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Water, electricity, and climate change

School of Social Sciences

About the Project

There are intricate links between water, electricity, and climate change. By 2050 worldwide under a reference case, the share of renewables in electricity generation is expected to be 50%, and the share of hydroelectric power in renewables generation, one-fourth (EIA 2020). A pumped hydro system is a mature technology for electricity generation and remains a key source of bulk electricity storage (EIA 2019), yet the addition of reservoir capacity is potentially in conflict with the protection of the natural environment, especially if the water resource is perceived to be overexploited or there is a negative public opinion on new invasive infrastructure, such as dams (Maran et al 2014). Meanwhile, climate change is affecting the temporal or spatial pattern of the loss or retreat of glacial mass (Huss and Hock 2018). Depending on the incidence, duration, or magnitude of climate change effects, the availability of water for hydroelectric power, especially in vulnerable areas, countries, or regions, could be at risk.

Markets play a key role in signalling opportunities for the capture of potential benefits arising from climate change adaptation (Anderson et al 2019). Electricity generation and transmission assets are complements and substitutes in the operation and expansion of the electricity sector, and there are many challenges associated with the design or implementation of incentives for attracting investments (Cretì and Fontini 2019). Under future warming scenarios in Europe, the significant increase in peak load and overall electricity consumption affects not only the location of peak generation, storage, or transmission capacity investments, but also the design of energy efficiency policy (Wenz et al 2017). Climate change is likewise expected to cause huge increases in the intensity and frequency of peak electricity demand in the US (Auffhammer et al 2017). Climate change could affect the supply of or demand for freshwater though an increase in temperatures, the incidence of drought, or the use of irrigation (Anderson et al 2019). Where they exist, water markets support the allocation of water to its highest valued uses, the generation information on alternative values, the identification of novel uses, or the compensation of water rights owners (Anderson et al 2019). In other words, climate change has an outsize impact on the fundamental drivers of value in electricity and water markets. Indeed a legal framework governing the valuation of watercourse assets is central to the optimal allocation of water, especially in a transboundary setting (Macatangay and Rieu-Clarke 2018). The interaction between electricity and water markets affects the optimality of operation or expansion decisions in both electricity and water sector assets (Rieu-Clarke and Macatangay 2019).

What, then, are the implications of climate change on the operation or expansion decisions in electricity, water, and related infrastructure? One approach, under a general class of optimisation models, is to use a complementarity problem nesting a wide range of specific models for regulated or deregulated energy markets under perfect or imperfect competition (Gabriel et al 2013). Indeed the concept of complementarity is a “natural way” to describe market equilibria, and a particular representation, a mixed complementarity problem (“MCP”) involving equality and inequality constraints, is widely used in energy market modelling and policy evaluation (Murphy et al 2016). In a hydrothermal system under perfect competition, price is equal either to the sum of the marginal cost of thermal generation and the shadow value of its capacity, or to the marginal value of water (Bushnell 2003). The ownership configuration of generation assets has a considerably effect on the prospects for competition (Hakam and Macatangay 2018).

For informal enquiries about the project: Dr Macatangay ()
For general enquiries about the University:

Applicants must have obtained a 2.1 UK honours degree or higher in a relevant discipline, or equivalent for degrees obtained outside the UK. Applicants should normally have a good taught Masters degree (e.g. an average of B or higher) or equivalent in a relevant discipline from a recognised university.

English language requirement:


Step 1: Email Dr Macatangay () to (1) send a copy of your CV and (2) discuss your potential application and any practicalities (e.g. suitable start date).

Step 2: Formal applications can be made via UCAS Postgraduate:

In the ‘provider questions’ section of the application form:
- Write the project title and ‘’ in the ‘if your application is in response to an advertisement’ box;
- Write the lead supervisor’s name and give brief details of your previous contact with them in the ‘previous contact with the University of Dundee’ box.

Funding Notes

There is no funding attached to this project. The successful applicant will be expected to provide the funding for tuition fees and living expenses, via external sponsorship or self-funding.

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