Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/81500 
Year of Publication: 
2010
Series/Report no.: 
IFN Working Paper No. 838
Publisher: 
Research Institute of Industrial Economics (IFN), Stockholm
Abstract: 
The capacity of the transmission network determines the extent of integration of a multinational energy market. Cross-border externalities render coordination of network maintenance and investments across countries valuable. Is it then optimal to collect powers in the hands of a single regulator? Should a common system operator manage the entire network? I show that optimal network structure depends on (i ) how the common regulator would balance the interests of the different member states; (ii ) how the gains from market integration vary across countries; (iii ) network characteristics (substitutability versus complementarity); and (iv ) the social cost of operator rent.
Subjects: 
Multi-national Energy Market
Transmission
Supranational Regulation
System Operation
Multi-contracting
JEL: 
D62
D82
L51
L94
Document Type: 
Working Paper

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