IDEAS home Printed from https://ideas.repec.org/a/aen/journl/ej40-si1-leisen.html
   My bibliography  Save this article

Evaluation of Risks for Electricity Generation Companies through Reconfiguration of Bidding Zones in Extended Central Western Europe

Author

Listed:
  • Caroline Deilen, Tim Felling, Robin Leisen, and Christoph Weber

Abstract

In Central Western Europe, a reconfiguration of bidding zones for electricity is frequently discussed as a way to improve congestion management. The current EU guideline on Capacity Allocation and Congestion Management even envisages reviews of the bidding zone configuration (BZC) in regular intervals of three years. Such a change of BZCs gives rise to additional regulatory risk for generation companies. Their expected net present value depends on local prices, which are directly influenced by the BZC. The paper at hand develops a methodology to investigate the impact of this regulatory risk. Therefore the risk of bidding zone changes is modeled using a partly-meshed scenario tree. The risk factors reflected therein are uncertainties in grid developments, in combination with other risks such as changing coal and gas spreads, demand, or renewable infeed variations. Results are compared to the current BZC in Europe and to a nodal setup.

Suggested Citation

  • Caroline Deilen, Tim Felling, Robin Leisen, and Christoph Weber, 2019. "Evaluation of Risks for Electricity Generation Companies through Reconfiguration of Bidding Zones in Extended Central Western Europe," The Energy Journal, International Association for Energy Economics, vol. 0(The New E).
    • Handle: RePEc:aen:journl:ej40-si1-leisen
    as

    Download full text from publisher

    File URL: http://www.iaee.org/en/publications/ejarticle.aspx?id=3304
    Download Restriction: Access to full text is restricted to IAEE members and subscribers.
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Bucksteeg, Michael & Voswinkel, Simon & Blumberg, Gerald, 2023. "Improving flow-based market coupling by integrating redispatch potential - Evidence from a large-scale model," EconStor Preprints 270878, ZBW - Leibniz Information Centre for Economics.
    2. Yana Duan & Yang Sun & Yu Zhang & Xiaoqi Fan & Qinghuan Dong & Sen Guo, 2021. "Risk Evaluation of Electric Power Grid Investment in China Employing a Hybrid Novel MCDM Method," Mathematics, MDPI, vol. 9(5), pages 1-22, February.
    3. Bucksteeg, Michael & Voswinkel, Simon & Blumberg, Gerald, 2024. "Improving flow-based market coupling by integrating redispatch potential―Evidence from a large-scale model," Energy Policy, Elsevier, vol. 188(C).
    4. Felling, Tim, 2021. "Development of a genetic algorithm and its application to a bi-level problem of system cost optimal electricity price zone configurations," Energy Economics, Elsevier, vol. 101(C).
    5. Marco Sebastian Breder & Felix Meurer & Michael Bucksteeg & Christoph Weber, 2022. "Spatial Incentives for Power-to-hydrogen through Market Splitting," EWL Working Papers 2203, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Jul 2022.

    More about this item

    JEL classification:

    • F0 - International Economics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:aen:journl:ej40-si1-leisen. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: David Williams (email available below). General contact details of provider: https://edirc.repec.org/data/iaeeeea.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.