The aim of this study is to examine how the EU ETS price has affected the price of electricity in the Nordic electricity market, and how future changes in the carbon price may affect the wholesale electricity prices. The Nordic countries included are Sweden, Norway, Denmark and Finland. The analysis builds on a reduced econometric model where the Nordic electricity price constitutes the dependent variable. Problem with autocorrelation implied that quarterly data rather than monthly data were used. This model is estimated using ordinary least square (OLS) regression technique. Four variables were found to be statistically significant. These include the EU ETS price, the hydro reservoir level, the coal price and the temperature. The estimated coefficients were used to conduct a simulation on what could happen if the EU ETS price increased to € 30 per ton. The results showed that the electricity price would than increase by about € 16 per MWh from its current level at about € 37 per MWh.
| Identifer | oai:union.ndltd.org:UPSALLA1/oai:DiVA.org:ltu-71421 |
| Date | January 2018 |
| Creators | Eriksson, Andreas |
| Publisher | Luleå tekniska universitet, Institutionen för ekonomi, teknik och samhälle |
| Source Sets | DiVA Archive at Upsalla University |
| Language | English |
| Detected Language | English |
| Type | Student thesis, info:eu-repo/semantics/bachelorThesis, text |
| Format | application/pdf |
| Rights | info:eu-repo/semantics/openAccess |
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