Removing cross-border capacity bottlenecks in the European natural gas market: A proposed merchant-regulatory mechanism

Arbeitspapier

We propose a merchant-regulatory framework to promote investment in the European natural gas network infrastructure based on a price cap over two-part tariffs. As suggested by Vogelsang (2001) and Hogan et al. (2010), a profit maximizing network operator facing this regulatory constraint will intertemporally rebalance the variable and fixed part of its two-part tariff so as to expand the congested pipelines, and converge to the Ramsey-Boiteaux equilibrium. We confirm this with actual data from the European natural gas market by comparing the bi-level price-cap model with a base case, a no-regulation case, and a welfare benchmark case, and by performing sensitivity analyses. In all cases, the incentive model is the best decentralized regulatory alternative that efficiently develops the European pipeline system.

Angaben zum Objekt

• Sprache: Englisch

Verweise und Beziehungen

• Erschienen in: Series: DIW Discussion Papers ; No. 1145

Klassifikation und Themen

• Klassifikation: Wirtschaft
• Thema: regulation ; transportation network ; investment ; Erdgasmarkt ; Gasleitungstransport ; Regulierung ; Ökonomischer Anreiz ; Europa

Beteiligte, Orts- und Zeitangaben

• Ereignis: Geistige Schöpfung
• (wer): Neumann, Anne ; Rosellón, Juan ; Weigt, Hannes
• Ereignis: Veröffentlichung
• (wer): Deutsches Institut für Wirtschaftsforschung (DIW)
• (wo): Berlin
• (wann): 2011

Weitere Informationen

• Handle: http://hdl.handle.net/10419/57259
• Letzte Aktualisierung: 10.03.2025, 11:43 MEZ