Sensitivity of electricity prices in energy-only markets with large amounts of zero marginal cost generation

Niina Helistö, Juha Kiviluoma, Hannele Holttinen

    Research output: Chapter in Book/Report/Conference proceedingConference article in proceedingsScientificpeer-review

    3 Citations (Scopus)

    Abstract

    This paper explores the sensitivity of electricity prices in energy-only markets with large amounts of wind and solar power. After electricity prices have fallen in many energy-only markets in recent years, the topic has been discussed in many studies with different approaches. The approach in this paper is to perform extensive electricity market simulations. The study is based on the North European power system, and it was carried out using a generation planning model to create reasonable capacity mixes for future, and a unit commitment and economic dispatch model to simulate electricity prices. The results show that the amount of base load generation capacity and overcapacity has a very high impact on electricity prices. The share of wind and solar power and the price of CO2 also have a clearly detectable, but less significant, impact.
    Original languageEnglish
    Title of host publication2017 14th International Conference on the European Energy Market, EEM 2017
    PublisherIEEE Institute of Electrical and Electronic Engineers
    ISBN (Electronic)978-1-5090-5499-2
    ISBN (Print)978-1-5090-5500-5
    DOIs
    Publication statusPublished - 14 Jul 2017
    MoE publication typeA4 Article in a conference publication
    Event14th International Conference on the European Energy Market, EEM 2017 - Dresden, Germany
    Duration: 6 Jun 20179 Jun 2017

    Conference

    Conference14th International Conference on the European Energy Market, EEM 2017
    Abbreviated titleEEM 2017
    CountryGermany
    CityDresden
    Period6/06/179/06/17

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    Keywords

    • electricity prices
    • power system modeling
    • solar power
    • unit commitment
    • wind power
    • Unit commitment

    Cite this

    Helistö, N., Kiviluoma, J., & Holttinen, H. (2017). Sensitivity of electricity prices in energy-only markets with large amounts of zero marginal cost generation. In 2017 14th International Conference on the European Energy Market, EEM 2017 [7981893] IEEE Institute of Electrical and Electronic Engineers . https://doi.org/10.1109/EEM.2017.7981893