Being in Balance: Economic Efficiency in the Dutch Power Market
18 Pages Posted: 28 Sep 2004
Date Written: 13 2004 8,
In this paper, we examine economic efficiency in the Dutch power market, an important pillar for successful creation of a competitive and non-discriminatory free power market. We examine historical time series of prices and volumes on the Dutch balancing market where energy companies are obliged to offer reserve capacity in order to offset power surpluses and deficits on the grid. We argue that these balancing prices and volumes are indicators for the level of economic efficiency. We find evidence that the level of economic efficiency has increased in the Dutch power market while the level of security of supply has maintained.
Keywords: deregulated energy markets, economic efficiency, indicators, balancing power market, balancing prices, balancing volumes dynamics
JEL Classification: M, G3, Q43
Suggested Citation: Suggested Citation