Handbook on Electricity Markets

Edited by Jean-Michel Glachant, Professor, Florence School of Regulation, EUI, Florence and Advisor, Technology University POLITO, Turin, Italy, Paul L. Joskow, Elizabeth and James Killian Professor of Economics Emeritus, Department of Economics, Massachusetts Institute of Technology, US and Michael G. Pollitt, Professor of Business Economics, Judge Business School, University of Cambridge, UK

• Contents:1 Introduction to the Handbook on Electricity Markets 1Jean-Michel Glachant, Paul L. Joskow and Michael G. PollittPART I TAKING STOCK: THE LEGACY2 Strengths and weaknesses of traditional arrangements for electricity supply 13Richard Schmalensee3 Optimal wholesale pricing and investment in generation: the basics 36Paul L. Joskow and Thomas-Olivier L.autier4 Wholesale electricity market design 73Frank A. Wolak5 The evolution of competitive retail electricity markets 111Stephen Littlechild6 Strengths and weaknesses of the British market model 156David Newbery7 Strengths and weaknesses of the PJM market model 182William W. Hogan8 ERCOT: success (so far) and lessons learned 205Ross Baldick, Shmuel S. Oren, Eric S. Schubert and Kenneth Anderson9 Lessons from Australia’s National Electricity Market 1998–2018: strengthsand weaknesses of the reform experience 242Paul Simshauser10 Strengths and weaknesses of the Nordic market model 287Chlo. Le Coq and Sebastian Schwenen11 The evolution of the European model for electricity markets 308Fabien RoquesPART II ADAPTING TO NEW TECHNOLOGIES AND NEW POLICYPRIORITIES12 New technologies on the supply side 332Nils May and Karsten Neuhoff13 New technologies on the demand side 353Fereidoon Sioshansi14 Tools and policies to promote decarbonization of the electricity sector 383Kathryne Cleary, Carolyn Fischer and Karen Palmer15 Shifting supply as well as demand: the new economics of electricity with highrenewables 408Richard Green16 The future design of the electricity market 428Michael G. Pollitt17 New business models in the electricity sector 443Jean-Michel Glachant18 Electrifying transport: issues and opportunities 463Bentley C. Clinton, Christopher R. Knittel and Konstantinos Metaxoglou19 Electrification of residential and commercial heating 506Mathilde Fajardy and David M. Reiner20 Harnessing the power of integration to achieve universal electricity access:the case for the Integrated Distribution Framework 540Ignacio J. P.rez-Arriaga, Divyam Nagpal, Gr.goire Jacquot and Robert Stoner21 Reforming China’s electricity industry: national aspiration, bureaucraticempires, local interests 568Xu Yi-chong22 The evolution of electricity sectors in Africa: ongoing obstacles and emergingopportunities to reach universal targets 595Vivien Foster, Anton Eberhard and Gabrielle DysonIndex 629

'The electricity sector - the backbone of the modern economy - is under tremendous pressure right now. Because of climate change, it is being asked to both grow at a much faster pace than it has historically and, at the same time, fundamentally transform its operations. There is no better time for a comprehensive volume with an all-star list of contributors - hats off to Glachant, Joskow and Pollitt.'