Rahmat Poudineh

Lead Senior Research Fellow

Rahmat joined the institute in November 2014 to design and lead the electricity research programme. Rahmat is an economist and engineer by training, with several years of experience in the economics and regulation of the electricity sector. He has published numerous peer-reviewed academic articles on a number of key issues relating to the energy  sector, including: network regulation, electricity market design, power system flexibility, renewable support schemes, gas and power interdependence,  power sector reform in developing countries, and the implications of the energy transition for oil companies. He has also co-authored a book on ‘The Economics of Offshore Wind Power: Challenges and Policy Considerations’. Rahmat’s main research interest lies in the design of markets and regulation for future decarbonised energy systems.

Rahmat has been involved in a number of policy oriented projects, including a European Commission funded project on developing a regulatory framework to ensure the security of the European power grid against natural, accidental and malicious damage. He also led a project on sustainable electricity pricing for Tanzania funded by International Growth Centre (IGC).

Rahmat holds a BSc in aerospace engineering from Amirkabir University of Technology (Tehran Polytechnic), a graduate diploma in economics from Queen Mary University of London, MSc in energy economics and policy from University of Surrey, and PhD in energy economics from Durham University, where he received the best thesis prize for his doctoral dissertation on economic regulation of electricity distribution networks.

Areas of Expertise
Energy sector reform and market liberalisation, Regulatory economics, Theoretical and applied microeconomics, Electricity market design, Electricity networks regulation, Renewable policy, Energy technology and Innovation

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Australia’s National Electricity Market is an important global test case of the impacts of electricity sector transition in a large-scale liberalized energy-only market. The integration of variable and distributed energy resources has provided opportunities for clean, low-cost generation, but has also challenged existing market frameworks and resulted in a debate about the necessity for new designs. The market’s delayed and insufficient response to disorderly retirement and the need for certain system services have resulted in government and system operator intervention to bridge the gap. There are difficulties in securing timely new investment under policy uncertainty and integrated capital models. Furthermore, contributions to system services that were previously provided as a consequence of energy provision are not inherently provided by many new-generation technologies. A range of solutions have been proposed to address these challenges, although none to date have harnessed the potential of comprehensive alignment between operational requirements and economic signals. For example, the government’s flagship National Energy Guarantee, while providing a new framework for emissions intensity and reliability, did not address the ‘missing markets’ in energy security. Measures such as forward markets may provide hedging options, but are limited to energy. Centralized commitment could provide operating robustness, but might not be able to provide sufficient transparency of the various electricity value streams, as the experience of international markets shows. Furthermore, while reliability has taken centre stage in the policy discourse, system security is as important in managing a large-scale complex grid with a significant share of asynchronous generation. We argue that an efficient and transparent real-time energy market must reflect the comprehensive operational requirements of electricity dispatch. This necessitates an extension of energy-only design to an ‘energy+services’ model in which efficient price signals are provided for the ‘missing products’ necessary for operational security. Clear service specifications provide transparent signals that enable clear price discovery and facilitate competition from new providers and technologies.

[post_title] => Electricity Sector Transition in the National Electricity Market of Australia: Managing Reliability and Security in an Energy-Only Market [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => electricity-sector-transition-national-electricity-market-australia-managing-reliability-security-energy-market [to_ping] => [pinged] => [post_modified] => 2018-11-05 11:32:34 [post_modified_gmt] => 2018-11-05 11:32:34 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=31255 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [1] => WP_Post Object ( [ID] => 31235 [post_author] => 111 [post_date] => 2018-10-16 10:38:30 [post_date_gmt] => 2018-10-16 09:38:30 [post_content] => In the face of challenges to energy-only market design under the electricity sector transition, an option considered by many jurisdictions is to incorporate some form of centralized capacity mechanism to respond to shortfalls in the market provision. For example, the UK government has already introduced a formal capacity market. In Germany and Belgium, strategic reserve mechanisms have already been approved and will be introduced shortly. Other markets, such as the National Electricity Market of Australia, are also considering enhancing their existing strategic reserve mechanisms, which would see more standardized and continual procurement of capacity by a noncommercial central agency. Under a market transition where generation is increasingly stochastic and decentralized, two key issues emerge with the above approaches. First, centralized mechanisms put increased focus on the efficiency of central authority decision making and the alignment between performance outcomes for reliability and agency incentives. Second, existing capacity mechanisms require the central agency to infer consumer preferences for reliability, something that is very challenging in practice. This is especially relevant in markets where the value of lost load is increasingly differentiated among different consumers. In this paper, we propose a new model for electricity market design—the insurer-of-last-resort model—that works as a risk overlay on an existing energy-only market. This model unbundles energy and reliability and incorporates insurance-based risk management concepts with the aims of (1) aligning incentives for centralized decision making and (2) allowing revealed consumer preferences to guide new capacity deployment. [post_title] => Decarbonized Market Design: An Insurance Overlay on Energy-Only Electricity Markets [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => decarbonized-market-design-insurance-overlay-energy-electricity-markets [to_ping] => [pinged] => [post_modified] => 2018-10-16 10:38:30 [post_modified_gmt] => 2018-10-16 09:38:30 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=31235 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [2] => WP_Post Object ( [ID] => 31095 [post_author] => 111 [post_date] => 2018-06-25 10:45:16 [post_date_gmt] => 2018-06-25 09:45:16 [post_content] => Resource-rich economies in the Middle East and North Africa (MENA) are pursuing two parallel strategies with regard to their electricity sectors: (i) increasing the role of renewables and integrating them into their power generation mix to mitigate the impact of rising domestic oil and gas demand on their economies and to boost their hydrocarbon export capacities; and (ii) conducting power sector reforms to attract investment in generation capacity and networks, remove subsidies, and improve operational efficiency. These goals imply that the design of power sector reforms (including regulations governing wholesale and retail markets and networks) needs to be carried out with a view to the possibility of a rising share of non-dispatchable resources. The lack of an integrated approach to simultaneously address these two strategies is likely to lead to several misalignments between renewables and the various components of future electricity markets, when the share of intermittent resources increases in the generation mix. The key challenge is that the ‘ultimate model’ that will reconcile these two goals (liberalization and integrating renewables) is as yet unknown, and is still evolving due to uncertainties around the development of technologies, institutions, and consumer preferences. We argue in this paper that resource-rich MENA countries can, however, move towards adopting a transition model of electricity markets, the individual elements of which can eventually be adapted to suit either centralized or decentralized future electricity sector outcomes. We outline the key components of this model for the wholesale market, retail market, and network regulation, considering the objectives of governments and the specific contexts of the region.​   [post_title] => Electricity Markets in MENA: Adapting for the Transition Era [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => electricity-markets-mena-adapting-transition-era [to_ping] => [pinged] => [post_modified] => 2018-06-21 13:01:32 [post_modified_gmt] => 2018-06-21 12:01:32 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=31095 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [3] => WP_Post Object ( [ID] => 31065 [post_author] => 111 [post_date] => 2018-05-29 10:58:01 [post_date_gmt] => 2018-05-29 09:58:01 [post_content] => The energy landscape is changing rapidly with far-reaching implications for global energy industries and actors, including oil companies and oil-exporting countries. These rapid changes introduce uncertainty in multiple dimensions, the most important of which is the speed of transition.  While the transformation of energy systems is rapid in certain regions of the world, such as Europe, the speed of global energy transition remains uncertain. It is also difficult to define the end game (which technology will win and what the final energy mix will be), as the outcome of transition will vary across regions. A key issue facing oil companies and oil-exporting countries is how they should now position themselves and how best to be part of the renewables ‘revolution’. For oil companies, moving beyond their core business is risky, but a ‘wait-and-see' strategy could be costly, therefore oil companies need to gradually ‘extend’ their business model and rather than a complete shift from hydrocarbons to renewables, they should aim to build an integrated portfolio which includes both hydrocarbon and low-carbon assets. The strategies designed to make this happen need to be flexible and able to evolve quickly in response to anticipated changes in the market. For oil-exporting countries, with subsidized prices and rising domestic energy consumption, there is no conflict between investing in renewables and in hydrocarbons as these countries can liberate oil and gas for export markets, improving the economics of renewables projects. In the long run, however, the main challenge for many oil exporting countries is economic diversification as it is the ultimate safeguard against the energy transition. Whether or not these countries succeed in their goal of achieving a diversified economy has implications for global energy markets and the speed of global energy transformations. In other words, the global energy transition will not only shape political and economic outcomes in oil-exporting countries, but the transformations in these major oil-exporting countries will, in turn, shape the global energy transition - adding another layer of uncertainty to the already complex phenomenon of energy transition. [post_title] => The rise of renewables and energy transition: what adaptation strategy for oil companies and oil-exporting countries? [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => rise-renewables-energy-transition-adaptation-strategy-oil-companies-oil-exporting-countries [to_ping] => [pinged] => [post_modified] => 2018-06-05 14:00:22 [post_modified_gmt] => 2018-06-05 13:00:22 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=31065 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [4] => WP_Post Object ( [ID] => 30959 [post_author] => 111 [post_date] => 2018-04-03 12:49:24 [post_date_gmt] => 2018-04-03 11:49:24 [post_content] => Competitive tendering has become one of the preferred methods of contracting renewable energy generation capacity internationally. As of early 2015, at least 60 countries had adopted renewable energy tenders, compared to just six countries in 2005. However, there are limited country-specific comparisons which research the subject considering the importance and prominence of the issue. The aim of this study is to fill this research gap by examining the Brazilian and Mexican experiences in developing renewables and how their tendering programmes interact with the market and institutional frameworks in which they exist. Fundamentally, our study seeks to shed light on two simple questions: what auction design issues may serve as barriers to renewable development, and how can auctions be improved further? We provide a historical assessment of renewable and generation capacity development policies in both Brazil and Mexico, review auction design and results in both countries, and offer recommendations for the future design and implementation of renewable energy policy tools, and auctions in particular. Executive Summary [post_title] => Renewable Auction Design in Theory and Practice: Lessons from the Experiences of Brazil and Mexico [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => renewable-auction-design-theory-practice-lessons-experiences-brazil-mexico [to_ping] => [pinged] => [post_modified] => 2018-04-03 12:51:22 [post_modified_gmt] => 2018-04-03 11:51:22 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=30959 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [5] => WP_Post Object ( [ID] => 30783 [post_author] => 111 [post_date] => 2017-12-14 15:10:11 [post_date_gmt] => 2017-12-14 15:10:11 [post_content] => While the economics of low carbon generation technologies is fast improving due to a mix of policy and market driven incentives, innovation in electricity networks has been relatively sluggish. This slow adaptation of electricity networks is challenging as they are key to the energy transition. Further electrification of the economy requires significant investment and innovation in the grid segment of the electricity supply chain.  Traditional regulatory models of natural monopoly network utilities are designed to incentivise cost efficiency, with the assumption that network business is costly and the task of regulation is to encourage cost reduction subject to firm achieving a certain level of reliability. A feature of innovation activities is that they are riskier in comparison with the business-as-usual activities of network firms. This paper reviews the evolution of electricity grids from the technological and organisational perspectives and analyses the efficacy of existing incentive models in encouraging innovation.  We show that incentive mechanisms that do not take uncertainty into account in the outcome of innovation efforts divert the attention of network utilities from innovation to normal efficiency gains. We also demonstrate that the issue of risk can distort the outcome of a competitive scheme for innovation funds when bidders are heterogeneous in their risk tolerance. Finally, based on the results of our analysis about the role of risk in innovation activities and a review of innovation incentive mechanisms in the UK and Italy, we provide recommendations for addressing the problem of innovation under regulation. Executive Summary [post_title] => Electricity Networks: Technology, Future Role and Economic Incentives for Innovation [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => electricity-networks-technology-future-role-economic-incentives-innovation [to_ping] => [pinged] => [post_modified] => 2017-12-14 15:10:11 [post_modified_gmt] => 2017-12-14 15:10:11 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=30783 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [6] => WP_Post Object ( [ID] => 30695 [post_author] => 111 [post_date] => 2017-10-26 12:06:14 [post_date_gmt] => 2017-10-26 11:06:14 [post_content] => In recent years, the debate on electricity market design in the EU has focused on the fitness-for-purpose of the existing dominant design, the appropriateness of energy policy that underpins the existing market design, and on the process through which energy policy is coordinated with market design. In this paper, we contribute to this debate on all three levels. First, we propose a ‘module-and-level’-based framework to illustrate our diagnosis of coordination issues present in the EU’s power markets. We apply this framework to make a systematic identification of existing misalignments between the components of current market design and physical RES integration/financial RES support schemes. Secondly, we argue that the role of energy policy is not just in managing existing trade-offs between competitiveness, sustainability, and reliability, but also in encouraging innovations that increase the compatibility of energy policy objectives in the future. Finally, we propose a seven-step condition-dependent evolution of power market design, where the government/regulatory authority plays the role of meta-coordinator, matching the adaptation of market-based coordination modules with a hybrid future where distributed energy resources coexist with centralised generation, while decentralised market participants trade with each other and with incumbents. Executive Summary [post_title] => Electricity market design for a decarbonised future: An integrated approach [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => electricity-market-design-decarbonised-future-integrated-approach [to_ping] => [pinged] => [post_modified] => 2017-11-16 11:44:09 [post_modified_gmt] => 2017-11-16 11:44:09 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=30695 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [7] => WP_Post Object ( [ID] => 30167 [post_author] => 111 [post_date] => 2017-03-06 10:56:05 [post_date_gmt] => 2017-03-06 10:56:05 [post_content] => In a recent paper we provide a comprehensive analysis of the gas to power supply chains in Nigeria and Bangladesh. This short article draws on the results of that study. In response to the dual challenge of decarbonisation and advancing energy access, some developing countries that are endowed with domestic natural gas resources have embarked on the path to develop a gas-to-power supply chain. Nigeria and Bangladesh, two of the most populous countries in the world, have adopted such a strategy. This paper uses a multi-step approach to evaluate the performance of the gas-to-power supply chains in these countries within political, regulatory, and commercial dimensions. The goal is to offer insights for other developing countries which are pursuing or considering the same strategy. By analysing the causal dynamics that are in place in Bangladesh and Nigeria, it suggests measures that may improve gas-to-power supply chain performance. Finally, it discusses the extent to which the causal dynamics observed can be generalised to other countries. Full paper. [post_title] => Gas-to-Power Supply Chains in Developing Countries: Comparative Case Studies of Nigeria and Bangladesh [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => gas-power-supply-chains-developing-countries-comparative-case-studies-nigeria-bangladesh [to_ping] => [pinged] => [post_modified] => 2017-11-16 14:22:12 [post_modified_gmt] => 2017-11-16 14:22:12 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=30167 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [8] => WP_Post Object ( [ID] => 30084 [post_author] => 111 [post_date] => 2017-02-13 11:52:40 [post_date_gmt] => 2017-02-13 11:52:40 [post_content] => Renewables in the resource-rich countries of the Middle East and North Africa (MENA) are inconsequential contributors to regional total primary energy supply, but recent project developments and overt support from a range of influential regional actors suggest a general trend towards a more environmentally sustainable electricity supply. This trend is driven just as much by economics as other factors, as rapidly falling renewable energy capital costs are complementing favourable policy environments, technical suitability, and concerns around the impacts of anthropogenic climate change. Finance is an especially important consideration in this transition, yet it receives insufficient coverage. This paper seeks to remedy this deficiency of academic inquiry. At the root of our inquiry lies a simple pair of questions: what makes a project financeable, and what can the resource-rich nations of the region do to create vibrant clean electricity financing markets for renewables? We outline the factors that affect the financeability of projects, review the latest developments in renewable energy finance in the region, and present policy recommendations going forward. Executive Summary [post_title] => Financing renewable electricity in the resource-rich countries of the Middle East and North Africa: A review [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => financing-renewable-electricity-middle-east-north-africa-review [to_ping] => [pinged] => [post_modified] => 2017-11-16 13:26:42 [post_modified_gmt] => 2017-11-16 13:26:42 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=30084 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [9] => WP_Post Object ( [ID] => 29685 [post_author] => 111 [post_date] => 2016-10-03 13:24:47 [post_date_gmt] => 2016-10-03 12:24:47 [post_content] =>

As much of the world pushes ahead with the deployment of renewable energy, resource-rich MENA economies are lagging behind. For the region to catch up, new policies are required to remove barriers of entry to the industry and create investment incentives. This paper contends that while the main obstacles to deployment of renewables are grid infrastructure inadequacy, insufficient institutional capacity, and risks and uncertainties, the investment incentives lie on a policy instrument spectrum with two polar solutions: (i) the incentive is provided entirely through the market (removing all forms of fossil fuel subsidies and internalising the cost of externalities); or (ii) the incentive is provided through a full government subsidy programme (in addition to the existing fossil fuel subsidies). However, there is a trade-off between the two dimensions of the fiscal burden and political acceptance across the policy instrument spectrum, which implies that the two polar solutions themselves are not easily and fully implementable in these countries. Therefore, we propose a combinatorial approach in which the incentive for renewables deployment is provided through a partial renewable subsidy program and partial fossil fuel price reform in a way that balances the fiscal pressure on the government against political acceptability. Additionally, the paper argues that the fact resource-rich countries are behind advanced economies in electricity sector reform gives them a last-mover advantage in the sense that they can tap into years of international experience to avoid design mistakes and create a sustainable solution that is compatible with renewables deployment and their own context.

Executive Summary

[post_title] => Advancing Renewable Energy in Resource-Rich Economies of the MENA [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => advancing-renewable-energy-resource-rich-economies-mena [to_ping] => [pinged] => [post_modified] => 2017-11-16 13:39:10 [post_modified_gmt] => 2017-11-16 13:39:10 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=29685 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [10] => WP_Post Object ( [ID] => 29390 [post_author] => 111 [post_date] => 2016-07-18 10:45:03 [post_date_gmt] => 2016-07-18 09:45:03 [post_content] => In a recent paper we investigate the problem of incentivising flexibility in electricity markets. As the share of intermittent renewable energy increases in the generation mix, power systems are exposed to greater levels of uncertainty and risk, which requires planners, policy and business decision makers to incentivise flexibility, that is: their adaptability to unforeseen variations in generation and demand. The greater need for flexibility, along with the fact that its provision is costly, highlights the importance of efficient procurement. As a commodity, flexibility has multiple attributes such as capacity, ramp rate, duration and lead time among which there are complementarities. Additionally, along with traditional sources, which already enable flexibility, a number of business models, such as thermostat-based demand response, aggregators and small storage providers, are emerging in electricity markets and expected to constitute important sources of flexibility in future decentralised power systems. However, due to presence of high transaction costs, relative to the size of resource, the emerging small resources cannot directly participate in an organised electricity market and/or compete. Therefore we ask the fundamental question of how should the provision of flexibility, as a multi-dimensional commodity, be incentivised in this context? We model the procurement of flexibility services from emerging small resources through bilateral contracts in a multidimensional adverse selection setting. We take a normative perspective and show how efficient contracts for flexibility services can be designed given its peculiarity as an economic commodity. Through a simulation analysis we elucidate the applicability of the proposed model and demonstrate the way it can be utilised in, for example, a thermostat based demand response programme. [post_title] => Flexibility-Enabling Contracts in Electricity Markets [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => flexibility-enabling-contracts-electricity-markets [to_ping] => [pinged] => [post_modified] => 2016-07-18 10:45:03 [post_modified_gmt] => 2016-07-18 09:45:03 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=29390 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [11] => WP_Post Object ( [ID] => 29354 [post_author] => 111 [post_date] => 2016-07-04 13:36:32 [post_date_gmt] => 2016-07-04 12:36:32 [post_content] => In order to fulfil its aspiration to become a middle-income country, Tanzania is working on improving infrastructure and service delivery in electricity provision, where $40 billion investment is needed in the sector to meet rising demand and widening electrification efforts from 2013 to 2035. This paper considers the institutional arrangements for investment in Tanzania’s power sector and surveys the track record (and possible bottlenecks) in funnelling investment to the sector, with special attention given to the gas sector, given the power sector’s planned reliance upon natural gas as a generation fuel. The paper finds that the financial health of TANESCO is central to all investment vehicles, since it is either directly responsible for investment, or indirectly, as the counter party to the variety of PPAs available with IPPs, EPPs, SPPs, or PPPs. During 2011–13, the financial position of TANESCO was negatively impacted by the increased of its electricity purchases, while the regulated tariff that it charges has not changed. The cost increase is partially attributable to non-favourable hydrology and partially attributable to the depreciation of Tanzanian shilling against the US dollar, in which PPAs are denominated. Detailed study of the tariff setting methodology in place in Tanzania, as evidenced through its latest tariff review, and evaluation of the ratemaking principles used in the tariff approved in 2013 reveals that the core tension within Tanzania’s tariff setting methodology is the trade-off between efficiency, sufficiency, and stability principles. The ex-ante assessment of TANESCO’s revenue requirement, a typical incentive-based price cap regulation, is theoretically efficient but not robust: TANESCO’s costs of service are subject to important external uncertainties like hydrology, currency depreciation, and global fuel prices. In order to take revenue sufficiency into account, the regulator needs to periodically adjust tariffs based on ex post fuel costs and inflation rates. This diminishes the regulator’s ability to maintain tariff stability, which might impact certain classes of customers more than others (lifeline rate customers and domestic industries). The experiences of other nations, namely Bangladesh and Côte d’Ivoire, reveal a potential challenge with regard to power and gas co-development: if non-cost reflective gas tariffs are applied as a regulatory decision, then high gas demand that results from that cannot be indefinitely sustained, since investment in gas supply will not follow suite. The case study of Côte d’Ivoire also reveals a less obvious opportunity: periods of low electricity demand can be leveraged positively through electricity exports, which can positively influence investor interest. Executive Summary [post_title] => Sustainable electricity pricing for Tanzania [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => susatainable-electricity-pricing-tanzania [to_ping] => [pinged] => [post_modified] => 2017-11-16 13:56:43 [post_modified_gmt] => 2017-11-16 13:56:43 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=29354 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [12] => WP_Post Object ( [ID] => 29338 [post_author] => 111 [post_date] => 2016-06-20 13:00:39 [post_date_gmt] => 2016-06-20 12:00:39 [post_content] => The complementarity between electricity systems of the north and south Mediterranean basin along with the need for diversification of energy resources and optimisation of energy systems are among the reasons for greater electricity trade and cross-border integration in the region. However, development of cross-border interconnection in the Mediterranean basin requires a business model which provides incentives for investment and efficient operation, manages risks and uncertainties and facilitates coordinated planning and governance. We contend that, due to high perceived risk of investment, delivery of interconnection projects through the EU regulated model is less likely, or only possible at prohibitively high rate of returns. The merchant transmission initiative (MTI), on the other hand, is seen as an exception under the EU laws and can be approved only if the project meets a set of strict conditions. We, therefore, advocate a hybrid business model in which the main benefits of a merchant model are maintained within a regulated structure. We highlight the main components of the proposed business model and show how it addresses the key features of a viable business model in relation to incentives, risks and governance. Our analysis demonstrates that the proposed Mediterranean business model for interconnection can better provide incentives for investment and is more compatible with the region’s energy scenario, governance structure and the risk attitude. Executive Summary [post_title] => Business model for cross-border interconnections in the Mediterranean basin [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => business-model-cross-border-interconnections-mediterranean-basin [to_ping] => [pinged] => [post_modified] => 2017-11-16 13:58:04 [post_modified_gmt] => 2017-11-16 13:58:04 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=29338 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [13] => WP_Post Object ( [ID] => 27314 [post_author] => 1 [post_date] => 2015-11-09 10:55:21 [post_date_gmt] => 2015-11-09 10:55:21 [post_content] => The increasing global use of natural gas for power generation has resulted in a period of interdependence between two important energy industries. Understanding of the extended gas-to-power supply chain is important for industry agents, power and gas system operators or integrated utilities, regulators, and government bodies responsible for overall energy policy. This paper seeks to align the study of gas and power industries by providing a holistic framework for the thorough identification and discussion of power and gas sector structure, infrastructure, market, and regulatory drivers. It acts as a lens through which the combined gas and power supply chains of any given country can be observed and understood. The gas-to-power supply chain of the United Kingdom is profiled to illustrate how the framework proposed can be applied to integrate the various dimensions of power and gas industries. Executive Summary [post_title] => A holistic framework for the study of interdependence between electricity and gas sectors [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => a-holistic-framework-for-the-study-of-interdependence-between-electricity-and-gas-sectors [to_ping] => [pinged] => [post_modified] => 2017-11-20 09:32:52 [post_modified_gmt] => 2017-11-20 09:32:52 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/wpcms/publications/a-holistic-framework-for-the-study-of-interdependence-between-electricity-and-gas-sectors/ [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [14] => WP_Post Object ( [ID] => 27320 [post_author] => 1 [post_date] => 2015-10-19 15:22:05 [post_date_gmt] => 2015-10-19 14:22:05 [post_content] => This paper follows on from ‘Saudi Arabia’s Oil Policy: More than Meets the Eye?’ published in June 2015, which raised a set of fundamental questions in relation to the sharp drop in the oil price between June 2014 and January 2015, and OPEC’s decision, spearheaded by Saudi Arabia, not to cut output in response. We develop a simple analytical framework, which formalizes Saudi Arabia’s decision-making process relative to the fundamental revenue maximization-market share trade-off in the 2014-15 oil price fall. Using a simple game, we show that under uncertainty, it is always better off for the Kingdom to assume shale oil supply is elastic and not to cut output. But we also argue that as Saudi Arabia learns more about this new source of supply, its policy will adapt accordingly. The fact Saudi Arabia’s oil policy could change as the trade-off between revenue maximization and market share evolves, and as new information is transmitted to the market, will keep the market second-guessing. It will continue to shape market expectations and influence market outcomes. Executive Summary [post_title] => The Dynamics of the Revenue Maximisation--Market Share Trade-off - Saudi Arabia's Oil Policy in the 2014--2015 Price Fall [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => the-dynamics-of-the-revenue-maximisation-market-share-trade-off-saudi-arabias-oil-policy-in-the-2014-2015-price-fall [to_ping] => [pinged] => [post_modified] => 2017-11-20 09:37:12 [post_modified_gmt] => 2017-11-20 09:37:12 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/wpcms/publications/the-dynamics-of-the-revenue-maximisation-market-share-trade-off-saudi-arabias-oil-policy-in-the-2014-2015-price-fall/ [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [15] => WP_Post Object ( [ID] => 27324 [post_author] => 1 [post_date] => 2015-09-01 12:47:04 [post_date_gmt] => 2015-09-01 11:47:04 [post_content] => The promise of carbon-free, utility-scale power generation from offshore wind farms is encouraging a number of governments to implement policy support frameworks and national targets for offshore wind power generation. However, the high capital requirements for the deployment of offshore wind have proven that it is an expensive approach to meeting national renewable energy and carbon reduction targets, relative to other power generation sources. The capital requirement for offshore wind farms will be pushed even higher as consented development zones move further from shore and into deeper waters. In this paper, we analyse the major capital cost drivers of offshore wind plants and the implications of various policy frameworks on overall cost reductions for the industry. According to the results of our analysis, this issue – whether the promotion of scalability, or of competition for subsidies, will be more effective in driving down industry-wide costs – is highly market specific. Competitive policies are likely to be most effective when the market size is sufficiently large, whereas enhancing scale is more effective in nascent markets. However, we caution that in either case, the public costs of policies directly supporting offshore wind must be reconciled with the cost of supporting other low-carbon and zero-carbon technologies that may be equally as effective in helping governments achieve renewable energy and carbon reduction targets. Executive Summary [post_title] => Achieving a cost-competitive offshore wind power industry - what is the most effective policy framework? [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => achieving-a-cost-competitive-offshore-wind-power-industry-what-is-the-most-effective-policy-framework [to_ping] => [pinged] => [post_modified] => 2017-11-20 09:38:27 [post_modified_gmt] => 2017-11-20 09:38:27 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/wpcms/publications/achieving-a-cost-competitive-offshore-wind-power-industry-what-is-the-most-effective-policy-framework/ [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [16] => WP_Post Object ( [ID] => 27327 [post_author] => 1 [post_date] => 2015-08-10 10:44:42 [post_date_gmt] => 2015-08-10 09:44:42 [post_content] => Ghana’s electricity generation capacity is currently insufficient to meet demand, making power outages and load shedding common. The resulting impact is potentially devastating for the country’s growth prospects. Traditionally, lack of an affordable and reliable fuel supply for power generation, coupled with ineffective institutions and an unfavourable investment climate, have resulted in Ghana’s electricity sector performing poorly. In light of the 2007 discovery of natural gas reserves in Ghanaian waters, this paper examines whether domestic gas could advance the performance of the electricity sector, and if so, how. The results of our analysis show that utilization of gas reserves in Ghana’s gas-to-power market is an economically superior strategy compared to an export-oriented utilization scheme. The lack of an effective regulatory framework for investment, skill shortages, and an inefficient electricity pricing structure continue to be the main constraining factors. Our analysis also considers possible approaches to modification of the electricity tariff in order to send the right signal to potential investors in generation capacity, without compromising the affordability of power supply. Executive Summary [post_title] => Gas-to-power market and investment incentive for enhancing generation capacity - an analysis of Ghana’s electricity sector [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => gas-to-power-market-and-investment-incentive-for-enhancing-generation-capacity-an-analysis-of-ghanas-electricity-sector [to_ping] => [pinged] => [post_modified] => 2017-11-20 09:40:31 [post_modified_gmt] => 2017-11-20 09:40:31 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/wpcms/publications/gas-to-power-market-and-investment-incentive-for-enhancing-generation-capacity-an-analysis-of-ghanas-electricity-sector/ [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [17] => WP_Post Object ( [ID] => 27361 [post_author] => 1 [post_date] => 2015-03-09 15:11:44 [post_date_gmt] => 2015-03-09 15:11:44 [post_content] => The distribution network is an important element of the power system that delivers electricity to the end-user. In the coming years a large amount of investment is envisioned in distribution system as these networks play a pivotal role in integration of renewable resources, demand side management and market competition, among other things. At the same time, network companies are regulated natural monopolies where their investment decisions are influenced by regulatory framework and intuitional constraints. There are various models of regulatory treatment of investment but the main objective of all is to ensure sufficiency and efficiency of investment. In this presentation with explore the relationship between investment and efficiency under incentive regulation with ex-post regulatory treatment of investment costs. [post_title] => Investment and efficiency in electricity networks [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => investment-and-efficiency-in-electricity-networks [to_ping] => [pinged] => [post_modified] => 2015-03-09 15:11:44 [post_modified_gmt] => 2015-03-09 15:11:44 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/wpcms/publications/investment-and-efficiency-in-electricity-networks/ [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [18] => WP_Post Object ( [ID] => 27370 [post_author] => 1 [post_date] => 2015-02-09 13:58:58 [post_date_gmt] => 2015-02-09 13:58:58 [post_content] => The power sector has a central role in modern economies and other interdependent infrastructures rely heavily upon secure electricity supplies. Due to interdependencies, major electricity supply interruptions result in cascading effects in other sectors of the economy. This paper investigates the economic effects of large power supply disruptions taking such interdependencies into account. We apply a dynamic inoperability input–output model (DIIM) to 101 sectors (including households) of the Scottish economy in 2009 in order to explore direct, indirect, and induced effects of electricity supply interruptions. We then estimate the societal cost of energy not supplied (SCENS) due to interruption, in the presence of interdependency among the sectors. The results show that the most economically affected industries, following an outage, can be different from the most inoperable ones. The results also indicate that SCENS varies with duration of a power cut, ranging from around £4300/MWh for a one-minute outage to around £8100/MWh for a three hour (and higher) interruption. The economic impact of estimates can be used to design policies for contingencies such as roll-out priorities as well as preventive investments in the sector. Executive Summary [post_title] => Electricity Supply Interruptions - Sectoral Interdependencies and the Cost of Energy Not Served for the Scottish Economy [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => electricity-supply-interruptions-sectoral-interdependencies-and-the-cost-of-energy-not-served-for-the-scottish-economy [to_ping] => [pinged] => [post_modified] => 2017-11-20 10:45:03 [post_modified_gmt] => 2017-11-20 10:45:03 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/wpcms/publications/electricity-supply-interruptions-sectoral-interdependencies-and-the-cost-of-energy-not-served-for-the-scottish-economy/ [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) ) [post_count] => 19 [current_post] => -1 [in_the_loop] => [post] => WP_Post Object ( [ID] => 31255 [post_author] => 111 [post_date] => 2018-11-01 11:17:57 [post_date_gmt] => 2018-11-01 11:17:57 [post_content] =>

Australia’s National Electricity Market is an important global test case of the impacts of electricity sector transition in a large-scale liberalized energy-only market. The integration of variable and distributed energy resources has provided opportunities for clean, low-cost generation, but has also challenged existing market frameworks and resulted in a debate about the necessity for new designs. The market’s delayed and insufficient response to disorderly retirement and the need for certain system services have resulted in government and system operator intervention to bridge the gap. There are difficulties in securing timely new investment under policy uncertainty and integrated capital models. Furthermore, contributions to system services that were previously provided as a consequence of energy provision are not inherently provided by many new-generation technologies. A range of solutions have been proposed to address these challenges, although none to date have harnessed the potential of comprehensive alignment between operational requirements and economic signals. For example, the government’s flagship National Energy Guarantee, while providing a new framework for emissions intensity and reliability, did not address the ‘missing markets’ in energy security. Measures such as forward markets may provide hedging options, but are limited to energy. Centralized commitment could provide operating robustness, but might not be able to provide sufficient transparency of the various electricity value streams, as the experience of international markets shows. Furthermore, while reliability has taken centre stage in the policy discourse, system security is as important in managing a large-scale complex grid with a significant share of asynchronous generation. We argue that an efficient and transparent real-time energy market must reflect the comprehensive operational requirements of electricity dispatch. This necessitates an extension of energy-only design to an ‘energy+services’ model in which efficient price signals are provided for the ‘missing products’ necessary for operational security. Clear service specifications provide transparent signals that enable clear price discovery and facilitate competition from new providers and technologies.

[post_title] => Electricity Sector Transition in the National Electricity Market of Australia: Managing Reliability and Security in an Energy-Only Market [post_excerpt] => [post_status] => publish [comment_status] => closed [ping_status] => closed [post_password] => [post_name] => electricity-sector-transition-national-electricity-market-australia-managing-reliability-security-energy-market [to_ping] => [pinged] => [post_modified] => 2018-11-05 11:32:34 [post_modified_gmt] => 2018-11-05 11:32:34 [post_content_filtered] => [post_parent] => 0 [guid] => https://www.oxfordenergy.org/?post_type=publications&p=31255 [menu_order] => 0 [post_type] => publications [post_mime_type] => [comment_count] => 0 [filter] => raw ) [comment_count] => 0 [current_comment] => -1 [found_posts] => 19 [max_num_pages] => 0 [max_num_comment_pages] => 0 [is_single] => [is_preview] => [is_page] => [is_archive] => 1 [is_date] => [is_year] => [is_month] => [is_day] => [is_time] => [is_author] => [is_category] => [is_tag] => [is_tax] => [is_search] => [is_feed] => [is_comment_feed] => [is_trackback] => [is_home] => [is_404] => [is_embed] => [is_paged] => [is_admin] => [is_attachment] => [is_singular] => [is_robots] => [is_posts_page] => [is_post_type_archive] => 1 [query_vars_hash:WP_Query:private] => 580bd265bcb92448ba12d5f9d12211cd [query_vars_changed:WP_Query:private] => [thumbnails_cached] => [stopwords:WP_Query:private] => [compat_fields:WP_Query:private] => Array ( [0] => query_vars_hash [1] => query_vars_changed ) [compat_methods:WP_Query:private] => Array ( [0] => init_query_flags [1] => parse_tax_query ) )

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