Integration of European Electricity Markets: Evidence from Spot Prices
Gugler K, Haxhimusa A, Liebensteiner M (2018)
Publication Language: English
Publication Type: Journal article
Publication year: 2018
Journal
Book Volume: 39
Pages Range: 41-66
DOI: 10.5547/01956574.39.SI2.kgug
Abstract
This paper investigates the current state of market integration among European electricity day-ahead spot prices. In our empirical analysis we utilize a large sample of hourly spot prices of 25 European markets for the period 2010Jan01/01h-2015Jun30/24h and combine it with other relevant data such as hourly interconnector capacities and the existence of market coupling. Firstly, empirical results from cointegration analysis indicate that market integration increased from 2010 to 2012 but then declined until 2015, despite the introduction of market coupling in many markets. Secondly, we empirically assess error correction after price shocks and reach the conclusion that markets' strength of the error correction mechanism is rather modest. In general, our findings suggest that the integration among European electricity markets has a large potential for improvements from additional capacity investments and further promotion of market coupling.
Authors with CRIS profile
Mario Liebensteiner
Juniorprofessur für Wirtschaftswissenschaften (Energiemärkte und Energiesystemanalyse)
Involved external institutions
Austria (AT)How to cite
APA:
Gugler, K., Haxhimusa, A., & Liebensteiner, M. (2018). Integration of European Electricity Markets: Evidence from Spot Prices. Energy Journal, 39, 41-66. https://dx.doi.org/10.5547/01956574.39.SI2.kgug
MLA:
Gugler, Klaus, Adhurim Haxhimusa, and Mario Liebensteiner. "Integration of European Electricity Markets: Evidence from Spot Prices." Energy Journal 39 (2018): 41-66.
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