The Impact Of Intermittent Power Generation On The Wholesale Electricity Prices Of The Mibel Iberian Market

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The Impact Of Intermittent Power Generation On The Wholesale Electricity Prices Of The Mibel Iberian Market

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Author : Paulo Pereira da Silva
language : en
Publisher:
Release Date : 2018

The Impact Of Intermittent Power Generation On The Wholesale Electricity Prices Of The Mibel Iberian Market written by Paulo Pereira da Silva and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2018 with categories.

By means of regression analysis, we address the price impact of intermittent renewable energy sources (wind, solar and waves) for the Mibel Iberian Market (Portugal and Spain) during the period spanning from 2010 to 2015. Our results suggest that: i) intermittent renewable energy has a material negative effect on electricity price; ii) the merit-order effect varies depending on the technology employed: wind power appears to produce a greater impact on price vis-à-vis solar photovoltaic energy; iii) there is no evidence corroborating the idea that the impact of intermittent renewable electricity penetration is declining over time; and iv) the market coupling with France, in effect since May 2014, led to a decrease in the sensitivity of price to intermittent renewable energy production. Our results are useful for risk management purposes and to support policy-makers and utilities in defining the optimal generation mix.

Integration Of European Electricity Markets

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Author : Marta Ferreira Dias
language : en
Publisher:
Release Date : 2011

Integration Of European Electricity Markets written by Marta Ferreira Dias and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2011 with categories.

This thesis contributes to the study of the role of some identified obstacles to delay the process of liberalisation and integration of European electricity markets and to impede the achievement of its full benefits, namely increase efficiency and, ultimately, to pass on this efficiency gains to final consumers by lowering prices of electricity. Chapter 1 is a description and analysis of the progress made on European liberalisation and integration of electricity markets, identifying some of the main obstacles found on the path to achieve the Single European Market for electricity and solutions propsed to avoid them, either from the perspective of the EC and from the perspective of economic literature. The concerns considered for this review are related with the main focus of the thesis, market power and concentration. The solutions found on the literature to avoid these obstacles are related with the search for the best market design to be adopted in the Single Electricity Market. Since the Nordic countries constitute an integrated market considered as a success, this example is briefly explained in order to understand which are the main features of this success. The second chapter presents a simulation for the integration of the Iberian wholesale electricity market (MIBEL) in order to study how the exercise of market power will evolve with regional full integration. Following Borenstein and Bushnell (1999), we compare simulated market outcomes on four days of 2004, with no integration and with full integration. The presence of market power is measured using the Lerner Index. The simulation results allow us to conclude that, as expected, market power is lower after full integration. However, even after full integration, market power is still a feature of the market. Therefore, the full benefits of liberalisation and integration are not seized by the consumers, since wholesale prices persist to be higher than the marginal costs. The market participants with more benefits are the Portuguese, both consumers and the incumbent firm. The third chapter's purpose is to assess econometrically the impact on final consumer of mergers between electricity generators and natural gas suppliers. We find evidence that a merger of this type will increase final price of electricity in the market where it occurs. Moreover, as a consequence of the EOn-Rurhas German household consumers pay more 1.8% for the electricity and, in Finland, the Nest-Ivo merger caused an increase of around 2% on prices for household consumers. The answer to the question "should household consumers be concerned if a cross sectorial merger happens" seems to be yes, due to the detrimental effects on final prices.

The Impact Of The Generation Mix On Electricity Market Prices

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Author : Maria Lorente Gay
language : en
Publisher:
Release Date : 2020

The Impact Of The Generation Mix On Electricity Market Prices written by Maria Lorente Gay and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2020 with categories.

The goal of this thesis is to investigate the impact of non-programmable renewable energy generation mix on Italian and Spanish electricity markets by studying electricity price in the spot electricity market. Specifically, to investigate whether different energy sources have a different impact on the price, whether and or how much this is varying from different market zones and whether the impact is on general, daily-basis or maybe rather on an hourly basis. To detect the impact on electricity prices, it is followed a consolidated methodology adopted by Clò et al. [1] and developed an empirical analysis for Italy's commercial markets and for the whole Spanish market by using a multivariate regression. It is considered daily averaged data for the renewable generation mix (specifically solar and wind) and spot electricity price from the respective day-ahead markets for the whole year 2018. As a secondary studio the impact on electricity prices in Italy is analysed by using hourly data. The results obtained support the hypothesis that rising zonal loads tend in general to raise zonal market prices based on the data from 2018. The intensity of this effect is pronounced with varying intensity. In Italy the lowest effect is in the North, with an impact of 1.19 €/MWh increase for each 1000 MWh of demand. The highest effect is found in the islands, reaching a value of 25.11 €/MWh in Sicily. In Spain, there is a low impact of load, with a value of only 0.045 €/MWh. It is interesting to stress how the impacts of photovoltaics and wind vary across Italian zone. While both prove to have in general a decreasing impact, on the electricity spot price, wind is the main driver of the electricity price reduction in the southern zonal areas whereas solar has a more significant decreasing impact on the northern zone prices. Eventually, Central North is the zone with the highest impact of both renewable sources. In Spain, no evidence is found for photovoltaics for electricity price reduction. But, on the other hand, an increase of 1 GWh of wind decreases the Spanish electricity price by 1.42 €/MWh. The results obtained also show for both Italy and Spain the assumption of high correlation between the price of gas and electricity: an increase of 1 €/MWh of gas price causes statistically an electricity price increase between 0.90 €/MWh and 1.73 €/MWh in Italy (depending on the zone) as well as an increase of 1.76 €/MWh in Spain. Compared to the daily data case, results of the secondary analysis show that solar comes out significant in all zones of Italy. Energy from solar panels is obtained only a few hours a day, therefore it turns out that the impact seems to be stronger on an hourly basis. However, wind has rather a daily impact, being wind generation more constant from day to day also not having such a plausible difference between hours as solar.

Impacts Of Intermittent Renewable Generation On Electricity System Costs

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Author : Joan Batalla Bejerano
language : en
Publisher:
Release Date : 2015

Impacts Of Intermittent Renewable Generation On Electricity System Costs written by Joan Batalla Bejerano and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2015 with categories.

The Iberian Exception

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Author : David Robinson
language : en
Publisher:
Release Date : 2023

The Iberian Exception written by David Robinson and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2023 with categories.

This paper by David Robinson, Angel Arcos, Michael Tennican and Fernando Núnez offers an independent assessment of certain key economic effects of the Iberian Exception (IE), the common name for legal measures affecting the Iberian power market that were introduced in June 2022 by the Spanish and Portuguese governments. The governments' stated aim was to reduce the major component of electricity prices for many Iberian consumers, a component which was indexed to Iberian wholesale power market spot prices that were rising alarmingly due to extremely tight international markets for natural gas. According to the Iberian governments, this objective was to be attained by terms of the IE that subsidize a reduction in wholesale power market prices, with the subsidy financed in part by a new element added to the bills of consumers benefiting from that wholesale price reduction. Another Spanish governmental aim was to reduce the Government's published measure of inflation, which was linked to a regulated retail price indexed to Iberian wholesale spot power market prices. The Spanish Government maintains that, during its first 100 days, the IE provided substantial benefits for consumers affected by the IE, which included over 10 million small consumers as well as many large ones. However, the authors of this study question that view. We argue that the effect of the IE on retail prices depends critically on the assumptions about what would have occurred in the absence of the IE, that is, in a counterfactual scenario. The Government's counterfactual methodology ignores demand elasticity in Iberia and in France, and this inflates their estimate of immediate consumer benefits. Using hourly data on the wholesale electricity market for the first 100 days of the IE, this paper's analysis of alternative counterfactuals that reflect the effects of demand elasticity shows substantially lower benefits of the IE for consumers than the Spanish Government methodology suggests. The analysis here suggests that affected consumers could have paid somewhat less for the energy component of their electricity bills in the first 100 days of the IE, had it not been introduced. We also identify several other potential short- and long-term effects of the IE that deserve further study. These include increased margins for fossil-fired generators, reduced margins for some decarbonized inframarginal plant, heightened investor perceptions of regulatory risk, weakened incentives for efficient consumption, and higher carbon emissions and gas prices.

Market Operations In Electric Power Systems

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Author : Mohammad Shahidehpour
language : en
Publisher: John Wiley & Sons
Release Date : 2003-05-28

Market Operations In Electric Power Systems written by Mohammad Shahidehpour and has been published by John Wiley & Sons this book supported file pdf, txt, epub, kindle and other format this book has been release on 2003-05-28 with Technology & Engineering categories.

An essential overview of post-deregulation market operations inelectrical power systems Until recently the U.S. electricity industry was dominated byvertically integrated utilities. It is now evolving into adistributive and competitive market driven by market forces andincreased competition. With electricity amounting to a $200 billionper year market in the United States, the implications of thisrestructuring will naturally affect the rest of the world. Why is restructuring necessary? What are the components ofrestructuring? How is the new structure different from the oldmonopoly? How are the participants strategizing their options tomaximize their revenues? What are the market risks and how are theyevaluated? How are interchange transactions analyzed and approved?Starting with a background sketch of the industry, this hands-onreference provides insights into the new trends in power systemsoperation and control, and highlights advanced issues in thefield. Written for both technical and nontechnical professionals involvedin power engineering, finance, and marketing, this must-haveresource discusses: * Market structure and operation of electric power systems * Load and price forecasting and arbitrage * Price-based unit commitment and security constrained unitcommitment * Market power analysis and game theory applications * Ancillary services auction market design * Transmission pricing and congestion Using real-world case studies, this timely survey offers engineers,consultants, researchers, financial managers, university professorsand students, and other professionals in the industry acomprehensive review of electricity restructuring and how itsradical effects will shape the market.

Stochastic Optimal Bid To Electricity Markets With Environmental Risk Constraints

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Author : Julián Cifuentes Rubiano
language : en
Publisher:
Release Date : 2012

Stochastic Optimal Bid To Electricity Markets With Environmental Risk Constraints written by Julián Cifuentes Rubiano and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2012 with categories.

There are many factors that influence the day-ahead market bidding strategies of a generation company (GenCo) in the current energy market framework. Environmental policy issues have become more and more important for fossil-fuelled power plants and they have to be considered in their management, giving rise to emission limitations. This work allows to investigate the influence of both the allowances and emission reduction plan, and the incorporation of the derivatives medium-term commitments in the optimal generation bidding strategy to the day-ahead electricity market. Two different technologies have been considered: the coal thermal units, high-emission technology, and the combined cycle gas turbine units, low-emission technology. The Iberian Electricity Market and the Spanish National Emissions and Allocation Plans are the framework to deal with the environmental issues in the day-ahead market bidding strategies. To address emission limitations, some of the standard risk management methodologies developed for financial markets, such as Value-at-Risk (VaR) and Conditional Value at Risk (CVaR), have been extended. This study offers to electricity generation utilities a mathematical model to determinate the individual optimal generation bid to the wholesale electricity market, for each one of their generation units that maximizes the long-run profits of the utility abiding by the Iberian Electricity Market rules, the environmental restrictions set by the EU Emission Trading Scheme, as well as the restrictions set by the Spanish National Emissions Reduction Plan. The economic implications for a GenCo of including the environmental restrictions of these National Plans are analyzed and the most remarkable results will be presented.. The problem to be solved in this project will provide generationutilities with a mathematical tool to find the individual optimal generation bid for each one of theirgeneration units that maximizes the long-run profits of the utility abiding by the Iberian ElectricityMarket rules, the environmental restrictions of the EU Emission Trading Scheme and also by theSpanish National Emissions Reduction Plan.

Risk Implications Of The Deployment Of Renewables For Investments In Electricity Generation

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Author : Fernando José de Sisternes Jiménez Sisternes
language : en
Publisher:
Release Date : 2014

Risk Implications Of The Deployment Of Renewables For Investments In Electricity Generation written by Fernando José de Sisternes Jiménez Sisternes and has been published by this book supported file pdf, txt, epub, kindle and other format this book has been release on 2014 with categories.

This thesis explores the potential risk implications that a large penetration of intermittent renewable electricity generation -such as wind and solar power- may have on the future electricity generation technology mix, focusing on the anticipated new operating conditions of different thermal generating technologies and their remuneration in a competitive market environment. In addition, this thesis illustrates with an example how risk should be valued at the power plant level in order to internalize the potential risks to which the generators are exposed. This thesis first compares the impacts of three different bidding rules on wholesale prices and on the remuneration of units in power systems with a significant share of renewable generation. The effects of bidding rules are distinguished from the effects of regulatory uncertainty that can unexpectedly increase renewable generation by considering two distinct situations: 1) an 'adapted' capacity mix, which is optimized for any given amount of renewable penetration, and 2) a 'non-adapted' capacity mix, which is optimized for zero renewable penetration, but that operates with a certain non-zero renewable capacity, added on top of an already adequate system. The analysis performed stresses the importance of sound mechanisms that allow the full-cost recovery of plants in a system where the intermittency of renewables accentuates nonconvex costs, without over-increasing the cost paid by consumers for electricity. Additionally, the analysis quantifies the potential losses incurred by different thermal technologies if renewable deployment occurs without allowing for adaptation. Methodologically, this thesis uses a novel long-term generation investment model, the Investment Model for Renewable Electricity Systems (IMRES), to determine the minimum cost thermal capacity mix necessary to complement renewable generation to meet electricity demand, and to extract hourly wholesale prices. IMRES is a capacity expansion model with unit commitment constraints whose main characteristics are: 1) reflecting the impact of hourly resolution operation constraints on investment decisions and on total generation cost; 2) accounting for the chronological variability of demand and renewable output, and the correlation between the two; and 3) deciding on power plant investments at the individual plant level. These characteristics allow for a detailed analysis of the profits obtained by individual plants in systems with large renewable penetration levels. In addition, this thesis tests the performance of a heuristic method that selects four weeks from a full year series to optimally represent the net load duration curve (i.e., the difference between demand and renewable output, decreasingly ordered). For each application of this heuristic method, three metrics are proposed to reflect that the approximation also represents the chronological variability of the net load. Lastly, this thesis explores the role of risk in the valuation of electricity generating technologies and shows how to incorporate standard risk pricing principles into the popular Monte Carlo simulation analysis. The exposition is structured using the standard framework for a typical Monte Carlo cash flow simulation so that the implementation can be readily generalized. This framework stresses the necessity of an asset pricing approach to assess the relationship between the risk in the assets cash flows and the macroeconomic risk with which the financial investors are concerned. The framework provided is flexible and can accommodate many different structures for the interaction between the macroeconomic risk and the risks in the asset's cash flows (such as those from shocks in renewable deployment).

Harnessing Variable Renewables

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Author : Organisation for Economic Co-operation and Development
language : en
Publisher: Organization for Economic Co-Operation & Development
Release Date : 2011

Harnessing Variable Renewables written by Organisation for Economic Co-operation and Development and has been published by Organization for Economic Co-Operation & Development this book supported file pdf, txt, epub, kindle and other format this book has been release on 2011 with Electric power production categories.

Power systems must be actively managed to maintain a steady balance between supply and demand. This is already a complex task as demand varies continually. But what happens when supply becomes more variable and less certain, as with some renewable sources of electricity like wind and solar PV that fluctuate with the weather? to what extent can the resources that help power systems cope with the challenge of variability in demand also be applied to variability of supply? How large are these resources? and what share of electricity supply from variable renewables can they make possible? There is no one-size-fits-all answer. the ways electricity is produced, transported and consumed around the world exhibit great diversity. Grids can cross borders, requiring co-ordinated international policy, or can be distinct within a single country or region. and whether found in dispatchable power plants, storage facilities, interconnections for trade or on the demand side, the flexible resource that ensures the provision of reliable power in the face of uncertainty likewise differs enormously. Written for decision makers, Harnessing Variable Renewables: a Guide to the Balancing Challenge sheds light on managing power systems with large shares of variable renewables. It presents a new, step-by-step approach developed by the IEA to assess the flexibility of power systems, which identifies the already present resources that could help meet the twin challenges of variability and uncertainty.

Local Electricity Markets

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Author : Tiago Pinto
language : en
Publisher: Academic Press
Release Date : 2021-07-03

Local Electricity Markets written by Tiago Pinto and has been published by Academic Press this book supported file pdf, txt, epub, kindle and other format this book has been release on 2021-07-03 with Business & Economics categories.

Local Electricity Markets introduces the fundamental characteristics, needs, and constraints shaping the design and implementation of local electricity markets. It addresses current proposed local market models and lessons from their limited practical implementation. The work discusses relevant decision and informatics tools considered important in the implementation of local electricity markets. It also includes a review on management and trading platforms, including commercially available tools. Aspects of local electricity market infrastructure are identified and discussed, including physical and software infrastructure. It discusses the current regulatory frameworks available for local electricity market development internationally. The work concludes with a discussion of barriers and opportunities for local electricity markets in the future. Delineates key components shaping the design and implementation of local electricity market structure Provides a coherent view on the enabling infrastructures and technologies that underpin local market expansion Explores the current regulatory environment for local electricity markets drawn from a global panel of contributors Exposes future paths toward widespread implementation of local electricity markets using an empirical review of barriers and opportunities Reviews relevant local electricity market case studies, pilots and demonstrators already deployed and under implementation