Arbeitspapier

A Strategic Model of European Gas Supply (GASMOD)

Structural changes in the European natural gas market such as liberalization, increasing demand, and growing import dependency have triggered new attempts to model this market accurately. This paper presents a model of the European natural gas supply, GASMOD, which is structured as a two-stagegame of successive natural gas exports to Europe (upstream market) and wholesale trade within Europe (downstream market), and which explicitly includes infrastructure capacities. We compare three possible market scenarios: Cournot competition on both markets, perfect competition on both markets, and perfect competition on the downstream with Cournot competition on the upstream market. We find that Cournot competition on both markets is the most realistic representation of today?s European natural gas market, where suppliers at both stages generate a mark-up at the expense of the final customer (double marginalization). Our results yield a diversified supply portfolio with newly emerging (LNG) exporters gaining market shares. Enforcing perfect competition on the European downstream market would in positive welfare effects. The limited infrastructure strongly influences the results, and we identify bottlenecks mainly for intra-European trade relations whereas transport capacity on the upstream market is sufficient (with the exception of Norwegian exports) in the Cournot scenario.

Sprache
Englisch

Erschienen in
Series: DIW Discussion Papers ; No. 551

Klassifikation
Wirtschaft
Optimization Techniques; Programming Models; Dynamic Analysis
Gas Utilities; Pipelines; Water Utilities
Oligopoly and Other Imperfect Markets
Thema
natural gas
strategic behavior
non-linear optimization
Europe

Ereignis
Geistige Schöpfung
(wer)
Holz, Franziska
von Hirschhausen, Christian R.
Kemfert, Claudia
Ereignis
Veröffentlichung
(wer)
Deutsches Institut für Wirtschaftsforschung (DIW)
(wo)
Berlin
(wann)
2006

Handle
Letzte Aktualisierung
10.03.2025, 11:41 MEZ

Datenpartner

Dieses Objekt wird bereitgestellt von:
ZBW - Deutsche Zentralbibliothek für Wirtschaftswissenschaften - Leibniz-Informationszentrum Wirtschaft. Bei Fragen zum Objekt wenden Sie sich bitte an den Datenpartner.

Objekttyp

  • Arbeitspapier

Beteiligte

  • Holz, Franziska
  • von Hirschhausen, Christian R.
  • Kemfert, Claudia
  • Deutsches Institut für Wirtschaftsforschung (DIW)

Entstanden

  • 2006

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