2024/01/18 by Bremberger, Francisca, Bremberger, Christoph, Kunz, Friedrich
paper · doi:10.57938/e5f4af04-4666-45b1-ab34-ef112771b918
The European natural gas market is characterised by higher demand than available supply from <br/>own resources. Therefore Europe is a gas net-importing region. The costs of potential problems or <br/>disruptions establish the need for an environment which stimulates sufficient investments in transmission <br/>line capacities. We examine the effects of the introduction of the recently developed Hogan, <br/>Rosellón and Vogelsang (HRV) incentive mechanism into the European natural gas market. In the <br/>simulations with GAMS we can confirm all results expected from theory. The validity of these simulation <br/>results is confirmed in a structural analysis, which comprised the variation of different exogenous <br/>input parameters. Therefore we conclude that the HRV incentive mechanism as a regulatory regime <br/>for the European natural gas market would be an advisable alternative, which should be considered <br/>in future discussions. (author's abstract)