IGNOU MRW 7 2026 - Explain the concept of externalities in the energy sector wi

Question

Explain the concept of externalities in the energy sector with suitable examples.

06 Mar 2026

Answer :

Word Count : 258

In the context of energy economics and planning, externalities refer to the unintended side effects of energy production or consumption that affect third parties who are not directly involved in the transaction. These effects can be either negative or positive and are typically not reflected in the market price of energy. Negative externalities are common in the energy sector,

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