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Publications – Working Papers – Work in progress – Book Chapters and Policy Reports

Research Statement

Publications

Working Papers

We analyze the impact of the COVID-19 pandemic on electricity consumption patterns in Spain. We highlight the importance of decomposing total electricity consumption into consumption by firms and by households to better understand the economic and social impacts of the crisis. We also document a change in people’s daily routines in response to the stringency of the lockdown measures, as reflected in their hourly electricity consumption patterns.

We assess firms’ incentives to operate and invest in energy storage facilities under different market structures, including competitive and strategic storage owners in the cases in which the storage owner is integrated with a dominant electricity producer or it is a stand-alone firm. The results are key to understanding how to regulate energy storage, an issue which is critical for the deployment of renewables in electricity markets.

We assess the impact of facing producers to varying degrees of price exposure on the market power. This question is particularly relevant for the renewables’ policy debate, as regulators can decide whether to face renewable producers to full, partial, or no price exposure, an issue that affects the performance of power markets. To identify these effects empirically, we exploit a natural experiment that took place in the Spanish electricity market, that switched the type of contract faced by wind producers.

We analyse equilibrium bidding behaviour in uniform-price and discriminatory auctions in which each firm’s capacity is stochastic and is private information. We use the model to shed light on the performance of renewables-dominated electricity markets.

We compare the “degrowth” versus the “decoupling” strategies for carbon abatement by leveraging the COVID-19 crisis as a natural experiment. Our focus is on the Spanish economy, and in particular, on its power sector. The GDP loss (degrowth) gives an implicit cost of carbon in the thousands. Investing in renewables to achieve similar abatement would have an implicit cost of carbon closer to 57 Euros/Ton.

An imperfectly informed regulator needs to procure multiple units of a good that can be produced with heterogeneous technologies at various costs. Should she run technology-specific or technology-neutral auctions? We find that one size does not fit all: the preferred instrument depends on the nature of the available technologies, the extent of information asymmetry regarding their costs, the costs of public funds, and the degree of market power.

Work in Progress

  • “The Distributional Impacts of Real Time Pricing” (with M. Cahana, M. Reguant and J.Wang)

We examine the distributional impacts of RTP by leveraging on a country-wide field experiment which started in 2015, when RTP became the default option for most Spanish households. Our results suggest that the distributional impacts of RTP were quite small and, if anything, slightly progressive. We also find stronger differences in the impacts across regions than across income groups.

  • “On the Competitive Effects of Retention Strategies”

Retention offers allow firms to price discriminate across consumers with different willingness to switch: prices decrease for those consumers who are more likely to switch, but increase for those who are less likely to switch. In competitive markets, retention offers strengthen competitive pressure. However, if markets are not very competitive, they make them even less so.

Book Chapters

Fabra, N. and Motta, M. (2017) “Assessing Coordinated Effects in Merger Cases”
Handbook of Game Theory and Industrial Organization, (Corchon and Marini Eds.) Edward Elgar.

Policy Reports

In English:

In Spanish:

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