Economy and Society - 5EUS5ECS

Goal(s)

This module offers an in-depth economic analysis of major contemporary energy issues: the functioning of gas, oil, and electricity markets; regulation and pricing; support for renewable energy; technological innovation; and energy transition policies. It also explores the interconnections between energy, sustainable development, and climate justice, using both theoretical and applied tools from energy economics. This multidisciplinary module trains students to understand the innovation process—from R&D to full commercialization—by identifying key technologies and assessing their economic impacts. Special emphasis is placed on critically analyzing energy policies in developing countries, the regulation of electricity networks, and the design of economic instruments (price-based, quantity-based, and emissions trading). Students develop a transdisciplinary approach, preparing them to become informed and proactive players in the energy transition.
Learning Objectives:

• Understand the economic fundamentals of energy markets (gas, oil, electricity).
• Analyze regulation and pricing mechanisms in energy systems.
• Assess public policies supporting the energy transition and renewables.
• Study innovation dynamics in the energy sector.
• Grasp sustainability and energy justice challenges on a global scale.

Content(s)

This course unit is divided into several parts:
1. Economics of natural gas and the international oil market (Sylvain Rossiaud) This part covers the geopolitics of gas and oil, modeling of international energy markets, the strategies of major exporters such as OPEC and Russia, as well as transitions away from fossil fuels and divestment processes.
2. Economics of Energy Innovation (Oana Ionescu)
The course explores the innovation process from R&D to full commercialization, the adoption of clean technologies such as battery electric vehicles and hydrogen, innovation support policies including auction models, and the effects of learning, networks, and imitation. The objectives include understanding the stages of technology development, analyzing the role of new technologies, and evaluating their economic consequences for markets and stakeholders.
3.Regulation and pricing in electricity markets (Haikel Khalfallah)
The class examines the regulation of natural monopolies such as electricity networks, incentive pricing mechanisms like peak pricing and marginal cost pricing, the integration of renewable energy into liberalized markets, and the design of market mechanisms including capacity markets and auctions.
4.Economic support mechanisms for renewable energy (Stéphane Robin and Nandeeta Neerunjun)
This section focuses on subsidies, feed-in tariffs, and competitive bidding, the competition between different renewable technologies (such as solar, wind, and biomass), the design of efficient and incentive-based mechanisms, and the reform of fossil fuel subsidies and carbon pricing policies.
5.Energy policy and sustainable development (Jean-Philippe Nicolai and Mathilde Aubouin)
This part includes the evaluation of public energy transition policies, the link between energy access and the Sustainable Development Goals (SDGs), issues of energy inequality and environmental justice, and the interactions between climate policies and development strategies.

Energy economics (Semester 7)