How different electricity pricing systems affect the energy trilemma: assessing Indonesia's electricity market transition.

Heffron, Raphael J.; Körner, Marc-Fabian; Sumarno, Theresia; Wagner, Jonathan; Weibelzahl, Martin; Fridgen, Gilbert

Abstract

Indonesia's current energy policy, which relies on cheap fossil fuels and focuses on two out of the three horns of the energy trilemma, namely, energy security and energy equity, may impede its efforts to higher shares of renewable energy sources. This paper develops three generic models that allow policymakers to analyze the impact of introducing a wholesale electricity market managed under either a nodal, a zonal, or a uniform pricing system on the three horns of the energy trilemma. It evaluates the models using a simplified network representation of the Indonesian electricity sector. The results indicate that under the model assumptions made, and given the used input parameters as well as the used metrics for the three horns of the energy trilemma, a uniform pricing system might help Indonesia to balance its energy trilemma.

Citation

HEFFRON, R.J., KÖRNER, M.-F., SUMARNO, T., WAGNER, J., WEIBELZAHL, M. and FRIDGEN, G. 2022. How different electricity pricing systems affect the energy trilemma: assessing Indonesia's electricity market transition. Energy economics [online], 107, article 105663. Available from: https://doi.org/10.1016/j.eneco.2021.105663

• Journal Article Type: Article
• Acceptance Date: Oct 23, 2021
• Online Publication Date: Oct 29, 2021
• Publication Date: Mar 31, 2022
• Deposit Date: Sep 24, 2022
• Publicly Available Date: Feb 2, 2023
• Journal: Energy economics
• Print ISSN: 0140-9883
• Electronic ISSN: 1873-6181
• Publisher: Elsevier
• Peer Reviewed: Peer Reviewed
• Volume: 107
• Article Number: 105663
• DOI: https://doi.org/10.1016/j.eneco.2021.105663
• Keywords: Electricity pricing system; Electricity market liberalization; Energy trilemma; Indonesia; Renewable energy sources
• Public URL: https://rgu-repository.worktribe.com/output/1763805