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dc.contributor.authorGeske, J.
dc.contributor.authorGreen, R.
dc.contributor.authorStaffell, I.
dc.date.accessioned2019-06-28T08:38:14Z
dc.date.available2019-06-28T08:38:14Z
dc.date.issued2019-04-12
dc.identifier.otherCWPE1947
dc.identifier.urihttps://www.repository.cam.ac.uk/handle/1810/294124
dc.description.abstractThe UK’s withdrawal from the European Union could mean that it leaves the EU Single Market for electricity (Elecxit). This paper develops methods to study the longer-term consequences of this electricity market disintegration, and in particular the end of market coupling. Before European electricity markets were coupled, different market closing times forced traders to commit to cross-border trading volumes based on anticipated market prices. Interconnector capacity was often under-used, and power sometimes flowed from high- to low-price areas. A model of these market frictions is developed, empirically verified on 2009 data (before market coupling) and applied to estimate the costs of market uncoupling in 2030. A less efficient market and the abandonment of some planned interconnectors would raise generation costs by €560m a year (1.5%) compared to remaining in the Single Electricity Market. Sixty percent (€300m) of these welfare losses occur in Great Britain.
dc.publisherFaculty of Economics, University of Cambridge
dc.relation.ispartofseriesCambridge Working Papers in Economics
dc.rightsAll Rights Reserved
dc.rights.urihttp://www.rioxx.net/licenses/all-rights-reserved/
dc.subjectElectricity Trading
dc.subjectMarket Coupling
dc.subjectBrexit
dc.titleElecxit: The Cost of Bilaterally Uncoupling British-EU Electricity Trade
dc.typeWorking Paper
dc.identifier.doi10.17863/CAM.41225


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