Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/226807 
Year of Publication: 
2020
Series/Report no.: 
ifo Working Paper No. 343
Publisher: 
ifo Institute - Leibniz Institute for Economic Research at the University of Munich, Munich
Abstract: 
We use the cross-impact balance analysis to develop narratives that differ in the level of political collaboration (in terms of the stringency of the EU climate policy) and physical collaboration (possible expansion of transmission capacity between countries) in the European power market. Applying a CGE model and two power market models, we quantify the impact of the two dimensions on emission, abatement cost, and electricity prices until 2050. The most collaborative narrative leads to CO2 emissions of 90 to 139 Mt, abatement cost of 245 to 271 EUR/ton CO2, and prices of 56 to 67 EUR/MWh in 2050. The least collaborative one has emissions of 848 to 1013 Mt, cost of 378 to 559 EUR/ton, and prices of 47 to 57 EUR/MWh. In all narratives, countries at the periphery of the European market tend to experience lower prices and abate more, whereas prices are higher and abatement lower in central and Southeast Europe.
Subjects: 
collaboration
energy transition
decarbonization
European power market
transmission
renewable energy
energy system modeling
JEL: 
C61
C68
Q40
Q41
Document Type: 
Working Paper

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