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Author Villalobos, C.; Negrete-Pincetic, M.; Figueroa, N.; Lorca, A.; Olivares, D.
Title The impact of short-term pricing on flexible generation investments in electricity markets Type
Year 2021 Publication Energy Economics Abbreviated Journal Energy Econ.
Volume 98 Issue Pages (down) 105213
Keywords Electricity markets; Pricing schemes; Market incentives; Flexibility; Renewable energy
Abstract The massive growth in the integration of variable renewable energy sources is producing several challenges in the operation of power systems and its associated markets. In this context, flexibility has become a critical attribute to allow the system to react to changes in generation or demand levels. Thus, it is critical for market signals at both short and long term scales to include flexibility features, to align agents' incentives with systemic flexibility requirements. In this paper, different pricing schemes for short-term markets are studied, based on various relaxations of the unit commitment problem, including convex-hull approximations, with the aim of representing operational flexibility requirements in a more explicit way. Extensive simulations illustrate the performance of the proposed schemes, as compared to conventional ones, in terms of the capability of the system to properly incentivize flexibility attributes, resulting in better agents' cost recovery and more variable renewable energy utilization. The results show that short-term pricing schemes considered improve the long-term signals for flexible investments but additional changes to market design are still required. Thus, there is a need to revisit historical practices for pricing rules by incorporating additional flexibility-related attributes into them. Several alternatives are discussed and policy recommendations based on these considerations are provided.
Corporate Author Thesis
Publisher Place of Publication Editor
Language Summary Language Original Title
Series Editor Series Title Abbreviated Series Title
Series Volume Series Issue Edition
ISSN 0140-9883 ISBN Medium
Area Expedition Conference
Notes WOS:000659334500023 Approved
Call Number UAI @ alexi.delcanto @ Serial 1401
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Author Perez, A.P.; Sauma, E.E.; Munoz, F.D.; Hobbs, B.F.
Title The Economic Effects of Interregional Trading of Renewable Energy Certificates in the US WECC Type
Year 2016 Publication Energy Journal Abbreviated Journal Energy J.
Volume 37 Issue 4 Pages (down) 267-295
Keywords Renewable Portfolio Standards; Renewable Energy Credits; Transmission planning; Western Electricity Coordinating Council; Electricity markets
Abstract In the U.S., individual states enact Renewable Portfolio Standards (RPSs) for renewable electricity production with little coordination. Each state imposes restrictions on the amounts and locations of qualifying renewable generation. Using a co-optimization (transmission and generation) planning model, we quantify the long run economic benefits of allowing flexibility in the trading of Renewable Energy Credits (RECs) among the U.S. states belonging to the Western Electricity Coordinating Council (WECC). We characterize flexibility in terms of the amount and geographic eligibility of out-of-state RECs that can be used to meet a state's RPS goal. Although more trade would be expected to have economic benefits, neither the size of these benefits nor the effects of such trading on infrastructure investments, CO2 emissions and energy prices have been previously quantified. We find that up to 90% of the economic benefits are captured if approximately 25% of unbundled RECs are allowed to be acquired from out of state. Furthermore, increasing REC trading flexibility does not necessarily result in either higher transmission investment costs or a substantial impact on CO2 emissions. Finally, increasing REC trading flexibility decreases energy prices in some states and increases them elsewhere, while the WECC-wide average energy price decreases.
Address [Perez, Andres P.; Sauma, Enzo E.] Pontificia Univ Catolica Chile, Ind & Syst Engn Dept, Santiago, Chile, Email: esauma@ing.puc.cl
Corporate Author Thesis
Publisher Int Assoc Energy Economics Place of Publication Editor
Language English Summary Language Original Title
Series Editor Series Title Abbreviated Series Title
Series Volume Series Issue Edition
ISSN 0195-6574 ISBN Medium
Area Expedition Conference
Notes WOS:000385912700012 Approved
Call Number UAI @ eduardo.moreno @ Serial 666
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