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TOP > ディスカッションペーパー > No.52 The Reason for Price Spikes in Wholesale Electricity Market: An Empirical Study on Japan's Electricity Spot Market

No.52 The Reason for Price Spikes in Wholesale Electricity Market: An Empirical Study on Japan's Electricity Spot Market

October 2023
Teng Ma*, Yimeng Du, and Jiayang Wang
*Graduate School of Economics, Kyoto University

Abstract
We examine the main factors affecting the spot prices on the Japan Electric Power Exchange during price spikes using a threshold model for time-series analysis. Our findings indicate that price spikes occur only in response to supply shortages in spot markets. Moreover, renewable energy plays an important role in Japan's energy structure. Both solar and wind power can help reduce spot prices when capacity shortages occur. Further, solar power can reduce spot prices when fossil fuel energy prices remain high.

Keywords:Electricity Market; Spot Price; Price Spikes; Renewable Power; Japan Electric Power Exchange