Fontini F., Paloscia L. (2007)

The impact of the new investments in combined cycle gas turbine power plants on the Italian electricity price. Energy policy35(9), 4671-4676.

 

Abstract:

The paper measures the variation of the electricity price in Italy within the next 10 years due to the recent investment flow in combined cycle gas turbine (CCGT) power plants. It starts by investigating the possibility of decoupling gas and oil prices on the basis of hypotheses about the amount of existing resources and plausible technical substitutability assumptions of the latter with the former. In particular, it is supposed that, in the Italian market, natural gas will play a crucial role which oil has had in power generation. The price of electricity stemming from natural gas is then calculated taking into account the role of the power mix restructuring that derives from the CCGT power plants investments. Under reasonable assumptions, it is shown that a net reduction of at least 17% on the electric price is likely to be expected.