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The value of gas-fired power plants in markets with high shares of renewable energy

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  • Hörnlein, Lena

Abstract

Using a real options model, this paper quantifies a gas-fired power plant's operating value and the value of a new investment against the background of a market transition to renewable electricity. The model is run with recent data for Germany's power sector and for different types of gas-fired power plants.

Suggested Citation

  • Hörnlein, Lena, 2019. "The value of gas-fired power plants in markets with high shares of renewable energy," Energy Economics, Elsevier, vol. 81(C), pages 1078-1098.
    • Handle: RePEc:eee:eneeco:v:81:y:2019:i:c:p:1078-1098
    DOI: 10.1016/j.eneco.2019.04.013
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    References listed on IDEAS

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    More about this item

    Keywords

    Real options; Electricity; Investment; Gas-fired generation; Energy transition;
    All these keywords.

    JEL classification:

    • C6 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling
    • L9 - Industrial Organization - - Industry Studies: Transportation and Utilities
    • Q4 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy

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