Analysis the Impact of Hydro Renewable Energy on Electricity Prices in Iran Using a Long-Run Dynamic Model

The energy crisis in recent years has led politicians and major countries around the world to take energy issues differently from the past and replace fossil fuels with renewable energies, including hydroelectricity, to reduce and save energy, controlling supply and demand energy and reduction of pollutant emissions has been widely welcomed. Accordingly, the present study investigates the impact of hydroelectricity renewable energy and also examines the impact of thermal powerhouse production on electricity price in Iran as a separate model during the period of 1982-2020. In this regard, the short-term and long-term equilibrium relationship are investigated between electricity generation in hydroelectricity and thermal powerhouse and electricity price using Auto Regressive Distributed Lag (ARDL) model. Findings show that the impact of hydroelectricity technology in terms of reducing end-user tariffs, offers better benefits than thermal technology. Other results show that the increasing effect of interest rate, exchange rate and the price of fuel oil is realized gradually and in the long run as a direct input of powerhouse on electricity price.