scholarly journals A Capacity Market for the Transition towards Renewable-Based Electricity Generation with Enhanced Political Feasibility

Energies ◽  
2021 ◽  
Vol 14 (18) ◽  
pp. 5889
Author(s):  
Sebastian Schäfer ◽  
Lisa Altvater
Keyword(s):  
Electricity Markets ◽  
Electricity Market ◽  
Electricity Generation ◽  
Potential Problem ◽  
Substantial Cost ◽  
Optimal Capacity ◽  
Price Signals ◽  
Capacity Market ◽  
Cost Reductions ◽  
Generation Capacity

There is a debate if electricity markets on the basis of energy-only markets ensure a sufficient generation capacity. Various capacity mechanisms are discussed to tackle this potential problem. Capacity auctions with reliability options are seen as one market-based solution. Assuming a perfect energy-only market, this mechanism leads to an equilibrium with an optimal capacity mix. This optimum is missed if there are distorted price signals at the electricity market. This is a serious problem since, despite substantial cost reductions, renewable-based electricity generation still depends on subsidies, which are not internalized at electricity markets. We develop a capacity market that internalizes subsidies for RES without direct intervention in the electricity market. The result is an endogenous discrimination of capacity prices, which enhances acceptance for a capacity market. Arising incentives direct the capacity mix to an equilibrium where discriminated prices converge to one uniform capacity price. The equilibrium is the optimal answer of fossil capacity to RES-based electricity generation.

scholarly journals Prosumer Community Portfolio Optimization via Aggregator: The Case of the Iberian Electricity Market and Portuguese Retail Market

Energies ◽  
2021 ◽  
Vol 14 (13) ◽  
pp. 3747
Author(s):  
Ricardo Faia ◽  
Tiago Pinto ◽  
Zita Vale ◽  
Juan Manuel Corchado
Keyword(s):  
Portfolio Optimization ◽  
Electricity Markets ◽  
Electricity Market ◽  
Retail Market ◽  
Wholesale Market ◽  
Generation Capacity ◽  
Wholesale Electricity Market ◽  
Portfolio Optimization Model ◽  
Photovoltaic Generators

The participation of household prosumers in wholesale electricity markets is very limited, considering the minimum participation limit imposed by most market participation rules. The generation capacity of households has been increasing since the installation of distributed generation from renewable sources in their facilities brings advantages for themselves and the system. Due to the growth of self-consumption, network operators have been putting aside the purchase of electricity from households, and there has been a reduction in the price of these transactions. This paper proposes an innovative model that uses the aggregation of households to reach the minimum limits of electricity volume needed to participate in the wholesale market. In this way, the Aggregator represents the community of households in market sales and purchases. An electricity transactions portfolio optimization model is proposed to enable the Aggregator reaching the decisions on which markets to participate to maximize the market negotiation outcomes, considering the day-ahead market, intra-day market, and retail market. A case study is presented, considering the Iberian wholesale electricity market and the Portuguese retail market. A community of 50 prosumers equipped with photovoltaic generators and individual storage systems is used to carry out the experiments. A cost reduction of 6–11% is achieved when the community of households buys and sells electricity in the wholesale market through the Aggregator.

scholarly journals Earth, Wind, and Fire: Power Infrastructure in Alberta’s New Age

2017 ◽  
Author(s):  
Cameron Hughes ◽  
Caitlin Graham ◽  
Charles July ◽  
Adam Brown ◽  
Thomas Schubert ◽  
...  
Keyword(s):  
Electricity Markets ◽  
Electricity Market ◽  
New Age ◽  
The United States ◽  
Renewable Generation ◽  
Policy Changes ◽  
The United Kingdom ◽  
Capacity Market ◽  
The Government ◽  
Regulatory Intervention

In the wake of dramatic policy changes commencing in late 2015, including the Government of Alberta’s announcement of the Climate Leadership Plan, the Renewable Energy Program, and the decision to introduce a parallel capacity market into Alberta’s previous energy-only market, the future of Alberta’s electricity market is uncertain. However, regulatory intervention in an attempt to improve the function of electricity markets and encourage renewable generation is not a new concept.Other jurisdictions, including the United Kingdom, Germany, and jurisdictions in the United States, have used regulatory intervention to address issues in energy markets and to drive renewable generation. Regulatory intervention in these jurisdictions has not always achieved the intended consequences. In some cases, regulatory intervention has exacerbated issues it intended to solve, or created new problems. In other cases, regulatory intervention has relatively improved the function of electricity markets and incited renewable generation. This paper considers the evolution of energy policy and competing policy drivers, including system reliability, use of sustainable fuels to generate electricity, and price surges. The paper will discuss the success and failure of regulatory intervention in select jurisdictions, and how these lessons might apply in the new age of Alberta’s electricity market.

scholarly journals Forecasting Short-term Wholesale Prices on the Irish Single Electricity Market

2018 ◽  
Vol 8 (6) ◽  
pp. 4060
Author(s):  
Francesco Arci ◽  
Jane Reilly ◽  
Pengfei Li ◽  
Kevin Curran ◽  
Ammar Belatreche
Keyword(s):  
Electricity Markets ◽  
Electricity Market ◽  
Electricity Generation ◽  
Informed Trading ◽  
Electricity Prices ◽  
Customer Demand ◽  
Short Term ◽  
Market Participants ◽  
Energy Demands ◽  
Trading Decisions

Electricity markets are different from other markets as electricity generation cannot be easily stored in substantial amounts and to avoid blackouts, the generation of electricity must be balanced with customer demand for it on a second-by-second basis. Customers tend to rely on electricity for day-to-day living and cannot replace it easily so when electricity prices increase, customer demand generally does not reduce significantly in the short-term. As electricity generation and customer demand must be matched perfectly second-by-second, and because generation cannot be stored to a considerable extent, cost bids from generators must be balanced with demand estimates in advance of real-time. This paper outlines a a forecasting algorithm built on artificial neural networks to predict short-term wholesale prices on the Irish Single Electricity Market so that market participants can make more informed trading decisions. Research studies have demonstrated that an adaptive or self-adaptive approach to forecasting would appear more suited to the task of predicting energy demands in territory such as Ireland. We have identified the features that such a model demands and outline it here.

An electricity market model with generation capacity expansion under uncertainty

2012 ◽  
Author(s):  
Andreas Schroeder
Keyword(s):  
Electricity Market ◽  
Electricity Generation ◽  
Power Plants ◽  
Thermal Power ◽  
Capacity Expansion ◽  
Carbon Price ◽  
Market Model ◽  
Investment Incentives ◽  
Investment Portfolio ◽  
Generation Capacity

This article presents an electricity dispatch model with endogenous electricity generation capacity expansion for Germany over the horizon 2035. The target is to quantify how fuel and carbon price risk impacts investment incentives of thermal power plants. Results point to findings which are in line with general theory: Accounting for stochasticity increases investment levels overall and the investment portfolio tends to be more diverse.

scholarly journals MARKET DRIVEN POWER PLANT INVESTMENT PERSPECTIVES IN EUROPE: CLIMATE POLICY AND TECHNOLOGY SCENARIOS UNTIL 2050 IN THE MODEL EMELIE-ESY

2013 ◽  
Vol 04 (supp01) ◽  
pp. 1340007 ◽  
Author(s):  
A. SCHRÖDER ◽  
T. TRABER ◽  
C. KEMFERT
Keyword(s):  
Climate Policy ◽  
Electricity Markets ◽  
Electricity Market ◽  
Carbon Capture ◽  
Nuclear Power ◽  
Carbon Capture And Storage ◽  
Market Prices ◽  
Generation Capacity ◽  
Private Investors ◽  
A Minor

In the framework of the Energy Modeling Forum 28, we investigate how climate policy regimes affect market developments under different technology availabilities on the European power markets. We use the partial equilibrium model EMELIE-ESY with focus on electricity markets in order to determine how private investors optimize their generation capacity investment and operation over the horizon 2010 to 2050. For the year 2050, the model projects a minor increase of power consumption of 10% under current climate policy, and a balanced pathway for consumption under ambitious climate policy compared to 2010 levels. These results contrast with findings of POLES and PRIMES models that predict strong consumption increases of 44% to 48% by 2050 and claim competitiveness of nuclear power and CCS options. Under ambitious climate policy, our findings correspond with major increases of wholesale electricity market prices and comparatively less pronounced emission price increases, which trigger no investments into Carbon Capture and Storage (CCS) and a strongly diminishing share of nuclear energy.

scholarly journals Factors affecting the transition of the Polish power system

2019 ◽  
Vol 108 ◽  
pp. 01001
Author(s):  
Wojciech Suwala ◽  
Artur Wyrwa
Keyword(s):  
Power System ◽  
Electricity Markets ◽  
Electricity Generation ◽  
Renewable Energy Sources ◽  
Energy Systems ◽  
Operational Flexibility ◽  
Power Sector ◽  
Stable Mode ◽  
Factors Affecting ◽  
Capacity Market

Energy systems face radical –almost revolutionary changes which, however, will be stretched over the long period. The critical factors influencing the future development of the Polish power sector are discussed in this paper. Development of intermittent energy supplies from renewable energy sources imposes a challenge on the entire power system and requires specific adaptations and responses from traditional generation units. Up to the present time they have been used to work in the stable mode while now they need more operational flexibility. The share of RES constantly increases. On one hand, this has a very positive environmental impact, but on the other it disturbs economics of classical generation units. Also liberalized electricity markets are impacted and the risks in power investments have increased. The capacity market could constitute a remedy, which will incentivise the investments necessary to fill the gap created by closing exhausted and inefficient plants. On the consumer side electromobility could change the demand, not only in quantity but also in terms of load profile. Climate policy tends to detriment coal based generation. For countries abundant in coal resources which make use of this cheap fuel, such as Poland, the question arises about its future role. Even in the most coal-supportive scenarios revised in this paper its relative share in electricity generation does not exceed 50% in 2050 while in others it rather goes much below 30%. .

scholarly journals Prosumers’ Behavior under a Regulation That Encourages Strict Self-Sufficiency. The Case of Spanish Photovoltaic Micro-Generation

Energies ◽  
2021 ◽  
Vol 14 (4) ◽  
pp. 1114
Author(s):  
Pere Mir-Artigues ◽  
Pablo del Río
Keyword(s):  
Electricity Markets ◽  
Electricity Market ◽  
Specific Form ◽  
Economic Behavior ◽  
Distribution Grid ◽  
Self Sufficiency ◽  
Regulatory Limits ◽  
Regulatory Measures ◽  
Self Production ◽  
Municipal Level

The reduction of equipment costs encourages the diffusion of photovoltaic micro-generation, however, proper regulatory measures should be implemented to facilitate self-production dissemination and to promote the emergence of new electricity markets which integrate prosumers. The specific form of these markets will depend on the level of prosumers’ self-sufficiency and the type of grid to which they will be connected. Unfortunately, Spain has been an example of resistance to micro-generation deployment. However, some things have started to change recently, albeit only to a certain extent. This article explains the key elements of the latest regulation of photovoltaic micro-generation in Spain and, through a stylized model, describes the economic behavior of prosumers in such a regulatory framework. It is concluded that this regulation only encourages prosumer plants which are strictly focused on self-sufficiency because it discourages exports and limits capacities and this regulation discourages the smart renewal of the distribution grid because it prevents prosumers from participating in the electricity market. It is recommended that the aforementioned regulatory limits be removed and pilot experiences for the market participation of prosumers be promoted by creating the appropriate technical and regulatory conditions, for example, at the municipal level.

scholarly journals Electricity Markets during the Liberalization: The Case of a European Union Country

Energies ◽  
2021 ◽  
Vol 14 (14) ◽  
pp. 4317
Author(s):  
Štefan Bojnec ◽  
Alan Križaj
Keyword(s):  
Electricity Markets ◽  
Electricity Market ◽  
Renewable Energy Sources ◽  
Primary Energy ◽  
Lessons Learned ◽  
Policy Implications ◽  
Daily Maximum ◽  
Energy Prices ◽  
Electricity Prices ◽  
Electricity Power

This paper analyzes electricity markets in Slovenia during the specific period of market deregulation and price liberalization. The drivers of electricity prices and electricity consumption are investigated. The Slovenian electricity markets are analyzed in relation with the European Energy Exchange (EEX) market. Associations between electricity prices on the one hand, and primary energy prices, variation in air temperature, daily maximum electricity power, and cross-border grid prices on the other hand, are analyzed separately for industrial and household consumers. Monthly data are used in a regression analysis during the period of Slovenia’s electricity market deregulation and price liberalization. Empirical results show that electricity prices achieved in the EEX market were significantly associated with primary energy prices. In Slovenia, the prices for daily maximum electricity power were significantly associated with electricity prices achieved on the EEX market. The increases in electricity prices for households, however, cannot be explained with developments in electricity prices on the EEX market. As the period analyzed is the stage of market deregulation and price liberalization, this can have important policy implications for the countries that still have regulated and monopolized electricity markets. Opening the electricity markets is expected to increase competition and reduce pressures for electricity price increases. However, the experiences and lessons learned among the countries following market deregulation and price liberalization are mixed. For industry, electricity prices affect cost competitiveness, while for households, electricity prices, through expenses, affect their welfare. A competitive and efficient electricity market should balance between suppliers’ and consumers’ market interests. With greening the energy markets and the development of the CO2 emission trading market, it is also important to encourage use of renewable energy sources.

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