ECN380 Energy Markets and Regulation

The course covers central issues concerning energy markets and economic regulation in the energy sector. Specific topics include: 1) organization of energy markets; 2) regulatory, operational and commercial aspects of electricity markets; 3) regulation of network providers through dynamic yardstick competition; 4) measuring efficiency with DEA (data envelopment analysis) and SFA (stochastic frontier analysis); 5) efficient and equitable pricing in the energy sector, and 6) energy security. Challenges to organization and regulation of energy markets from new renewable resources, emerging technologies and new business models.

Knowledge

• has detailed knowledge of electricity market structures, design and regulation in different countries
• has good knowledge about the key economic models behind electricity market design
• has knowledge about the basic optimization models used for electricity market design
• has good knowledge about the key economic models used for regulating natural monopolies
• has a deep understanding of how the efficiency of the electricity market depends upon the design and interaction of mechanisms for energy trade, ancillary services, congestion management, risk management, environmental measures, and regulatory policies.

Skills

• can identify and explain the specific market mechanisms necessary in an electricity market, i.e. mechanisms for energy trade, ancillary services, congestion management, risk management, environmental measures, and regulatory policies.
• can analyze, compare and discuss differences in chosen structure and electricity market design in different countries.
• can describe, design and implement efficiency-based regulation of natural monopolies

General knowledge

• has detailed knowledge about price setting and the key factors influencing electricity prices
• has the knowledge necessary to understand and assess different proposed policies and measures aiming at e.g. further efficiency, the integration of new technologies, and environmental protection in the energy sector
• can professionally communicate the principles and the rationale behind price setting in electricity markets
• can professionally communicate analysis, results, and opinions about electricity market design and regulation.