The Energy Transition: an Industrial Economics Perspective Articles uri icon

publication date

  • April 2021

start page

  • 1

end page

  • 46


  • 79

International Standard Serial Number (ISSN)

  • 0167-7187

Electronic International Standard Serial Number (EISSN)

  • 1873-7986


  • The Energy Transition:An Industrial Economics PerspectiveNatalia FabraEnergyEcoLab, Universidad Carlos III de Madrid and CEPRMarch 21, 2021AbstractAddressing climate change requires full decarbonization of our economies. Whetherthis objective is achieved at least cost for society hinges on good policy design. Inturn, this calls for a thorough understanding of firms' and consumers' incentives inthe presence of asymmetric information, the determinants of strategic interaction,and the impact of market design and market structure on the intensity of competi-tion. Industrial Economics thus has much to contribute towards a successful EnergyTransition, while benefiting from the exciting research opportunities it brings. Inthis paper, I survey some of the recent developments in this area. My focus is onthe power sector, and in particular, on the regulatory and market design challengestriggered by the expansion of intermittent renewables with almost zero marginalcosts. I conclude with some questions that merit further research.


  • Economics


  • emissions; energy; competition; market power; market design; auctions; investment; dynamic pricing;storage