Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/100097
Authors: 
Grossi, Luigi
Heim, Sven
Waterson, Michael
Year of Publication: 
2014
Series/Report no.: 
ZEW Discussion Papers 14-051
Abstract: 
The German response to the Fukushima nuclear power plant incident was possibly the most significant change of policy towards nuclear power outside Japan, leading to a sudden and very significant shift in the underlying power generation structure in Germany. This provides a very useful natural experiment on the impact of increasing proportions of renewable compared to conventional fuel inputs into power production, helping us to see how changed proportions in future as a result of policy moves in favour of renewables are likely to impact. We find through quasi-experimental exploration of a modified demand-supply framework that despite the swift, unpredicted change, the main impact was a significant increase in prices, partly caused by more frequent situations with unilateral market power. The price impact was also most significant in off-peak hours, leading to changed investment incentives. There were no appreciable quantity effects on the market, such as power outages, contrary to some views that the impacts would be significant. Furthermore, we find the sudden and unilateral phase-out decision by the German government has significantly affected electricity prices and thus competitiveness in neighbouring countries.
Subjects: 
electricity markets
Atomausstieg
German power market
nuclear outages
renewables
JEL: 
L51
L94
Q41
Q48
Q54
Document Type: 
Working Paper

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