Efficiency and Environmental Impacts of Electricity Restructuring on Coal-Fired Power Plants

Arbeitspapier

We investigate the impacts of electricity market restructuring on fuel efficiency, utilization and, new to this area, cost of coal purchases among coal-fired power plants using a panel data set from 1991 to 2005. Our study focuses exclusively on coal-fired power plants and uses panel data covering several years after implementation of restructuring. The estimation compares how investor-owned (IOs) plants in states with restructuring changed their behavior relative to IOs in states without. Our analysis finds that restructuring led to: (1) a two percent improvement in fuel efficiency for IOs, (2) a ten percent decrease in unit cost of heat input, and (3) a lower capacity factor even after adjusting for cross-plant generation re-allocation due to cost reductions. Based on these estimates, back-of-the-envelope calculations find that restructuring has led to about 6.5 million dollars in annual cost savings or nearly 12 percent of operating expenses and up to a 7.6 percent emissions reduction per plant.

Object Details

• Language: Englisch

References and Relationships

• Bibliographic citation: Series: CESifo Working Paper ; No. 4160

Classification and Topics

• Classification: Wirtschaft ; Regulation and Industrial Policy: General ; Energy: General ; Environmental Economics: General
• Subject: restructuring ; efficiency ; cost ; utilization ; emissions

Contributors, Places and Time

• Event: Geistige Schöpfung
• (who): Chan, H. Ron ; Fell, Harrison ; Lange, Ian A. ; Li, Shanjun
• Event: Veröffentlichung
• (who): Center for Economic Studies and ifo Institute (CESifo)
• (where): Munich
• (when): 2013

Further information

• Handle: http://hdl.handle.net/10419/71168
• Last update: 10.03.2025, 11:43 AM CET