Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/68049
Authors: 
Malaguzzi Valeri, Laura
Year of Publication: 
2008
Series/Report no.: 
Working Paper, The Economic and Social Research Institute (ESRI), Dublin 232
Abstract: 
This study analyzes the effects of additional interconnection on welfare and competition in the Irish electricity market. I simulate the wholesale electricity markets of Great Britain and the island of Ireland for 2005. I find that in order for the two markets to be integrated in 2005, additional interconnection would have to be large. The amount of interconnection decreases for high costs of carbon, since this causes the markets to become more similar. Irish consumers obtain most of the welfare gains of interconnection. As the amount of interconnection increases, there are also positive effects on competition in Ireland, the less competitive of the two markets. Finally, it is unlikely that private investors will pay for the construction of the interconnector since they are unable to extract all its welfare benefits.
Subjects: 
interconnection
electricity
Ireland
JEL: 
L94
Q40
Document Type: 
Working Paper

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