Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries

The aim of this paper is to measure the impact of certain factors on the formation of the price of electricity, which is obtained from conventional and renewable energy sources, in the deregulated markets of developing countries, such as Montenegro. Another goal is to identify and analyze the criter...

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Autores principales:	Zdenka Dragasevic, Nikola Milovic, Vladimir Djurisic, Tamara Backovic
Formato:	article
Lenguaje:	EN
Publicado:	Elsevier 2021
Materias:	Developing countries Deregulated electricity market Regression model Renewable energy sources A dominant firm leadership model Electrical engineering. Electronics. Nuclear engineering TK1-9971
Acceso en línea:	https://doaj.org/article/4d83fe0fb0a946e2a51064d4204ef210
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spelling	oai:doaj.org-article:4d83fe0fb0a946e2a51064d4204ef2102021-11-18T04:49:21ZAnalyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries2352-484710.1016/j.egyr.2021.07.046https://doaj.org/article/4d83fe0fb0a946e2a51064d4204ef2102021-11-01T00:00:00Zhttp://www.sciencedirect.com/science/article/pii/S2352484721005114https://doaj.org/toc/2352-4847The aim of this paper is to measure the impact of certain factors on the formation of the price of electricity, which is obtained from conventional and renewable energy sources, in the deregulated markets of developing countries, such as Montenegro. Another goal is to identify and analyze the criteria that can lead to a change in the electricity market structure. This study was especially inspired by the fact that no similar research has been conducted in this domain, according to the authors’ knowledge. A regression model is applied in the paper, which can be used to display the fluctuation of electricity prices based on the analyzed factors. In addition to price as a dependent variable, the model also examined eight factors that are independent variables. Apart from the basic model, another model has been formulated which, in addition to a price as dependent variable and the examined factors, also takes into consideration the production of electricity from renewable sources. The results of the research showed that an increase in the amount of electricity produced will lead to a slight increase in price, which is to be expected considering there is still one large producer servicing the market, which, despite the deregulation of the market, still has significant monopoly power. The generation of electricity by small hydropower plants will not significantly affect price change, and these entities will behave as if they were in a market of perfect competition. Further opening up the market to new competitors would lead to a fall in the price of electricity. Based on the predicted capacity of electricity generation from small hydropower plants, the electricity deficit could be reduced; in another words it could lead to the reduction of imports. Based on the results of the study, energy policy makers will be able to adopt informed strategies and make decisions related to developments in the energy market, most notably the creation of a common EU energy market. Also, the results of the conducted research expand the theoretical body of work dealing with the determination of the price of electricity. Future studies could address the issue of using natural potential for the generation of electricity from renewable sources, such as solar energy, wind energy and other sources.Zdenka DragasevicNikola MilovicVladimir DjurisicTamara BackovicElsevierarticleDeveloping countriesDeregulated electricity marketRegression modelRenewable energy sourcesA dominant firm leadership modelElectrical engineering. Electronics. Nuclear engineeringTK1-9971ENEnergy Reports, Vol 7, Iss , Pp 937-949 (2021)
institution	DOAJ
collection	DOAJ
language	EN
topic	Developing countries Deregulated electricity market Regression model Renewable energy sources A dominant firm leadership model Electrical engineering. Electronics. Nuclear engineering TK1-9971
spellingShingle	Developing countries Deregulated electricity market Regression model Renewable energy sources A dominant firm leadership model Electrical engineering. Electronics. Nuclear engineering TK1-9971 Zdenka Dragasevic Nikola Milovic Vladimir Djurisic Tamara Backovic Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries
description	The aim of this paper is to measure the impact of certain factors on the formation of the price of electricity, which is obtained from conventional and renewable energy sources, in the deregulated markets of developing countries, such as Montenegro. Another goal is to identify and analyze the criteria that can lead to a change in the electricity market structure. This study was especially inspired by the fact that no similar research has been conducted in this domain, according to the authors’ knowledge. A regression model is applied in the paper, which can be used to display the fluctuation of electricity prices based on the analyzed factors. In addition to price as a dependent variable, the model also examined eight factors that are independent variables. Apart from the basic model, another model has been formulated which, in addition to a price as dependent variable and the examined factors, also takes into consideration the production of electricity from renewable sources. The results of the research showed that an increase in the amount of electricity produced will lead to a slight increase in price, which is to be expected considering there is still one large producer servicing the market, which, despite the deregulation of the market, still has significant monopoly power. The generation of electricity by small hydropower plants will not significantly affect price change, and these entities will behave as if they were in a market of perfect competition. Further opening up the market to new competitors would lead to a fall in the price of electricity. Based on the predicted capacity of electricity generation from small hydropower plants, the electricity deficit could be reduced; in another words it could lead to the reduction of imports. Based on the results of the study, energy policy makers will be able to adopt informed strategies and make decisions related to developments in the energy market, most notably the creation of a common EU energy market. Also, the results of the conducted research expand the theoretical body of work dealing with the determination of the price of electricity. Future studies could address the issue of using natural potential for the generation of electricity from renewable sources, such as solar energy, wind energy and other sources.
format	article
author	Zdenka Dragasevic Nikola Milovic Vladimir Djurisic Tamara Backovic
author_facet	Zdenka Dragasevic Nikola Milovic Vladimir Djurisic Tamara Backovic
author_sort	Zdenka Dragasevic
title	Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries
title_short	Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries
title_full	Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries
title_fullStr	Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries
title_full_unstemmed	Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries
title_sort	analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries
publisher	Elsevier
publishDate	2021
url	https://doaj.org/article/4d83fe0fb0a946e2a51064d4204ef210
work_keys_str_mv	AT zdenkadragasevic analyzingthefactorsinfluencingtheformationofthepriceofelectricityinthederegulatedmarketsofdevelopingcountries AT nikolamilovic analyzingthefactorsinfluencingtheformationofthepriceofelectricityinthederegulatedmarketsofdevelopingcountries AT vladimirdjurisic analyzingthefactorsinfluencingtheformationofthepriceofelectricityinthederegulatedmarketsofdevelopingcountries AT tamarabackovic analyzingthefactorsinfluencingtheformationofthepriceofelectricityinthederegulatedmarketsofdevelopingcountries
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Analyzing the factors influencing the formation of the price of electricity in the deregulated markets of developing countries

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