Policy Evaluation of Cross-Regional Interconnection Lines in the Electricity Market
This program studies the interconnection lines in the Japanese power system. Interconnection lines are the high-voltage transmission lines that connect areas under the jurisdiction of transmission and distribution companies. Japan’s electricity network has the technical feature that the amount of supply and demand must be constantly matched. Otherwise, the frequency will change drastically, and there will be a risk of blackouts. In addition, future electricity networks will face new challenges of more severe natural disasters due to climate change and the massive introduction of renewable energy essential for the realization of a decarbonized society.
The use of interconnection lines has the effect of building a stable power system that is resistant to disasters and accidents and of realizing a low-cost power supply. However, the interregional transfer of energy through interconnections has been historically limited because incumbent vertically integrated electric power companies, which have a regional monopoly, were self-sufficient in meeting demand in their respective regions before the Great East Japan Earthquake. In this research program, I will evaluate how efficiently Japan's interconnection lines are being utilized by estimating the effects of institutional reforms related to interconnection line congestion management and capacity upgrade policies implemented after the earthquake.