Large Scale Deployment of Renewables for Electricity Generation

Comparisons of resource assessments suggest resource constraints are not an obstacle to the large-scale deployment of renewable energy technologies. Economic analysis identifies barriers to the adoption of renewable energy sources resulting from market structure, competition in an uneven playing field and various non-market place barriers. However, even if these barriers are removed, the problem of ‘technology lock-out’ remains. The key policy response is strategic deployment coupled with increased R&D support to accelerate the pace of improvement through market experience. The paper suggests significant contributions from various technologies, but does not assess their optimal or maximal market share

Optimal congestion treatment for bilateral electricity trading

How to treat transmission constraints in electricity markets that are not based on a pool but on bilateral trading? Three approaches are currently discussed: First, the system operator resolves constraints and socialises costs; second, physical transmission contracts; third, locational charging with the option of financial hedging. Socialisation of costs for constraint resolution results in inefficient dispatch and incorrect incentives for investment in generation. Physical contracts and locational charging designs have identical properties in a very simplified model world, but differ if transaction costs, illiquid markets and uncertainty about demand are considered. Physical transmission contracts are best designed as zonal access rights, but have to be centrally administered to be efficient. Only locational charging can cope with uncertainty and volatility of electricity demand efficiently and non-discriminatory

4th Congress of the European Project Quality Low Input Food

The fourth annual scientific congress of the QLIF project took place during 19-20 June 2008 at the occassion of the 16th IFOAM Organic World Congress in Modena, Italy, where ISOFAR also organized their 2nd Scientific Conference. During the Organic World Congress QLIF offered a series of five outstanding workshops where central organic themes were highlighted during a synthesis paper written by a team of QLIF authors. Subseqently, the workshops made room for an exhaustive, moderated discussions

How EU trade policy can enhance climate action Options to boost low-carbon investment and address carbon leakage. CEPS Policy Priorities for 2019-2024, 23 September 2019

In her Political Guidelines, Commission President-elect Ursula von der Leyen sets climate neutrality as one of the central objectives of a proposed European Green Deal. EU member states are now discussing whether to formally agree on an objective for climate neutrality in 2050. Some have already set deadlines – Finland as early as 2035. This has triggered reflection on the adequate policy mix, notably with a view to making a business case for low-carbon innovation and investment while addressing carbon leakage. The Commission President-elect thinks that this will require a carbon border tax. To address the strategic need for a robust EU framework for low-carbon investment, we recommend that the European Commission i) investigates the economic, legal, and administrative viability and implementation timeline of carbon price adjustments at the border, ii) examines the possibility to extend the EU Emissions Trading System to include consumption of carbon intensive materials and iii) explores the potential of product standards to achieve the same aim. All these approaches have different advantages and shortcomings in terms of political acceptability, effectiveness and implications for the world trade system. To support partner countries in advancing climate action, both bilateral and multilateral measures should be prepared

Integrating Transmission and Energy Markets Mitigates Market Power

Integrating Transmission and Energy Markets Mitigates Market Powe

Large Scale Deployment of Renewables for Electricity Generation

Comparisons of resource assessments suggest resource constraints are not an obstacle to the large-scale deployment of renewable energy technologies. Economic analysis identifies barriers to the adoption of renewable energy sources resulting from market structure, competition in an uneven playing field and various non-market place barriers. However, even if these barriers are removed, the problem of ‘technology lock-out’ remains. The key policy response is strategic deployment coupled with increased R&D support to accelerate the pace of improvement through market experience. The paper suggests significant contributions from various technologies, but does not assess their optimal or maximal market share.technology policy, renewable energy, learning externalities, market structure

Opening the Electricity Market to Renewable Energy: Making Better Use of the Grid

Opening the electricity market to renewable energy sources would create flexibility for the further integration of renewable energy, leading to considerably lower costs and emissions. This requires the electricity markets to be reorganized in three ways. Firstly, most trading, and therefore production decision-making, is completed at least one day prior to electricity production. But it must be possible to make adjustments on shorter timescales, in order to effectively utilize wind forecasts, which are only relatively accurate a few hours ahead of production. Secondly, demand for operating reserve to stabilize the grid varies with the uncertainty of forecasts for wind and other generation. Most power plants can offer operating reserve, but only together with electricity. At present, however, operating reserve is traded separately from electricity, often in long-term contracts. And thirdly, network operators generally compensate market participants for grid constraints. But with around 200 GWs of new wind and solar capacity being built by 2020, grid expansion must be combined with transparent, market-based congestion management. The introduction of an independent system operator offering an integrated platform for short-term power trading using a pricing system that internalises network constraints ("nodal pricing") could meet these conditions, allowing further openings of the power market for renewable electrical energy. Experience in the US and simulations for Europe show that international transmission capacity is up to 30% better utilized, congestion management alone yielding annual savings of 1 - 2 billion euros.Market design, renewable energy, nodal pricing, transmission

Optimal congestion treatment for bilateral electricity trading

How to treat transmission constraints in electricity markets that are not based on a pool but on bilateral trading? Three approaches are currently discussed: First, the system operator resolves constraints and socialises costs; second, physical transmission contracts; third, locational charging with the option of financial hedging. Socialisation of costs for constraint resolution results in inefficient dispatch and incorrect incentives for investment in generation. Physical contracts and locational charging designs have identical properties in a very simplified model world, but differ if transaction costs, illiquid markets and uncertainty about demand are considered. Physical transmission contracts are best designed as zonal access rights, but have to be centrally administered to be efficient. Only locational charging can cope with uncertainty and volatility of electricity demand efficiently and non-discriminatory. Qualitative arguments allow ranking of designs involving physical contracts and locational charging. Comparison with a system operator socialising costs requires network specific analysis.Electricity Networks, Constraint Management, Market Design, Bilateral Trading