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Efficient storage capacity in power systems with thermal and renewable generation

Author

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  • Bjarne Steffen
  • Christoph Weber

    (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen)

Abstract

Power systems with high shares of wind and solar power have to balance their intermittent nature. Pumped†hydro storage plants can provide the required flexibility, while thermal backup plants offer an alternative. This paper proposes a model based on peak†load†pricing theory to describe the efficient technology portfolio. Drawing on a load duration curve, we derive the efficient storage capacity and discuss its dependence on cost parameters. It is shown that renewable generation affects the efficient storage capacity by changing the shape of the residual load duration curve, while limited time periods with renewable generation in excess of load do not necessarily affect the level of storage. A case study for Germany applies the model and highlights the impact of CO2 prices on storage efficiency.

Suggested Citation

  • Bjarne Steffen & Christoph Weber, 2011. "Efficient storage capacity in power systems with thermal and renewable generation," EWL Working Papers 1104, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Aug 2011.
    • Handle: RePEc:dui:wpaper:1104
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    More about this item

    Keywords

    electricity storage; peak†load†pricing; renewable energy;
    All these keywords.

    JEL classification:

    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources

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