فرصت های سرمایه گذاری، عدم اطمینان و تجدید پذیرها
Abstract
۱٫ Introduction
۲٫ Investment theory and empirical model
۳٫ Data
۴٫ Results
۵٫ Conclusions Appendix A. Merit order curves
Appendix B. Example of how we calculate q for E.ON
Appendix C. Additional tables
References
Abstract
We investigate investment decisions in electricity generation technologies under uncertainty. The econometric analysis is based on a vast dataset of electricity generation capacities of virtually all European power plants, which we combine with disaggregated measures of investment opportunities and uncertainty. Our approach allows for a disaggregated analysis at the asset level (i.e. different electricity generation technologies) of the firm. Across technologies, we find investment to follow market incentives despite sunk and irreversible capital, confirming the implications of the Tobin’s q-model. Asset-specific uncertainty hinders investment in conventional technologies, especially in peak-load assets, while industry uncertainty even triggers investment. Given that renewable power replaces peak-load generation technologies and that investment incentives decrease over time, our results indicate that there may be under-investment in the long run.
Introduction
Investments in electricity generation capacity are irreversible, sunk, and generally take considerable time to build. Moreover, in the last decade European electricity markets have been characterized by a transition towards decarbonization with significant government intervention. Electricity prices have decreased significantly and the system has become more volatile as a result (Sinn, 2017). During times of high renewables production, residual demand for conventional generation technologies drops, decreasing their capacity utilization and profitability. This may withhold large-scale investments, and may eventually create a ‘missing money problem’ for investment in conventional technologies (Joskow, 2007). Conventional technologies, however, are still needed as a backup for intermittent renewables and other low-carbon technologies to ensure supply security. Understanding the main determinants of electricity generation-capacity investment bears thus importance beyond academia, since electricity is one of the keys to the success of the energy transition to a decarbonized system as a response to climate change.