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Energy Markets and Pandemics

A special issue of Energies (ISSN 1996-1073). This special issue belongs to the section "C: Energy Economics and Policy".

Deadline for manuscript submissions: closed (31 December 2021) | Viewed by 4213

Special Issue Editor


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Guest Editor
Questrom School of Business, Boston University, Boston, MA 02215, USA
Interests: asset pricing; consumption-portfolio choice derivative securities; energy markets; climate finance; numerical methods

Special Issue Information

Dear Colleagues,

Pandemics have disastrous effects on economic and social systems, in addition to their devastating impact on populations. This Special Issue will seek to understand the implications of epidemics for energy markets. Studies shedding light on macro- and micro-economic adjustments in response to disease propagation mechanisms are of interest. Sectoral analyses, for instance pertaining to Green Energy, are also sought. Articles dealing with implications for the investment and financing of energy projects fall within the scope of this Special Issue. A non-inclusive list of possible topics follows:

  • Energy supply and demand
  • Energy prices
  • Energy firm valuations
  • Energy markets and interest rates
  • Energy markets and labor markets
  • Energy markets and financial markets
  • Energy markets and mitigation policies
  • Energy projects: investments
  • Energy projects: financing
  • Green energy: investments 
  • Green energy: financing

Prof. Dr. Jerome Detemple
Guest Editor

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Published Papers (2 papers)

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Research

13 pages, 761 KiB  
Article
COVID-19 Effects on Arbitrage Trading in the Energy Market
by Li Chen and Guang Zhang
Energies 2022, 15(13), 4584; https://doi.org/10.3390/en15134584 - 23 Jun 2022
Cited by 3 | Viewed by 2081
Abstract
This paper investigates the effects of coronavirus disease 2019 (COVID-19) on the performance of arbitrage trading in the energy market using daily data covering the period between 1 January 2015 and 5 December 2021. The investigation was achieved by utilizing a parametric pairs-trading [...] Read more.
This paper investigates the effects of coronavirus disease 2019 (COVID-19) on the performance of arbitrage trading in the energy market using daily data covering the period between 1 January 2015 and 5 December 2021. The investigation was achieved by utilizing a parametric pairs-trading model, where pairs of energy-related securities, including futures, stocks and ETFs traded in the United States, are formed. The empirical results suggest that the out-of-sample performances of pair trading declined sharply in the face of COVID-19. Dividing the whole data sample into two sub-samples, we found that the strategy performed well before COVID-19 but yielded poor results in the pandemic era. The analysis presented in this paper could serve as a benchmark for arbitrage-based trading models in the energy market during the pandemic. Full article
(This article belongs to the Special Issue Energy Markets and Pandemics)
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25 pages, 564 KiB  
Article
Optimal Power Investment and Pandemics: A Micro-Economic Analysis
by Jerome Detemple and Yerkin Kitapbayev
Energies 2021, 14(4), 814; https://doi.org/10.3390/en14040814 - 4 Feb 2021
Cited by 1 | Viewed by 1487
Abstract
This paper derives the optimal investment policy of an electricity producer during a pandemic. We consider three problems: (1) investing in a gas-fired plant, (2) investing in a wind plant, and (3) investing in the best of a gas plant and a wind [...] Read more.
This paper derives the optimal investment policy of an electricity producer during a pandemic. We consider three problems: (1) investing in a gas-fired plant, (2) investing in a wind plant, and (3) investing in the best of a gas plant and a wind plant. Optimal investment boundaries are characterized and valuation formulas derived. For single technology projects, a pandemic postpones wind investment, but can accelerate gas investment when the relative price of gas decreases. For choices between the two technologies, a substitution effect can reinforce the single technology effects, accelerating gas investment under certain conditions. The paper examines the impact of pandemic parameters, economic parameters and policy parameters on the investment boundaries, the values of projects and the premium for green energy. Full article
(This article belongs to the Special Issue Energy Markets and Pandemics)
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