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Long term impact of wind power generation in the Iberian day-ahead electricity market price

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  • Pereira, Adelino J.C.
  • Saraiva, João Tomé

Abstract

The Iberian power systems went through important changes at the legal, regulatory and organizational levels in the last 20 years. One of the most relevant ones was the increasing penetration of distributed generation, namely wind parks, together with the development of the common market involving Portugal and Spain. In Portugal, distributed generation is paid using feed in tariffs while in Spain it can choose between receiving a regulated feed in tariff or the market price plus a participation prize. The feed in scheme is now under discussion since it is argued that it represents an excessive cost that is internalized in the end user tariffs. However, this discussion is frequently conducted without complete knowledge of the real impact of wind power on the electricity market price, since it contributes to reduce the demand on the market thus inducing a price reduction. To clarify these issues we used a long term System Dynamics based model already reported in a previous publication to estimate the long term evolution of the market price. This model was applied to the Iberian generation system using different shares of wind power capacity to quantify the impact of wind power on the day-ahead electricity market price.

Suggested Citation

  • Pereira, Adelino J.C. & Saraiva, João Tomé, 2013. "Long term impact of wind power generation in the Iberian day-ahead electricity market price," Energy, Elsevier, vol. 55(C), pages 1159-1171.
    • Handle: RePEc:eee:energy:v:55:y:2013:i:c:p:1159-1171
    DOI: 10.1016/j.energy.2013.04.018
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    Cited by:

    1. Armin Leopold, 2016. "Energy related system dynamic models: a literature review," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 24(1), pages 231-261, March.
    2. Xu, Xiao & Hu, Weihao & Cao, Di & Huang, Qi & Liu, Zhou & Liu, Wen & Chen, Zhe & Blaabjerg, Frede, 2020. "Scheduling of wind-battery hybrid system in the electricity market using distributionally robust optimization," Renewable Energy, Elsevier, vol. 156(C), pages 47-56.
    3. Brancucci Martinez-Anido, Carlo & Brinkman, Greg & Hodge, Bri-Mathias, 2016. "The impact of wind power on electricity prices," Renewable Energy, Elsevier, vol. 94(C), pages 474-487.
    4. Pousinho, H.M.I. & Silva, H. & Mendes, V.M.F. & Collares-Pereira, M. & Pereira Cabrita, C., 2014. "Self-scheduling for energy and spinning reserve of wind/CSP plants by a MILP approach," Energy, Elsevier, vol. 78(C), pages 524-534.
    5. Sedighizadeh, Mostafa & Esmaili, Masoud & Esmaeili, Mobin, 2014. "Application of the hybrid Big Bang-Big Crunch algorithm to optimal reconfiguration and distributed generation power allocation in distribution systems," Energy, Elsevier, vol. 76(C), pages 920-930.
    6. Xiao, Yunpeng & Wang, Xifan & Wang, Xiuli & Dang, Can & Lu, Ming, 2016. "Behavior analysis of wind power producer in electricity market," Applied Energy, Elsevier, vol. 171(C), pages 325-335.
    7. Rubin, Ofir D. & Babcock, Bruce A., 2013. "The impact of expansion of wind power capacity and pricing methods on the efficiency of deregulated electricity markets," Energy, Elsevier, vol. 59(C), pages 676-688.
    8. Barroso, Manuel Monjas & Iniesta, José Balibrea, 2014. "A valuation of wind power projects in Germany using real regulatory options," Energy, Elsevier, vol. 77(C), pages 422-433.
    9. Cartelle Barros, Juan José & Lara Coira, Manuel & de la Cruz López, María Pilar & del Caño Gochi, Alfredo, 2015. "Assessing the global sustainability of different electricity generation systems," Energy, Elsevier, vol. 89(C), pages 473-489.
    10. Chang-Gi Min & Jong Keun Park & Don Hur & Mun-Kyeom Kim, 2015. "The Economic Viability of Renewable Portfolio Standard Support for Offshore Wind Farm Projects in Korea," Energies, MDPI, vol. 8(9), pages 1-20, September.
    11. Carreno-Madinabeitia, Sheila & Ibarra-Berastegi, Gabriel & Sáenz, Jon & Ulazia, Alain, 2021. "Long-term changes in offshore wind power density and wind turbine capacity factor in the Iberian Peninsula (1900–2010)," Energy, Elsevier, vol. 226(C).
    12. Ben-Moshe, Ori & Rubin, Ofir D., 2015. "Does wind energy mitigate market power in deregulated electricity markets?," Energy, Elsevier, vol. 85(C), pages 511-521.
    13. Stefano Cló & Gaetano D’Adamo, 2014. "The Impact of Solar Penetration on Solar and Gas Market Value: an application to the Italian Power Market," Working Papers 1405, Department of Applied Economics II, Universidad de Valencia.
    14. Ederer, Nikolaus, 2015. "The market value and impact of offshore wind on the electricity spot market: Evidence from Germany," Applied Energy, Elsevier, vol. 154(C), pages 805-814.
    15. Banshwar, Anuj & Sharma, Naveen Kumar & Sood, Yog Raj & Shrivastava, Rajnish, 2017. "Market based procurement of energy and ancillary services from Renewable Energy Sources in deregulated environment," Renewable Energy, Elsevier, vol. 101(C), pages 1390-1400.
    16. Colmenar-Santos, Antonio & Campíñez-Romero, Severo & Pérez-Molina, Clara & Mur-Pérez, Francisco, 2015. "Repowering: An actual possibility for wind energy in Spain in a new scenario without feed-in-tariffs," Renewable and Sustainable Energy Reviews, Elsevier, vol. 41(C), pages 319-337.

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