Who should own a renewable technology? Ownership theory and an application

Talat S. Genc, Stanley S Reynolds

Research output: Contribution to journalArticle

2 Citations (Scopus)

Abstract

We investigate the market implications of ownership of a new low-cost production technology. We relate our theoretical findings to measure the impact of renewable energy penetration into electricity markets and examine how the ownership of renewable capacity changes market outcomes (prices, outputs, emissions). As current public policies influence renewable energy ownership, this research provides useful insights for policy makers. We show how and why ownership of renewable capacity matters when there is market power in energy market. We apply our findings to the wholesale electricity market in Ontario, Canada, to analyze the impact of different ownership structures for wind capacity expansions. Using both simulation analysis and empirical analysis of market data, we show that the price-reducing effects of wind expansion are smaller when a larger strategic firm owns new wind capacity. Lastly, we show that the effect of wind ownership on emissions depends on both the amount of generation displaced by wind output and the emissions rate of displaced generation.

Original languageEnglish (US)
Pages (from-to)213-238
Number of pages26
JournalInternational Journal of Industrial Organization
Volume63
DOIs
StatePublished - Mar 1 2019

Fingerprint

Ownership
Costs
Electricity market
Renewable energy
Power markets
Energy market
Ownership structure
Penetration
Ontario
Public policy
Empirical analysis
Market power
Politicians
Canada
Capacity expansion
Market data
Production technology
Simulation analysis
New firms

Keywords

  • Greenhouse gas emissions
  • Market structure
  • Renewable energy
  • Technology ownership

ASJC Scopus subject areas

  • Industrial relations
  • Engineering (miscellaneous)
  • Economics and Econometrics
  • Economics, Econometrics and Finance (miscellaneous)
  • Strategy and Management

Cite this

Who should own a renewable technology? Ownership theory and an application. / Genc, Talat S.; Reynolds, Stanley S.

In: International Journal of Industrial Organization, Vol. 63, 01.03.2019, p. 213-238.

Research output: Contribution to journalArticle

@article{84d4793db2ae4a1d9ff3e57ae6f91ebb,
title = "Who should own a renewable technology? Ownership theory and an application",
abstract = "We investigate the market implications of ownership of a new low-cost production technology. We relate our theoretical findings to measure the impact of renewable energy penetration into electricity markets and examine how the ownership of renewable capacity changes market outcomes (prices, outputs, emissions). As current public policies influence renewable energy ownership, this research provides useful insights for policy makers. We show how and why ownership of renewable capacity matters when there is market power in energy market. We apply our findings to the wholesale electricity market in Ontario, Canada, to analyze the impact of different ownership structures for wind capacity expansions. Using both simulation analysis and empirical analysis of market data, we show that the price-reducing effects of wind expansion are smaller when a larger strategic firm owns new wind capacity. Lastly, we show that the effect of wind ownership on emissions depends on both the amount of generation displaced by wind output and the emissions rate of displaced generation.",
keywords = "Greenhouse gas emissions, Market structure, Renewable energy, Technology ownership",
author = "Genc, {Talat S.} and Reynolds, {Stanley S}",
year = "2019",
month = "3",
day = "1",
doi = "10.1016/j.ijindorg.2018.10.007",
language = "English (US)",
volume = "63",
pages = "213--238",
journal = "International Journal of Industrial Organization",
issn = "0167-7187",
publisher = "Elsevier Inc.",

}

TY - JOUR

T1 - Who should own a renewable technology? Ownership theory and an application

AU - Genc, Talat S.

AU - Reynolds, Stanley S

PY - 2019/3/1

Y1 - 2019/3/1

N2 - We investigate the market implications of ownership of a new low-cost production technology. We relate our theoretical findings to measure the impact of renewable energy penetration into electricity markets and examine how the ownership of renewable capacity changes market outcomes (prices, outputs, emissions). As current public policies influence renewable energy ownership, this research provides useful insights for policy makers. We show how and why ownership of renewable capacity matters when there is market power in energy market. We apply our findings to the wholesale electricity market in Ontario, Canada, to analyze the impact of different ownership structures for wind capacity expansions. Using both simulation analysis and empirical analysis of market data, we show that the price-reducing effects of wind expansion are smaller when a larger strategic firm owns new wind capacity. Lastly, we show that the effect of wind ownership on emissions depends on both the amount of generation displaced by wind output and the emissions rate of displaced generation.

AB - We investigate the market implications of ownership of a new low-cost production technology. We relate our theoretical findings to measure the impact of renewable energy penetration into electricity markets and examine how the ownership of renewable capacity changes market outcomes (prices, outputs, emissions). As current public policies influence renewable energy ownership, this research provides useful insights for policy makers. We show how and why ownership of renewable capacity matters when there is market power in energy market. We apply our findings to the wholesale electricity market in Ontario, Canada, to analyze the impact of different ownership structures for wind capacity expansions. Using both simulation analysis and empirical analysis of market data, we show that the price-reducing effects of wind expansion are smaller when a larger strategic firm owns new wind capacity. Lastly, we show that the effect of wind ownership on emissions depends on both the amount of generation displaced by wind output and the emissions rate of displaced generation.

KW - Greenhouse gas emissions

KW - Market structure

KW - Renewable energy

KW - Technology ownership

UR - http://www.scopus.com/inward/record.url?scp=85058029503&partnerID=8YFLogxK

UR - http://www.scopus.com/inward/citedby.url?scp=85058029503&partnerID=8YFLogxK

U2 - 10.1016/j.ijindorg.2018.10.007

DO - 10.1016/j.ijindorg.2018.10.007

M3 - Article

AN - SCOPUS:85058029503

VL - 63

SP - 213

EP - 238

JO - International Journal of Industrial Organization

JF - International Journal of Industrial Organization

SN - 0167-7187

ER -