rekindled interest in nuclear power. This paper identifies specific characteristics making nuclear power unattractive to merchant generators in liberalized electricity markets, and argues that non-fossil fuel technologies have an overlooked option value given fuel and carbon price uncertainty. Stochastic optimization estimates the company option value of keeping open the choice between nuclear and gas technologies. The merchant option value decreases sharply as the correlation between electricity, gas, and carbon prices rises, casting doubt on whether merchant investors have adequate incentives to choose socially efficient diversification in liberalized electricity markets.



Simulating Security of Supply Effects of the Nabucco and South Stream Projects for the European Natural Gas Market

Caroline Dieckhoner

Year: 2012
Volume: Volume 33
Number: Number 3
DOI: 10.5547/01956574.33.3.6
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Abstract:
Because of the decrease in domestic production in Europe, additional natural gas volumes will be required. In addition to Nord Stream, the major import pipeline projects, Nabucco and South Stream, have been announced to provide further gas supplies to Europe. This raises the question concerning whether and how these projects contribute to the European Union's focus on security of supply. Applying the natural gas infrastructure model TIGER, this paper investigates the impact of these pipeline projects on southeastern Europe's gas supply. Gas flows and marginal cost prices are evaluated in general and considering the possibility of supply disruptions via Ukraine for the year 2020. The model results show a positive impact of these pipelines on security of supply despite few consumer cut-offs that result from intra-European bottlenecks. South Stream is only highly utilized in case of a Ukraine crisis, supporting the idea that its main purpose is to bypass Ukraine. Keywords: Natural gas, security of supply, Nabucco, South Stream, linear-optimization, transport infrastructure



Geospatial, Temporal and Economic Analysis of Alternative Fuel Infrastructure: The case of freight and U.S. natural gas markets

Yueyue Fan, Allen Lee, Nathan Parker, Daniel Scheitrum, Rosa Dominguez-Faus, Amy Myers Jaffe, and Kenneth Medlock III

Year: 2017
Volume: Volume 38
Number: Number 6
DOI: 10.5547/01956574.38.6.yfan
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Abstract:
The transition to low-carbon fuel in the United States has spatial, temporal and economic aspects. Much of the economic literature on this topic has focused on aspects of the cost effectiveness of competing fuels. We expand this literature by simultaneously considering spatial, temporal and economic aspects in an optimization framework that integrates geographic information system (GIS) tools, network analysis, technology choice pathways and a vehicle demand choice model. We focus on natural gas fuel as a low-carbon alternative to oil-based diesel fuel in the heavy-duty sector primarily because of the recent cost benefits relative to diesel fuel and the high vehicle turnover rate in heavy-duty trucks. We find that the level of profitability of natural gas fueling infrastructure depends more on volume of traffic flows rather than proximity to natural gas supply.



Reforming the Operation Mechanism of Chinese Electricity System: Benefits, Challenges and Possible Solutions

Hao Chen, Chi Kong Chyong, Zhifu Mi, and Yi-Ming Wei

Year: 2020
Volume: Volume 41
Number: Number 2
DOI: 10.5547/01956574.41.2.hche
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Abstract:
A new wave of electricity market reform was launched by the Chinese government in March 2015, and one of its major objectives was to optimize the power system operation by reforming the low-efficient equal share dispatch mechanism. To provide scientific decision-making support for the current reform, we establish a mixed-integer linear programming optimization model to simulate the post-reform results, and the reform benefits are subsequently estimated by comparing those results with the pre-reform results. Then, we develop a political economy framework to identify the challenges associated with implementation of economic dispatch. At last, we propose several regulatory and market measures to address these identified challenges.





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