Burden allocation of climate policies in European power markets

The overall topic of the PhD project is the effects of climate policies in power markets. The thesis consists of 3 papers: - The impact of climate policies on the operation of thermal power plants - Short-term effects of long-term policies - what is the r eal effect of CO2 cost in power market? - Special interests in climate policies: The political economy of energy taxation Two of the papers focus on a technical feature of thermal power plants that has not been analysed in economics literature so far: t he start-up costs. The start-up costs introduce an intertemporal aspect in the production decision of a thermal power plant, and thus make the power plant less flexible than assumed by usual 'price vs. marginal cost' decision. The first paper analyses a s ingle producer's production decision - what are the effects of climate policies (CO2 cost and subsidies to renewables) on the power producer's production decision. Climate policies change parameters that determine the production decision. The second paper extends the analysis to the whole market: a market model is extended to include the start-up costs. The focus is on the market effects (prices, production and emissions) of CO2 cost when the start-up costs are accounted for. The third paper has a differ ent angle: it analyses the political economy of the energy taxation in Europe. This is an empirical analysis of energy taxation in selected European countries in the period 1980-2000 (the period when climate issues have been in focus to some extent). The goal is to identify which groups have been successful in lobbying related to energy taxation. By giving an indication of which policies are politically feasible, this could help in designing successful climate policies in the future.