An estimate of the value of lost load for the new Eu countries

Abstract

© 2014, International Academy of Business and Economics. All rights reserved. This paper estimates the value of lost load (VoLL) for eleven new EU member countries in period 2004-2012 using a production function approach. The estimate is focused on the industrial sector. The main finding indicates that the VoLLs, also known as the value of security of electricity supply, vary significantly over time and across countries. The VoLLs exhibit an increasing trend in the countries under consideration. However, the period of the economic crisis made them more volatile. Furthermore, countries with higher levels of electricity use, more productive industrial sector, and/or higher level of gross domestic product per capita tend to have relatively lower estimates of the VoLL, and vice versa.