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The European wood pellets for heating market - Price developments, trade and market efficiency
- Source :
- Energy. 212:118636
- Publication Year :
- 2020
- Publisher :
- Elsevier BV, 2020.
-
Abstract
- Competitive international markets imply adjustments towards competitive spatial equilibrium in which excess from one market is transferred to another and prices are equilibrated except for remaining differences that can be assigned to transfer costs. The European market for wood pellets used in small-scale heating systems has been expanding significantly over the past decade. Small scale pellet heating is arguably a mature technology, but whether the market is mature is another question. In this paper we analyse recent data on trade flows and price developments between Italy, Austria, Germany and France to understand the developments of wood pellet market efficiency and to draw conclusions about market function. The objective of this study is to establish a framework to test the European residential wood pellet market for competitive spatial equilibrium using modern trade theory. We find mainly inefficiently integrated markets with remaining positive marginal profits and detectable arbitrageurs’ activity. Based on a thorough discussion of these findings and the underlying data we outline possible methodology advancements and list policy recommendations to secure access and affordability of this renewable heating commodity in the long run.
- Subjects :
- 020209 energy
media_common.quotation_subject
Commodity
Pellets
Mature technology
02 engineering and technology
Industrial and Manufacturing Engineering
020401 chemical engineering
0202 electrical engineering, electronic engineering, information engineering
Economics
Market price
0204 chemical engineering
Electrical and Electronic Engineering
Function (engineering)
Civil and Structural Engineering
media_common
business.industry
Mechanical Engineering
Building and Construction
International economics
Pollution
Renewable energy
General Energy
Scale (social sciences)
Arbitrage
business
Subjects
Details
- ISSN :
- 03605442
- Volume :
- 212
- Database :
- OpenAIRE
- Journal :
- Energy
- Accession number :
- edsair.doi...........132b53c79ab1689bda0574e6307e01c7