Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/192577 
Year of Publication: 
2009
Series/Report no.: 
Discussion Papers No. 595
Publisher: 
Statistics Norway, Research Department, Oslo
Abstract: 
This paper examines how ambitious climate policies and subsidies to carbon capture may affect international energy prices and market shares in the power market. A detailed numerical model of the international energy markets is used. We first conclude that an ambitious climate policy alone will have substantial effects in the power market, with considerable growth in renewable power production and eventually use of carbon capture. Gas power production will also benefit from such a policy. Subsidising carbon capture and storage (CCS) will significantly accelerate the use of this technology. Nevertheless, total production of coal and gas power (with or without CCS) is only marginally increased, as the subsidy mainly leads to installation of CCS equipment on existing plants, reducing the efficiency from these plants. Consequently, electricity prices are almost unchanged, and the substantial growth in renewable power production is hardly affected by the subsidies to CCS.
Subjects: 
Energy markets
Climate policy
Carbon capture
JEL: 
H23
Q40
Q54
Document Type: 
Working Paper

Files in This Item:
File
Size
314.7 kB





Items in EconStor are protected by copyright, with all rights reserved, unless otherwise indicated.