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If electricity is the new oil, what effects will an electricity price shock have on the Swedish economy?: A dynamic stochastic general equilibrium model
Umeå universitet, Samhällsvetenskapliga fakulteten, Handelshögskolan vid Umeå universitet, Nationalekonomi.
2024 (engelsk)Independent thesis Advanced level (degree of Master (Two Years)), 10 poäng / 15 hpOppgave
Abstract [en]

This paper investigates the macroeconomic effects of a domestic electricity price shock in Sweden, a country undergoing a rapid green energy transition. Using a dynamic stochastic general equilibrium (DSGE) model, the paper analyzes the impact of electricity price volatility under three scenarios: a Baseline scenario, a Low Import - High Demand scenario, and a High Import - High Demand scenario. The results indicate that while output in the non-energy sector remains pretty much unaffected, the domestic electricity sector experiences significant expansion in production and capital investment. Conversely, the non-energy sector sees reductions in electricity input and capital, and both domestic and foreign electricity consumption as well as non-energy consumption experiences sharp declines immediately after the shock. By offering a comprehensive analysis of the economic consequences of an electricity price shock in Sweden, this paper contributes valuable insights to the field of energy economics.

sted, utgiver, år, opplag, sider
2024.
HSV kategori
Identifikatorer
URN: urn:nbn:se:umu:diva-235954OAI: oai:DiVA.org:umu-235954DiVA, id: diva2:1941189
Tilgjengelig fra: 2025-03-10 Laget: 2025-02-27 Sist oppdatert: 2025-03-10bibliografisk kontrollert

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