Income risk of EU coal-fired power plants after Kyoto

Coal-fired power plants may enjoy a significant advantage relative to gas plants in terms of cheaper fuel cost. Still, this advantage may erode or even turn into disadvantage depending on CO2 emission allowance price. This price will presumably rise in both the Kyoto Protocol commitment period (2008-2012) and the first post-Kyoto years. Thus, in a carbon-constrained environment, coal plants face financial risks arising in their profit margins, which in turn hinge on their so-called "clean dark spread". These risks are further reinforced when the price of the output electricity is determined by natural gas-fired plants' marginal costs, which differ from coal plants' costs. We aim to assess the risks in coal plants' margins. We adopt parameter values estimated from empirical data. These in turn are derived from natural gas and electricity markets alongside the EU ETS market where emission allowances are traded. Monte Carlo simulation allows to compute the expected value and risk profile of coal-based electricity generation. We focus on the clean dark spread in both time periods under different future scenarios in the allowance market. Specifically, bottom 5% and 10% percentiles are derived. According to our results, certain future paths of the allowance price may impose significant risks on the clean dark spread obtained by coal plants.

Global movements, national grievances. Mobilizing for “real democracy” and social justice

In the ashes of political and socio-economic collapse, social movements sometimes rise like a phoenix. Little more than a year has passed since the Tunisian uprisings, the spark that ignited a series of “mobilizations of the indignant” that spread like wildfire around the world. Many observers have reported on these unprecedented global protests. They have portrayed citizens who declare feeling marginalized if not scapegoated, and who reject the increasing inequalities between rich and poor, the declining mobility of most, and the “disclassment” of many. They have shown, as well, massive protests against governments and politicians that are perceived as indifferent at best, duplicitous at worst, and in any event as blatantly closed to popular concerns. Many journalists have indeed asked what took so long for people to protest given this fatal combination. For the social scientist, however, the questions of who, why and how mobilizes are not so simple. There are specific problematics of mediation between structure, culture and individual or collective agency that need to be addressed.