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Fossil Fuels and Renewable Energy: Mix or Match?

Natalia Fabra & Gerard Guasch Llobet

RAND Journal of Economics2026https://doi.org/10.1111/1756-2171.70044article
AJG 4ABDC A*
Weight
0.50

Abstract

This article investigates the influence of technological ownership on pricing strategies and productive efficiency. Our motivation comes from the evolving landscape of electricity markets where firms are transitioning from diversified to specialized portfolios, focusing on renewable energy or fossil fuels. Our theoretical model demonstrates that diversified firms compete more vigorously than their specialized counterparts. Conversely, specialized firms exhibit higher productive efficiency but only when thermal sources dominate. The magnitude of our theoretical predictions is assessed through simulations using data from the Spanish electricity market. Methodologically, our analysis offers novel insights for studying multi‐unit auctions with cost heterogeneity and privately known capacities.

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https://doi.org/https://doi.org/10.1111/1756-2171.70044

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@article{natalia2026,
  title        = {{Fossil Fuels and Renewable Energy: Mix or Match?}},
  author       = {Natalia Fabra & Gerard Guasch Llobet},
  journal      = {RAND Journal of Economics},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1111/1756-2171.70044},
}

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Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.