IDEAS home Printed from https://ideas.repec.org/a/eee/eneeco/v65y2017icp75-86.html
   My bibliography  Save this article

Where do all the windmills go? Influence of the institutional setting on the spatial distribution of renewable energy installation

Author

Listed:
  • Pechan, A.

Abstract

Promoting renewable energy sources is one policy response to climate change. Not only is there currently a debate over the best policy instrument, it is also discussed whether the renewable energy production should be expanded centralized at locations with the highest production potential or decentralized close to load. It is yet not fully understood what influences the spatial distribution of renewable energy installation.

Suggested Citation

  • Pechan, A., 2017. "Where do all the windmills go? Influence of the institutional setting on the spatial distribution of renewable energy installation," Energy Economics, Elsevier, vol. 65(C), pages 75-86.
    • Handle: RePEc:eee:eneeco:v:65:y:2017:i:c:p:75-86
    DOI: 10.1016/j.eneco.2017.04.034
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0140988317301457
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.eneco.2017.04.034?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

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

    References listed on IDEAS

    as
    1. Cludius, Johanna & Hermann, Hauke & Matthes, Felix Chr. & Graichen, Verena, 2014. "The merit order effect of wind and photovoltaic electricity generation in Germany 2008–2016: Estimation and distributional implications," Energy Economics, Elsevier, vol. 44(C), pages 302-313.
    2. Hiroux, C. & Saguan, M., 2010. "Large-scale wind power in European electricity markets: Time for revisiting support schemes and market designs?," Energy Policy, Elsevier, vol. 38(7), pages 3135-3145, July.
    3. Grimm, Veronika & Martin, Alexander & Schmidt, Martin & Weibelzahl, Martin & Zöttl, Gregor, 2016. "Transmission and generation investment in electricity markets: The effects of market splitting and network fee regimes," European Journal of Operational Research, Elsevier, vol. 254(2), pages 493-509.
    4. Hsu, Michael, 1997. "An introduction to the pricing of electric power transmission," Utilities Policy, Elsevier, vol. 6(3), pages 257-270, September.
    5. Wright, Glen, 2012. "Facilitating efficient augmentation of transmission networks to connect renewable energy generation: the Australian experience," Energy Policy, Elsevier, vol. 44(C), pages 79-91.
    6. Hirth, Lion & Müller, Simon, 2016. "System-friendly wind power," Energy Economics, Elsevier, vol. 56(C), pages 51-63.
    7. Florian Leuthold & Hannes Weigt & Christian Hirschhausen, 2012. "A Large-Scale Spatial Optimization Model of the European Electricity Market," Networks and Spatial Economics, Springer, vol. 12(1), pages 75-107, March.
    8. Goetzke, Frank & Rave, Tilmann, 2016. "Exploring heterogeneous growth of wind energy across Germany," Utilities Policy, Elsevier, vol. 41(C), pages 193-205.
    9. Hirth, Lion, 2013. "The market value of variable renewables," Energy Economics, Elsevier, vol. 38(C), pages 218-236.
    10. Schill, Wolf-Peter & Egerer, Jonas & Rosellón, Juan, 2015. "Testing Regulatory Regimes for Power Transmission Expansion with Fluctuating Demand and Wind Generation," EconStor Open Access Articles and Book Chapters, ZBW - Leibniz Information Centre for Economics, vol. 47(1), pages 1-28.
    11. Schmid, Eva & Pahle, Michael & Knopf, Brigitte, 2013. "Renewable electricity generation in Germany: A meta-analysis of mitigation scenarios," Energy Policy, Elsevier, vol. 61(C), pages 1151-1163.
    12. Sensfuß, Frank & Ragwitz, Mario & Genoese, Massimo, 2008. "The merit-order effect: A detailed analysis of the price effect of renewable electricity generation on spot market prices in Germany," Energy Policy, Elsevier, vol. 36(8), pages 3076-3084, August.
    13. Weigt, Hannes & Jeske, Till & Leuthold, Florian & von Hirschhausen, Christian, 2010. ""Take the long way down": Integration of large-scale North Sea wind using HVDC transmission," Energy Policy, Elsevier, vol. 38(7), pages 3164-3173, July.
    14. Hitaj, Claudia & Löschel, Andreas, 2019. "The impact of a feed-in tariff on wind power development in Germany," Resource and Energy Economics, Elsevier, vol. 57(C), pages 18-35.
    15. Butler, Lucy & Neuhoff, Karsten, 2008. "Comparison of feed-in tariff, quota and auction mechanisms to support wind power development," Renewable Energy, Elsevier, vol. 33(8), pages 1854-1867.
    16. Lamy, Julian V. & Jaramillo, Paulina & Azevedo, Inês L. & Wiser, Ryan, 2016. "Should we build wind farms close to load or invest in transmission to access better wind resources in remote areas? A case study in the MISO region," Energy Policy, Elsevier, vol. 96(C), pages 341-350.
    17. Grothe, Oliver & Müsgens, Felix, 2013. "The influence of spatial effects on wind power revenues under direct marketing rules," Energy Policy, Elsevier, vol. 58(C), pages 237-247.
    18. Elberg, Christina & Hagspiel, Simeon, 2015. "Spatial dependencies of wind power and interrelations with spot price dynamics," European Journal of Operational Research, Elsevier, vol. 241(1), pages 260-272.
    19. Lion Hirth, 2015. "The Optimal Share of Variable Renewables: How the Variability of Wind and Solar Power affects their Welfare-optimal Deployment," The Energy Journal, International Association for Energy Economics, vol. 0(Number 1).
    20. Ehrenmann, Andreas & Smeers, Yves, 2005. "Inefficiencies in European congestion management proposals," Utilities Policy, Elsevier, vol. 13(2), pages 135-152, June.
    21. Lijesen, Mark G., 2007. "The real-time price elasticity of electricity," Energy Economics, Elsevier, vol. 29(2), pages 249-258, March.
    22. OGGIONI, Giorgia & SMEERS, Yves, 2013. "Market failures of market coupling and counter-trading in Europe: an illustrative model based discussion," LIDAM Reprints CORE 2553, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
    23. Lion Hirth, 2013. "The Market Value of Variable Renewables. The Effect of Solar and Wind Power Variability on their Relative Price," RSCAS Working Papers 2013/36, European University Institute.
    24. Chao, Hung-Po & Peck, Stephen C, 1998. "Reliability Management in Competitive Electricity Markets," Journal of Regulatory Economics, Springer, vol. 14(2), pages 189-200, September.
    25. Dong, C.G., 2012. "Feed-in tariff vs. renewable portfolio standard: An empirical test of their relative effectiveness in promoting wind capacity development," Energy Policy, Elsevier, vol. 42(C), pages 476-485.
    26. Schmidt, J. & Lehecka, G. & Gass, V. & Schmid, E., 2013. "Where the wind blows: Assessing the effect of fixed and premium based feed-in tariffs on the spatial diversification of wind turbines," Energy Economics, Elsevier, vol. 40(C), pages 269-276.
    27. Lewis, Geoffrey McD., 2010. "Estimating the value of wind energy using electricity locational marginal price," Energy Policy, Elsevier, vol. 38(7), pages 3221-3231, July.
    28. Schaber, Katrin & Steinke, Florian & Mühlich, Pascal & Hamacher, Thomas, 2012. "Parametric study of variable renewable energy integration in Europe: Advantages and costs of transmission grid extensions," Energy Policy, Elsevier, vol. 42(C), pages 498-508.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Paul Simshauser & Farhad Billimoria & Craig Rogers, 2021. "Optimising VRE plant capacity in Renewable Energy Zones," Working Papers EPRG2121, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
    2. Anselm Eicke, Tarun Khanna, and Lion Hirth, 2020. "Locational Investment Signals: How to Steer the Siting of New Generation Capacity in Power Systems?," The Energy Journal, International Association for Energy Economics, vol. 0(Number 6), pages 281-304.
    3. Lu, Qinan & Cheng, Nieyan & Zhang, Wendong & Liu, Pengfei, 2023. "Disamenity or premium: Do electricity transmission lines affect farmland values and housing prices differently?," Journal of Housing Economics, Elsevier, vol. 62(C).
    4. Meus, Jelle & De Vits, Sarah & S'heeren, Nele & Delarue, Erik & Proost, Stef, 2021. "Renewable electricity support in perfect markets: Economic incentives under diverse subsidy instruments," Energy Economics, Elsevier, vol. 94(C).
    5. Klaus Eisenack & Mathias Mier, 2019. "Peak-load pricing with different types of dispatchability," Journal of Regulatory Economics, Springer, vol. 56(2), pages 105-124, December.
    6. Meya, Jasper N. & Neetzow, Paul, 2021. "Renewable energy policies in federal government systems," Energy Economics, Elsevier, vol. 101(C).
    7. Savelli, Iacopo & Hardy, Jeffrey & Hepburn, Cameron & Morstyn, Thomas, 2022. "Putting wind and solar in their place: Internalising congestion and other system-wide costs with enhanced contracts for difference in Great Britain," Energy Economics, Elsevier, vol. 113(C).
    8. Jasper Meya & Paul Neetzow, 2019. "Renewable energy policies in federal government systems," Working Papers V-423-19, University of Oldenburg, Department of Economics, revised Jul 2019.
    9. Simshauser, Paul, 2021. "Renewable Energy Zones in Australia's National Electricity Market," Energy Economics, Elsevier, vol. 101(C).
    10. Bauknecht, Dierk & Funcke, Simon & Vogel, Moritz, 2020. "Is small beautiful? A framework for assessing decentralised electricity systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 118(C).
    11. Simshauser, P., 2021. "Renewable Energy Zones in Australia’s National Electricity Market," Cambridge Working Papers in Economics 2119, Faculty of Economics, University of Cambridge.
    12. Xia, Fang & Lu, Xi & Song, Feng, 2020. "The role of feed-in tariff in the curtailment of wind power in China," Energy Economics, Elsevier, vol. 86(C).
    13. Schmidt, Lukas & Zinke, Jonas, 2020. "One price fits all? Wind power expansion under uniform and nodal pricing in Germany," EWI Working Papers 2020-6, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    14. Ruderer, Dominik & Zöttl, Gregor, 2018. "Transmission pricing and investment incentives," Utilities Policy, Elsevier, vol. 55(C), pages 14-30.
    15. Simshauser, Paul & Billimoria, Farhad & Rogers, Craig, 2022. "Optimising VRE capacity in Renewable Energy Zones," Energy Economics, Elsevier, vol. 113(C).
    16. Bucksteeg, Michael, 2019. "Modelling the impact of geographical diversification of wind turbines on the required firm capacity in Germany," Applied Energy, Elsevier, vol. 235(C), pages 1476-1491.
    17. Engelhorn, Thorsten & Müsgens, Felix, 2021. "Why is Germany’s energy transition so expensive? Quantifying the costs of wind-energy decentralisation," Resource and Energy Economics, Elsevier, vol. 65(C).
    18. Bjørnebye, Henrik & Hagem, Cathrine & Lind, Arne, 2018. "Optimal location of renewable power," Energy, Elsevier, vol. 147(C), pages 1203-1215.
    19. Obermüller, Frank, 2017. "Build Wind Capacities at Windy Locations? Assessment of System Optimal Wind Locations," EWI Working Papers 2017-9, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    20. Meus, Jelle & Van den Bergh, Kenneth & Delarue, Erik & Proost, Stef, 2019. "On international renewable cooperation mechanisms: The impact of national RES-E support schemes," Energy Economics, Elsevier, vol. 81(C), pages 859-873.
    21. Steinhäuser, J. Micha & Eisenack, Klaus, 2020. "How market design shapes the spatial distribution of power plant curtailment costs," Energy Policy, Elsevier, vol. 144(C).
    22. Heffron, Raphael J. & Körner, Marc-Fabian & Sumarno, Theresia & Wagner, Jonathan & Weibelzahl, Martin & Fridgen, Gilbert, 2022. "How different electricity pricing systems affect the energy trilemma: Assessing Indonesia's electricity market transition," Energy Economics, Elsevier, vol. 107(C).
    23. Rövekamp, Patrick & Schöpf, Michael & Wagon, Felix & Weibelzahl, Martin, 2023. "For better or for worse? On the economic and ecologic value of industrial demand side management in constrained electricity grids," Energy Policy, Elsevier, vol. 183(C).
    24. Fridgen, Gilbert & Michaelis, Anne & Rinck, Maximilian & Schöpf, Michael & Weibelzahl, Martin, 2020. "The search for the perfect match: Aligning power-trading products to the energy transition," Energy Policy, Elsevier, vol. 144(C).
    25. Grimm, Veronika & Sölch, Christian & Zöttl, Gregor, 2022. "Emissions reduction in a second-best world: On the long-term effects of overlapping regulations," Energy Economics, Elsevier, vol. 109(C).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Eising, Manuel & Hobbie, Hannes & Möst, Dominik, 2020. "Future wind and solar power market values in Germany — Evidence of spatial and technological dependencies?," Energy Economics, Elsevier, vol. 86(C).
    2. May, Nils, 2017. "The impact of wind power support schemes on technology choices," Energy Economics, Elsevier, vol. 65(C), pages 343-354.
    3. Odeh, Rodrigo Pérez & Watts, David, 2019. "Impacts of wind and solar spatial diversification on its market value: A case study of the Chilean electricity market," Renewable and Sustainable Energy Reviews, Elsevier, vol. 111(C), pages 442-461.
    4. Bernath, Christiane & Deac, Gerda & Sensfuß, Frank, 2021. "Impact of sector coupling on the market value of renewable energies – A model-based scenario analysis," Applied Energy, Elsevier, vol. 281(C).
    5. Meus, Jelle & De Vits, Sarah & S'heeren, Nele & Delarue, Erik & Proost, Stef, 2021. "Renewable electricity support in perfect markets: Economic incentives under diverse subsidy instruments," Energy Economics, Elsevier, vol. 94(C).
    6. Brown, T. & Reichenberg, L., 2021. "Decreasing market value of variable renewables can be avoided by policy action," Energy Economics, Elsevier, vol. 100(C).
    7. Marc Baudry & Clément Bonnet, 2016. "Demand pull isntruments and the development of wind power in Europe: A counter-factual analysis," Working Papers 1607, Chaire Economie du climat.
    8. Thao Pham & Killian Lemoine, 2020. "Impacts of subsidized renewable electricity generation on spot market prices in Germany : Evidence from a GARCH model with panel data," Working Papers hal-02568268, HAL.
    9. Ländner, Eva-Maria & Märtz, Alexandra & Schöpf, Michael & Weibelzahl, Martin, 2019. "From energy legislation to investment determination: Shaping future electricity markets with different flexibility options," Energy Policy, Elsevier, vol. 129(C), pages 1100-1110.
    10. Grimm, Veronika & Rückel, Bastian & Sölch, Christian & Zöttl, Gregor, 2021. "The impact of market design on transmission and generation investment in electricity markets," Energy Economics, Elsevier, vol. 93(C).
    11. Marc Baudry & Clément Bonnet, 2019. "Demand-Pull Instruments and the Development of Wind Power in Europe: A Counterfactual Analysis," Environmental & Resource Economics, Springer;European Association of Environmental and Resource Economists, vol. 73(2), pages 385-429, June.
    12. Jägemann, Cosima, 2014. "An illustrative note on the system price effect of wind and solar power - The German case," EWI Working Papers 2014-10, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    13. Mulder, Machiel & Scholtens, Bert, 2016. "A plant-level analysis of the spill-over effects of the German Energiewende," Applied Energy, Elsevier, vol. 183(C), pages 1259-1271.
    14. Zipp, Alexander, 2017. "The marketability of variable renewable energy in liberalized electricity markets – An empirical analysis," Renewable Energy, Elsevier, vol. 113(C), pages 1111-1121.
    15. Obermüller, Frank, 2017. "Build Wind Capacities at Windy Locations? Assessment of System Optimal Wind Locations," EWI Working Papers 2017-9, Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI).
    16. Engelhorn, Thorsten & Müsgens, Felix, 2018. "How to estimate wind-turbine infeed with incomplete stock data: A general framework with an application to turbine-specific market values in Germany," Energy Economics, Elsevier, vol. 72(C), pages 542-557.
    17. Javier L'opez Prol & Wolf-Peter Schill, 2020. "The Economics of Variable Renewables and Electricity Storage," Papers 2012.15371, arXiv.org.
    18. Raik Becker & Daniela Thrän, 2018. "Optimal Siting of Wind Farms in Wind Energy Dominated Power Systems," Energies, MDPI, vol. 11(4), pages 1-12, April.
    19. Kirkerud, Jon Gustav & Bolkesjø, Torjus Folsland & Trømborg, Erik, 2017. "Power-to-heat as a flexibility measure for integration of renewable energy," Energy, Elsevier, vol. 128(C), pages 776-784.
    20. Dillig, Marius & Jung, Manuel & Karl, Jürgen, 2016. "The impact of renewables on electricity prices in Germany – An estimation based on historic spot prices in the years 2011–2013," Renewable and Sustainable Energy Reviews, Elsevier, vol. 57(C), pages 7-15.

    More about this item

    Keywords

    Wind energy; Support scheme; Market design;
    All these keywords.

    JEL classification:

    • C63 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Computational Techniques
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy
    • D47 - Microeconomics - - Market Structure, Pricing, and Design - - - Market Design

    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:eee:eneeco:v:65:y:2017:i:c:p:75-86. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/eneco .

    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.