Seminario divulgativo Andy Philpott 17/06/2019: Efficiency of the New Zealand wholesale electricity market 2008-2017
Using a suite of perfectly competitive counterfactual models we study the efficiency of the New Zealand wholesale electricity market over the ten-year period 2008-2017. Our models combine stochastic dual dynamic programming with a high fidelity simulation model of the New Zealand hydrothermal electricity system. Results of the models are given for the calendar years 2008-2017, and compared with wholesale market outcomes in those years. Counterfactual outcomes depend on assumptions on fuel prices and attitudes towards shortage risk. Depending on assumptions, we identify differences in productive efficiency and Ricardian rents.