wind power in the danish liberalised power market policy measures price impact and investor incentives wind power has a strong position at the danish electricity market mainly caused by high feed in tariffs in the 1990s investments in new wind power installations on land however have declined dramatically after the danish electricity market was liberalised in 1999 first the paper describes how policy measures directed towards wind power have been redesigned to match the liberalised market then we estimate the impact of the redesigned tariffs on the electricity prices finally we assess whether the new tariffs make an incentive to invest in wind power the paper concludes that the new tariffs not by itself make evidence for the actual danish recession in new wind power installations after the electricity reform the main causes could include a combination of problems in spatial planning high risk aversion of new wind turbine investors and perhaps more favourable support schemes in other countries

impacts of wind and solar spatial diversification on its market value a case study of the chilean electricity market abstract renewable energy is expected to become the main electricity source in the world in the coming decades with solar and wind power taking a big share of the energy supply although there has been a remarkable advance on renewable energy technologies their integration is still difficult for regulators market designers and system operators due to the high variability and limited predictability of solar and wind resources measures can be adopted to ease their integration among them geographical diversification there is plenty of literature about the diversification of solar and wind resources and there is a common conclusion greater dispersion smooths out power production however literature on the effects of spatial diversification on the power system electricity prices and renewable energy market value is much scarcer this paper studies the effects of spatial diversification and questions whether integration policies are incentivizing the placement of renewable generators where they provide the highest value to the electricity system in chile using real data and a simplified dispatch model the analysis presented shows evidence of the effects of diversification on wind and solar market value in chile results suggest that spatial diversification has a strong positive effect on the market value of renewable energy especially in scenarios with active transmission and hydro storage constraints wind market value may vary up to us 10 mw h depending on the level of diversification and the spatial and temporal constraints of the system and given current storage capacity of hydro reservoirs the solar market value may increase us 5 mw h due to diversification if transmission capacity is enough even though these results must be observed with caution because they depend on the assumptions made there is an important effect of renewable spatial diversification that should be observed by regulators

regional distribution of photovoltaic deployment in the uk and its determinants a spatial econometric approach abstract photovoltaic pv panels offer significant potential for contributing to the uk s energy policy goals relating to decarbonisation of the energy system security of supply and affordability the substantive drop in the cost of panels since 2007 coupled with the introduction of the feed in tariff fit scheme in 2010 has resulted in a rapid increase in installation of pv panels in the uk from 26 5mwp in 2009 to over 5gw by the end of 2014 yet there has been no comprehensive analysis of the determinants of pv deployment in the uk this paper addresses this gap by employing spatial econometrics methods to a recently available data set at a fine geographical detail following a traditional regression analysis a general to specific approach has been adopted where spatial variations in the relationships have been examined utilising the spatial durbin model using the cross sectional data relating to the uk nuts level 3 data empirical results indicate that demand for electricity population density pollution levels education level of households and housing types are among the factors that affect pv uptake in a region moreover lagrange multiplier test results indicate that the spatial durbin model may be properly applied to describe the pv uptake relationship in the uk as there are significant regional spillover effects

business models as drivers of the low carbon power system transition a multi level perspective abstract decarbonising the electrical power system holds a critical role in climate change mitigation recent developments in technology are helping change the current centralized paradigm into one of integrated distributed clean energy resources in spite of these developments radical transformation is not occurring at a speed to effectively meet environmental targets mostly due to the incumbent carbon lock in trajectory we argue that business model bm innovation dynamics are key drivers in accelerating the low carbon power system transition often operating irrespective of the underlying technology we combine bm theory with the multi level perspective on sociotechnical transitions to present a useful framework to analyze this potential transition this paper presents the application of this framework characterizing relevant bm dynamics of niche and regime business actors and supporting these with illustrative examples particularly we find that new actors in the distributed energy business are achieving market scale by offering financially innovative bms that do not require upfront costs from customers higher penetrations of renewable energy sources in liberalized electricity markets are destabilizing the historical bm of large centralized utilities through erosion of wholesale prices furthermore a shift towards distributed and dynamic energy resources further challenges incumbents and might bring opportunities for bms focused on active customer participation and social value creation as these tendencies are expected to accelerate we find analyses of bms will have important relevance for future power system transition research

quantifying the effect of renewable generation on day ahead electricity market prices the spanish case abstract the penetration of renewable generation has grown since the electricity sector has been deregulated to account for that this paper proposes a methodology to estimate the downward effect of renewable generation participation upon the day ahead electricity market prices since such an effect is quite intuitive observing the merit order of the generating units the european electricity market matching algorithm emma is currently based on euphemia price coupling of regions though there are several differences among countries across europe the new algorithm proposed uses market orders which include aggregate hourly orders such as aggregate supply and demand curves these orders are simple orders and the marginal price is affected by complex orders especially by the minimum income condition mic used in the iberian electricity market and considered in our proposed algorithm a case study of the spanish day ahead electricity market is evaluated for 2015 for which a daily generation sample is composed of 16 days in 2015 the sample is created following the characteristics of thermal production renewable production and inframarginal production the conclusions are drawn comparing the simulations of the real marginal prices and the new marginal prices after incorporating renewable generation participation into the aggregate demand curve at the maximum price

the impact of intraday markets on the market value of flexibility decomposing effects on profile and the imbalance costs abstract an increasing share of variable renewable energy sources vres basically affects the electricity price formation in two ways 1 the so called merit order effect tends to lower the base price level and challenges conventional plants to remain profitable 2 due to the variable nature of renewable energy infeed the short term demand for flexibility increases and changes the volatility of electricity prices the more variable prices offer opportunities for controllable electricity producers ceps who provide up and down ramping flexibility to increase their revenues in contrast the vres with high degrees of simultaneity tend to pay for this flexibility in the electricity spot market to reduce their imbalance exposure the intraday market idm for electricity has gained importance for the market value of different technologies lately and continues to expand due to the increasing efforts to balance within day deviation from day ahead schedules this article presents a combination and extension of two existing models to capture the peculiarities of the intraday price formation and to analyze the impact of the idm on the market value of vres and ceps doing so the paper suggests an adjustment of the classical market value factor metric and to go beyond classical day ahead market dam information the article shows that market value factors mvfs can be stabilized if the idm delivers market based price signals for the costs of flexibility that are sufficient to activate flexibilities prior to the usually more expensive imbalance mechanism ibm yet the mvfs from single vre technologies will worsen if their market share is high enough to outweigh forecast errors from other technologies and if they become a permanent price maker in the idm and the ibm

auctions with variable supply uniform price versus discriminatory abstract we examine an auction in which the seller determines the supply after observing the bids we compare the uniform price and the discriminatory auction in a setting of supply uncertainty where uncertainty is caused by the interplay of two factors the seller s private information about marginal cost and the seller s incentive to sell the profit maximizing quantity given the received bids in every symmetric mixed strategy equilibrium bidders submit higher bids in the uniform price auction than in the discriminatory auction in the two bidder case this result extends to the set of rationalizable strategies as a consequence we find that the uniform price auction generates a higher expected revenue for the seller and a higher trade volume

inducing truthful revelation of generator reliability abstract liberalised electricity markets often include a capacity remuneration mechanism to allow generation firms recover their fixed costs various de rating factors and or penalties have been incorporated into such mechanisms in order to reward the unit based on the contribution they make to system security which in turn depends on the unit s reliability however this reliability is known to the firm but not to the regulator we adopt a mechanism design approach for capacity payments based on a declaration by the firm of their reliability the mechanism scales payments and penalties according to this declared reliability such that the firm s profit maximising strategy is to truthfully reveal its reliability a stochastic mixed complementarity problem mcp is used to model the interactions between the firms and we apply this methodology to a test system using irish electricity market data truth telling is induced increasing the efficiency of capacity payments while eliminating the requirement for the regulator to allocate resources to discovering reliability

market performance and bidders bidding behavior in the new york transmission congestion contract market abstract using publicly available bidder level bids data for transmission congestion contracts tccs and the realized awards of tccs in the nyiso monthly reconfiguration auctions from june 2000 to december 2004 we examine both market performance and bidders bidding behavior in the auctions the data show significant under pricing in the realized awards of tccs theories suggest that under pricing may arise from risk aversion monopsonistic market power or winner s curse our empirical analysis illustrates that all of the three effects play a role in the nyiso tccs market both market performance and bidders bidding strategies can be best explained by the theoretical model with asymmetric information and risk averse bidders

strategic trading behavior and price distortion in a manipulated market anatomy of a squeeze abstract this paper investigates an attempted delivery squeeze in a bond futures contract traded in london using cash and futures trades of dealers and customers we analyze their strategic trading behavior price distortion and learning in a market manipulation setting we argue that marked differences in settlement failure penalties in the cash and futures markets create conditions that favor squeezes we recommend that regulators require special flagging of forward term repurchase agreements on the key deliverables that span futures contract maturity dates and that exchanges mark to market their contract specifications more frequently or consider a cash settled contract on a basket of bonds

the private and public economics of renewable electricity generation generating electricity from renewable sources is more expensive than conventional approaches but reduces pollution externalities analyzing the tradeoff is much more challenging than often presumed because the value of electricity is extremely dependent on the time and location at which it is produced which is not very controllable with some renewables such as wind and solar likewise the pollution benefits from renewable generation depend on what type of generation it displaces which also depends on time and location without incorporating these factors cost benefit analyses of alternatives are likely to be misleading other common arguments for subsidizing renewable power green jobs energy security and driving down fossil energy prices are unlikely to substantially alter the analysis the role of intellectual property spillovers is a strong argument for subsidizing energy science research but less persuasive as an enhancement to the value of installing current renewable energy technologies

variable renewable energy technologies in the turkish electricity market quantile regression analysis of the merit order effect abstract the share of variable renewable energy sources in power supply has increased significantly in many countries however this increase has also created problems in electricity markets while the average day ahead market price has declined in several markets the merit order effect the remuneration mechanisms in some countries have to be revised due to the surge in financial costs yet further research is needed to understand the implications of the merit order effect for remuneration mechanisms thoroughly accordingly this study aims to contribute to the literature through employing a quantile regression model to analyze the merit order effect and discuss its implications for the remuneration mechanism in turkish electricity market model results show significant negative merit order effect for both wind and run of river hydro technologies however this effect varies with respect to demand price level and technology moreover the contribution of these technologies to the total welfare in the turkish electricity market does not favor fixed price payments in conclusion it is recommended that the remuneration mechanism is revised to include the temporal value of variable renewable energy sources and electricity market design should reflect the locational value of variable renewable energy sources in turkey

the impact of public information on bidding in highway procurement auctions a number of papers in the theoretical auction literature show that the release of information regarding the seller s valuation of an item can cause bidders to bid more aggressively this widely accepted result in auction theory remains largely untested in the empirical literature recent theoretical work has also shown that this effect can be more pronounced in auctions with larger common cost uncertainty we examine the impact of a policy change by the oklahoma department of transportation that led to the release of the state s internal estimate of the costs to complete highway construction projects we perform a differences in differences analysis comparing bidding in texas a state that had a uniform policy of revealing the same information all throughout the period of analysis to bidding in oklahoma our results show that in comparison to texas auctions the average bid in oklahoma fell after the change in engineers cost estimate ece policy this decline in bids was even larger for projects where the common uncertainty in costs is greater moreover the within auction standard deviation of bids fell after the change in ece policy with the most significant decline observed again in projects with greater common cost uncertainty

the forbes 400 and the pareto wealth distribution abstract statistical regularities at the top end of the wealth distribution are examined using the forbes 400 lists during 1988 2003 we find that the wealth is distributed according to a pareto power law distribution with an average exponent of 1 49

bidding behavior in the longer term refinancing operations of the european central bank evidence from a panel sample selection model abstract this paper analyzes individual bidding data of the longer term refinancing operations ltros of the european central bank we investigate how banks bidding behavior is related to a series of exogenous variables including collateral costs interest rate expectations market volatility and to individual bank characteristics like country of origin size and experience a specific feature of these auctions is that the number and composition of bidders varies over time therefore we estimate panel sample selection models to control for a bank s endogenous participation decision we find that bidding strategies depend on the banks attributes yet different bidding behavior generally does not translate into differences concerning bidder success there is evidence for the winner s curse effect in ltros indicating a common value component in banks demand for longer term refinancing

compensating for the winner s curse experimental evidence abstract we conduct experiments on common value auctions with rationing in each auction the good is randomly allocated to one of the k highest bidders at the k 1 st highest price when k 1 bidders are rationed as the degree of rationing increases the equilibrium bid function increases consistent with prior literature we find that bidders suffer from the winner s curse and lose money on average however bids in the experiments do adjust in the appropriate direction as the degree of rationing changes providing support for the comparative statics implications of the theory our results are consistent with subjects having an intuitive understanding of the winner s curse but being unable to compute the equilibrium bid levels

redistribution effects of energy and climate policy the electricity market abstract energy and climate policies are usually seen as measures to internalize externalities however as a side effect the introduction of these policies redistributes wealth between consumers and producers and within these groups while redistribution is seldom the focus of the academic literature in energy economics it plays a central role in public debates and policy decisions this paper compares the distributional effects of two major electricity policies support schemes for renewable energy sources and co2 pricing we find that the redistribution effects of both policies are large and they work in opposed directions while renewables support transfers wealth from producers to consumers carbon pricing does the opposite more specifically we show that moderate amounts of wind subsidies can increase consumer surplus even if consumers bear the subsidy costs co2 pricing in contrast increases aggregated producer surplus even without free allocation of emission allowances however not all types of producers benefit these findings are derived from an analytical model of electricity markets and a calibrated numerical model of northwestern europe our findings imply that if policy makers want to avoid large redistribution they might prefer a mix of policies even if co2 pricing alone is the first best climate policy in terms of allocative efficiency

economic and technical challenges of flexible operations under large scale variable renewable deployment abstract fundamental characteristics of solar and wind power have generated controversy about their economic competitiveness and appropriate techniques for assessing their value this research presents an approach to quantify the economic value of variable renewable capacity and demonstrates its dependence on renewable deployment levels regional resource endowments fleet flexibility and trade assumptions it assesses economic and technical impacts of large scale renewable penetration by linking two models representing electric sector investments and detailed operations model results for california and texas suggest that operational constraints and costs of dispatchable generators e g minimum load levels ramping limits startup costs can impact renewable integration costs but the temporal and spatial variability of solar and wind are larger determinants of their value restrictions on transmission and regional coordination in capacity planning and dispatch decrease the economic value of variable renewable energy highlighting the potential roles of market design and trade energy storage is shown to be a valuable balancing asset at higher solar and wind penetration levels but potential revenues diminish with increased storage deployment

on the market impact of wind energy forecasts this paper presents an analysis of how day ahead electricity spot prices are affected by day ahead wind power forecasts demonstration of this relationship is given as a test case for the western danish price area of the nord pool s elspot market impact on the average price behaviour is investigated as well as that on the distributional properties of the price by using a non parametric regression model to assess the effects of wind power forecasts on the average behaviour the non linearities and time variations in the relationship are captured well and the effects are shown to be quite substantial furthermore by evaluating the distributional properties of the spot prices under different scenarios the impact of the wind power forecasts on the price distribution is proved to be considerable the conditional price distribution is moreover shown to be non gaussian this implies that forecasting models for electricity spot prices for which parameters are estimated by a least squares techniques will not have gaussian residuals hence the widespread assumption of gaussian residuals from electricity spot price models is shown to be inadequate for these model types the revealed effects are likely to be observable and qualitatively similar in other day ahead electricity markets significantly penetrated by wind power

impact of renewables on electricity markets do support schemes matter abstract rising renewable shares influence electricity markets in several ways among others average market prices are reduced and price volatility increases therefore the missing money problem in energy only electricity markets is more likely to occur in systems with high renewable shares nevertheless renewables are supported in many countries due to their expected benefits the kind of support instrument can however influence the degree to which renewables influence the market while fixed feed in tariffs lead to higher market impacts more market oriented support schemes such as market premiums quota systems and capacity based payments decrease the extent to which markets are affected this paper analyzes the market impacts of different support schemes for this purpose a new module is added to an existing bottom up simulation model of the electricity market in addition different degrees of flexibility in the electricity system are considered a case study for germany is used to derive policy recommendations regarding the choice of support scheme

where do all the windmills go influence of the institutional setting on the spatial distribution of renewable energy installation 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 i assess the effect of subsidy scheme and market design on the spatial distribution of wind energy installations by comparing a feed in tariffs versus market premiums and b uniform versus nodal pricing the analysis is based on theoretical considerations and using a six node test model that reflects the consumption and renewable resource distribution in several countries and regions the institutional setting has great influence on the spatial distribution and resulting system costs with uniform pricing a market premium only leads to a more decentralized expansion of renewable energy production than a tariff when sites share similar wind conditions spatially more distributed expansion of wind power performs better in terms of total costs and share of wind power in final demand when networks are restricted

on the economics of renewable energy sources abstract with the global expansion of renewable energy re technologies the provision of optimal re policy packages becomes an important task we review pivotal aspects regarding the economics of renewables that are relevant to the design of an optimal re policy many of which are to date unresolved we do so from three interrelated perspectives that a meaningful public policy framework for inquiry must take into account first we explore different social objectives justifying the deployment of re technologies and review model based estimates of the economic potential of re technologies i e their socially optimal deployment level second we address pivotal market failures that arise in the course of implementing the economic potential of re sources in decentralized markets third we discuss multiple policy instruments curing these market failures our framework reveals the requirements for an assessment of the relevant options for real world decision makers in the field of re policies this review makes it clear that there are remaining white areas on the knowledge map concerning consistent and socially optimal re policies

how does germany s green energy policy affect electricity market volatility an application of conditional autoregressive range models abstract based on a dynamic model for the high low range of electricity prices this article analyses the effects of germany s green energy policy on the volatility of the electricity market using european energy exchange data from 2000 to 2015 we find rather high volatility in the years 2000 2009 but also that the weekly price range has significantly declined in the period following the year 2009 this period is characterised by active regulation under the energy industry law enwg the eu emissions trading directive etd and the renewable energy law eeg in contrast to the preceding period price jumps are smaller and less frequent especially for day time hours implying that current policy measures are effective in promoting renewable energies while simultaneously upholding electricity market stability this is because the regulations strive towards a more and more flexible and market oriented structure which allows better integration of renewable energies and supports an efficient alignment of renewable electricity supply with demand

on the efficient market diffusion of intermittent renewable energies abstract capacity costs of renewable energies have been decreasing dramatically and are expected to fall further making them more competitive with fossils building on an analytically tractable peak load pricing model we analyze how intermittency of renewable energies affects the market diffusion that results from these lower costs in particular once renewables have become competitive by attaining the same levelized cost of electricity lcoe as fossils the marginal increase in efficient capacities due to a further cost reduction varies substantially initially it is small then it rises but it falls again once renewable capacities are large enough to satisfy the whole electricity demand at times of high availability if external costs of fossils are internalized by a pigouvian tax then perfect competition leads to efficient investments in renewable and fossil capacities even though we assume that only a subgroup of consumers can adapt their demand to price fluctuations that are caused by the intermittency of renewables moreover fossils receive a capacity payment through the market for their reliability in serving demand of non reactive consumers maximum electricity prices rise with the share of renewables if regulators impose a price cap this initially raises investments in renewables but the effect may reverse if the share of renewables is large

bidding behavior in sequential cattle auctions the objectives of this study are to investigate the institutional speciflcs of sequential cattle auctions and their role as determinants of prices institutional speciflcs are the order of sale according to quality a secret reserve price bidders multi unit demand and difierent types of bidders prices decline and bidders with a higher demand pay on average lower prices the estimation results show that declining prices are caused by the order of sale according to quality and the secret reserve price the results further show that bidders take the strategic efiect of sequential auctions and multi unit demand into account

toward a theory of the political entrepreneur evidence from local government political scientists have been increasingly interested in entrepreneurs individuals who change the direction and flow of politics in this research note we synthesize aspects of an economic approach to entrepreneurship with concepts used in political science we then tie these theoretical observations to the emergence of entrepreneurs in local governments and test components of our theory using observations from a large set of suburban municipal governments empirically we identify several conditions that affect the probability that an entrepreneur will emerge in a local government especially slack budgetary resources that the political entrepreneur can reallocate we also find that the probability with which an entrepreneur is found in local government is a function of the difficulty of overcoming collective action problems in a community

estimating the value of wind energy using electricity locational marginal price abstract there is an increasing interest in adding renewables such as wind to electricity generation portfolios in larger amounts as one response to concern about atmospheric carbon emissions from our energy system and the resulting climate change most policies with the aim of promoting renewables e g rps fit do not explicitly address siting issues which for wind energy are currently approached as the intersection of wind resource land control and transmission factors this work proposes the use of locational marginal price lmp the location and time specific cost of electricity on the wholesale market to signal locations where generation can address electricity system insufficiency after an examination of the spatial and temporal behavior of lmp in michigan over the first two years of wholesale market operation this work combines lmp with wind speed data to generate a value metric high value sites in michigan tend to be sites with higher wind speeds with the bulk of value accruing in the fall and winter seasons

the merit order effect a detailed analysis of the price effect of renewable electricity generation on spot market prices in germany the german feed in support of electricity generation from renewable energy sources has led to high growth rates of the supported technologies critics state that the costs for consumers are too high an important aspect to be considered in the discussion is the price effect created by renewable electricity generation this paper seeks to analyse the impact of privileged renewable electricity generation on the electricity market in germany the central aspect to be analysed is the impact of renewable electricity generation on spot market prices the results generated by an agent based simulation platform indicate that the financial volume of the price reduction is considerable in the short run this gives rise to a distributional effect which creates savings for the demand side by reducing generator profits in the case of the year 2006 the volume of the merit order effect exceeds the volume of the net support payments for renewable electricity generation which have to be paid by consumers

bidder behavior in multiunit auctions evidence from swedish treasury auctions we analyze a unique data set on multiunit auctions which contains the actual demand schedules of the bidders as well as the auction awards in over 400 swedish treasury auctions first we document that bidders vary their prices bid dispersion and the quantity demanded in response to increased uncertainty at the time of bidding second we find that bid shading can be explained by a winner s curse driven model in which each bidder submits only one bid despite the fact that the bidders in our data set use much richer bidding strategies third we explore the extent to which the received theories of multiunit auctions are able to offer insights into the bidder behavior we observe our empirical evidence is consistent with some of the predictions of the models of auctions that emphasize private information the winner s curse and the champion s plague while the models of multiunit auctions serve as useful guideposts our empirical findings also point to several new areas of research in multiunit auctions

the market value of variable renewables the effect of solar wind power variability on their relative price this paper provides a comprehensive discussion of the market value of variable renewable energy vre the inherent variability of wind speeds and solar radiation affects the price that vre generators receive on the market market value during windy and sunny times the additional electricity supply reduces the prices because the drop is larger with more installed capacity the market value of vre falls with higher penetration rate this study aims to develop a better understanding on how the market value with penetration and how policies and prices affect the market value quantitative evidence is derived from a review of published studies regression analysis of market data and the calibrated model of the european electricity market emma we find the value of wind power to fall from 110 of the average power price to 50 80 as wind penetration increases from zero to 30 of total electricity consumption for solar power similarly low value levels are reached already at 15 penetration hence competitive large scale renewable deployment will be more difficult to accomplish than as many anticipate

financial asset demand is elastic evidence from new issues of federal home loan bank debt abstract we estimate the slope of the demand curve for newly auctioned fhlb discount notes and investigate the impacts of arbitrage risk and heterogeneity of investor beliefs on demand elasticity our unique dataset of roughly 2900 observations of two price quantity pairs the first from a pre auction dealer survey the second from actual auction results provides the quantity shift necessary to identify demand in contrast to previous findings of downward sloping demand curves for equities we show that demand for newly issued fhlb notes is nearly perfectly elastic during normal market conditions we find however that frictions like arbitrage risk and to a lesser extent heterogeneity of investor beliefs negatively affect elasticity and explain the nearly 50 drop in elasticity observed during the recent financial crisis

do support systems for res e reduce eu ets driven electricity prices abstract support systems for electricity from renewable energy sources res e can reduce electricity prices which have also been influenced by a co2 emission trading scheme ets additional res e substitutes electricity from fossil fuels and thus co2 emissions are reduced the demand for emission reductions is lowered as a result the co2 price is also reduced consequently the wholesale price for electricity decreases however most res e support systems are financed via the electricity market which increases the retail electricity price an assessment for germany shows that retail electricity prices in the first trading period of the eu ets 2005 2007 are lowered by 2 6 euro mwh due to additional res e considering the complete eu the effect is substantially higher this paper describes the effect and the influence of different policy designs it develops an approach for assessing the effect and applies it for the case of germany and roughly estimates the effect for the eu

entrepreneurial personalities in political leadership societies around the globe respond to the contemporary technological and economic change by defining entrepreneurship and innovation as core principles for future competitive advantage does this rise of the entrepreneurial society also imply that entrepreneurial personalities are becoming increasingly widespread and powerful in political leadership joseph a schumpeter already argued that highly influential entrepreneurs are unique and show a certain personality pattern that can be described as being not only high in creativity and change orientation but also high in competitiveness and rule breaking it is interesting to ask whether such schumpeterian personalities indeed play an increasingly important role in political leadership given that daily routines of policy leaders at least at first glance usually require rather non entrepreneurial strategies such as careful risk averse diplomacy to address this question we first survey the existing literature on personality and political leadership we further present a novel personality analysis of an influential business leader that recently made a transition to political leadership donald j trump the incumbent us president employing a language based computerized method of analyzing twitter statements we compare his online personality to the online personality of other influential entrepreneurs and business managers who do not engage in political leadership the results indicate that trump is indeed distinct in that he shows stronger features of a schumpeterian personality however he is also comparatively high in neuroticism we discuss these findings focusing on the potential implications of a concentration of entrepreneurial mindsets in political leadership

electric sector capacity planning under uncertainty climate policy and natural gas in the us abstract this research investigates the dynamics of capacity planning and dispatch in the us electric power sector under a range of technological economic and policy related uncertainties using a two stage stochastic programming approach model results suggest that the two most critical risks in the near term planning process of the uncertainties considered here are natural gas prices and the stringency of climate policy stochastic strategies indicate that some near term hedging from lower cost wind and nuclear may occur but robustly demonstrate that delaying investment and waiting for more information can be optimal to avoid stranding capital intensive assets hedging strategies protect against downside losses while retaining the option value of deferring irreversible commitments until more information is available about potentially lucrative market opportunities these results are explained in terms of the optionality of investments in the electric power sector leading to more general insights about uncertainty learning and irreversibility the stochastic solution is especially valuable if decision makers do not sufficiently account for the potential of climate constraints in future decades or if fuel price projections are outdated

some evidence on the winner s curse comment the theory of auctions has developed extensively since robert b wilson s 1977 seminal paper due to the complexity of equilibrium strategies however empirical researchers have been slow to incorporate and test the most basic theoretical precepts typical empirical studies estimate ad hoc bidding models with no attempt to ascertain whether the implied behaviors are theoretically plausible the recent paper by stuart e thiel 1988 attempts to bridge this gap thiel obtains closed form equilibrium bidding functions that are theoretically motivated and linear in parameters and which facilitate empirical estimation and testing if widely applicable thiel s empirical approach would constitute a major methodological breakthrough unfortunately thiel s approach applies only in special cases that are of limited practical interest linear bidding strategies emerge only under circumstances that are unlikely in the real world the limited range of thiel s approach may not be apparent to casual readers of his paper even when linear strategies do exist they are not unique under the special assumptions of thiel s model for each nash equilibrium in linear strategies there exists a related family of nonlinear strategies thus further justification must be found for basing empirical research on the linear specification we also note a significant error in thiel s work the symmetric strategies he derives on the basis of order statistics do not constitute a nash equilibrium we derive proper expressions for the symmetric nash strategies and discuss a specification error in thiel s regression analysis that would account for the mixed results obtained in his application to the highway construction industry

forward looking behavior in ecb liquidity auctions evidence from the pre crisis period abstract using data from the pre crisis period we investigate banks joint bidding behavior in the ecb s main refinancing operations mro and longer term refinancing operations ltro we test whether banks bid at lower rates in mros before the ltro and at higher rates after the ltro compared to other operations we motivate this by findings from the auction literature suggesting that agents bidding behavior is forward looking and takes sequences of future auctions into account we offer two findings first we find that in general banks bid in the mro before the ltro at lower rates as compared to other mros moreover mro participants that also bid in the following ltro bid at even lower rates compared to peers not bidding in the ltro these findings support the hypothesis that banks view obtaining liquidity from the two operations as a substitute second we find that banks generally bid more aggressively in the mro after the ltro banks that participated also in the ltro preceding the mro bid at substantially higher rates these findings reflect that short banks with potentially large net liquidity needs in the mro after the ltro bid more aggressively although size plays a considerable role for bidding behavior the conclusions are valid for banks of different sizes

large scale wind power integration and wholesale electricity trading benefits estimation via an ex post approach abstract the integration of large scale wind power has brought about a series of challenges to the power industry but at the same time a number of benefits are being realized among those the ability of wind power to cause a decline in the electricity market prices has been recognized in quantifying this effect some models used in recent years are based on simulations of the market supply side and the price clearing process the accuracy of the estimates depend on the quality of the input data the veracity of the adopted scenarios and the rigorousness of the solution technique in this work a series of econometric techniques based on actual ex post wind power and electricity price data are implemented for the estimation of the impact of region wide wind power integration on the local electricity market clearing prices and the trading savings that stem from this effect the model is applied to the case of spain where the estimated savings are compared against actual credit and bonus expenses to ratepayers the implications and extent of these results for current and future renewable energy policy making are discussed

value of technology in the u s electric power sector impacts of full portfolios and technological change on the costs of meeting decarbonization goals abstract power sector decarbonization is an important pillar of climate mitigation efforts but perspectives differ about the relative competitiveness of generation technologies and how limited portfolio approaches e g where non renewable generation options are prohibited could alter the costs and likelihoods of reaching emissions reduction goals the existing literature on impacts of technological availability and cost on electric sector planning typically use models that do not have sufficient technological spatial and temporal detail to adequately resolve the economic competitiveness of variable renewable energy vis a vis dispatchable generators using a state of the art energy economic model this work examines impacts of technological availability and advanced generation technologies on u s electricity market outcomes across a range of regional market and policy contexts we show that decarbonization costs are 11 76 higher as technological options are removed from consideration incremental compliance costs for a 95 co2 reduction below 2005 levels are roughly twice as high when new nuclear carbon capture equipped units and transmission are not allowed however the economic and technical implications of limited portfolios depend on the market and policy contexts e g costs are higher with stringent targets more extensive end use electrification and lower gas prices and the costs and capabilities of the remaining options the analysis demonstrates how lower temporal and spatial resolution models likely understate the value of technology by omitting key economic and technical features of high variable renewable pathways additionally the analysis quantifies how technological change can lower costs of emissions reductions by 7 73 and how low cost battery storage can provide a hedge against higher costs when technological portfolios are limited

repo auctions and the market for liquidity what is the nature of imperfections in the market for liquidity studying bidder level data from european central bank ecb repo auctions we find that this market appears to be informationally efficient in the sense that participants do not have private information about future short term rates however auction allocations affect banks subsequent behavior in a way that is consistent with a degree of allocational and operational inefficiency also large bidders appear to have better access to the interbank market than small ones finally the evidence suggests that the ecb uses collateral haircuts that do not equilibrate opportunity costs

representation of variable renewable energy sources in timer an aggregated energy system simulation model the power system is expected to play an important role in climate change mitigation variable renewable energy vre sources such as wind and solar power are currently showing rapid growth rates in power systems worldwide and could also be important in future mitigation strategies it is therefore important that the electricity sector and the integration of vre are correctly represented in energy models this paper presents an improved methodology for representing the electricity sector in the long term energy simulation model timer using a heuristic approach to find cost optimal paths given system requirements and scenario assumptions regional residual load duration curves have been included to simulate curtailments storage use backup requirements and system load factor decline as the vre share increases the results show that for the usa and western europe at lower vre penetration levels backup costs form the major vre cost markup when solar power supplies more than 30 of the electricity demand the costs of storage and energy curtailments become increasingly important storage and curtailments have less influence on wind power cost markups in these regions as wind power supply is better correlated with electricity demand mitigation scenarios show an increasing vre share in the electricity mix implying also increasing contribution of vre for peak and mid load capacity in the current scenarios this can be achieved by at the same time installing less capital intensive gas fired power plants sensitivity analysis showed that greenhouse gas emissions from the electricity sector in the updated model are particularly sensitive to the availability of carbon capture and storage ccs and nuclear power and the costs of vre

future wind and solar power market values in germany evidence of spatial and technological dependencies abstract achieving ambitious climate targets entails an extensive utilisation of renewable energy sources however due to weather dependent fluctuations generation from variable renewable energy vre sources is characterised by significantly lower market values in comparison to conventional technologies reinforced by a decline in electricity prices this development poses interesting questions as to its drivers and to what extent market values of wind and solar power can be influenced by the design of electricity markets against this background a scenario based analysis is conducted to trace the future development of market values using endogenously derived electricity prices considering different regional and technological vre diversification strategies and investments into vre technologies on a myopic basis the results show a continued decline in market values with increasing regional discrepancies indicating a growing importance of interregional interdependencies for assessing the profitability of vre furthermore from a system point of view a more distributed allocation of onshore wind capacities to contend with declining market values does not always prove to stabilise market values by facilitating a more constant feed in pattern contrary to expectation finally replacing onshore with offshore wind energy appears to be beneficial as it can lead to an overall increase in the market values of offshore onshore as well as pv generation technologies compared to other mitigation strategies this result raise interesting questions about the systemic economic value of offshore wind despite its higher lcoe in the context of market integration of vre

electric sector policy technological change and u s emissions reductions goals results from the emf 32 model intercomparison project the energy modeling forum emf 32 study compares a range of coordinated scenarios to explore implications of u s climate policy options and technological change on the electric power sector harmonized policy scenarios including mass based emissions limits and various power sector only carbon tax trajectories across 16 models provide comparative assessments of potential impacts on electric sector investment and generation outcomes emissions reductions and economic implications this paper compares results across these policy alternatives including a variety of technological and natural gas price assumptions and summarizes robust findings and areas of disagreement across participating models under a wide range of policy technology and market assumptions model results suggest that future coal generation will decline relative to current levels while generation from natural gas wind and solar will increase though the pace and extent of these changes vary by policy scenario technological assumptions region and model climate policies can amplify trends already under way and make them less susceptible to future market changes the model results provide useful insights to a range of stakeholders but future research focused on intersectoral linkages in emission reductions e g the role of electrification effects of energy storage and better coverage of bioenergy with carbon capture and storage beccs can improve insights even further

empirical analysis of the merit order effect and the missing money problem in power markets with high res shares an on going debate in the energy economics and power market community raises the question if energy only power markets are increasingly failing due to growing feed in shares from subsidized renewable energy sources res the argument being essentially that the merit order effect of res production depresses day ahead spot market prices which in turn creates a situation where power plant owners cannot recover investment costs missing money problem we argue in short that energy only power markets are not failing in principle but are rather facing several market distortions that hinder proper market functioning namely 1 the gap between the electricity volume actually traded at day ahead spot markets versus the overall electricity consumption and 2 the regulatory assumption that variable res generation i e wind and photovoltaic pv truly has zero marginal operation and grid integration costs in this paper we show that both effects over amplify the well known merit order effect of res power feed in and indirectly also the missing money problem beyond a level that is explainable by underlying physical realities we empirically analyze the impacts of wind and pv power feed in on the day ahead market for the epex german austrian market zone a region that is already today experiencing significant feed in tariff fit subsidized res power feed in ca 20 fit share our analysis shows that if necessary regulatory adaptations are taken i e increasing the spot market s share of overall load demand and using the true marginal costs of res units in the merit order energy based power markets remain functional despite high res power feed in

an empirical study of auction revenue rankings the case of municipal bonds using a novel dataset of 386 rst price municipal bond auctions held in california i perform counterfactual revenue comparisons based on the theoretical result of milgrom and weber 1982 i show that the revenue in the second price auction is non parametrically identi ed and the counterfactual revenue in the english auction can be bounded in an informative way these results form a

spatial dependence in wind and optimal wind power allocation a copula based analysis abstract the investment decision on the placement of wind turbines is neglecting legal formalities mainly driven by the aim to maximize the expected annual energy production of single turbines the result is a concentration of wind farms at locations with high average wind speed while this strategy may be optimal for single investors maximizing their own return on investment the resulting overall allocation of wind turbines may be unfavorable for energy suppliers and the economy because of large fluctuations in the overall wind power output this paper investigates to what extent optimal allocation of wind farms in germany can reduce these fluctuations we analyze stochastic dependencies of wind speed for a large data set of german on and offshore weather stations and find that these dependencies turn out to be highly nonlinear but constant over time using copula theory we determine the value at risk of energy production for given allocation sets of wind farms and derive optimal allocation plans we find that the optimized allocation of wind farms may substantially stabilize the overall wind energy supply on daily as well as hourly frequency

performance of wholesale electricity markets with high wind penetration abstract this paper examines the impact of progressively deeper levels of wind generation and or abatement on the performance of a wholesale market and its incumbent thermal generators with non convex unit commitment constraints comparison is made to the result that marginal cost pricing should induce investors to build the least cost capacity mix since it is not clear that this will hold in renewable rich systems it is first found that unit commitment and forecast uncertainty do not cause significant departure from this result when the generator fleet is optimal optimality in this sense is determined in a capacity expansion problem that does not feature unit commitment and which allows thermal generators to be built or retired as greater renewable generation or abatement is mandated in contrast the wholesale market with no retirement of thermal generation experiences progressively greater disparity between total system prices and costs and lower returns to generators simply due to over capacity rather than any form of variability related market failure a carbon price is observed to be far superior to a renewable portfolio standard when the existing set of thermal generators do not retire but this difference is less stark when the generation mix is optimal the implications of these results for market design and system planning are then discussed

mechanism choice and strategic bidding in divisible good auctions an empirical analysis of the turkish treasury auction market we propose an estimation method to bound bidders marginal valuations in discriminatory auctions using individual bid level data and apply the method to data from the turkish treasury auction market using estimated bounds on marginal values we compute an upper bound on the inefficiency of realized allocations as well as bounds on how much additional revenue could have been realized in a counterfactual uniform price or vickrey auction we conclude that switching from a discriminatory auction to a uniform price or vickrey auction would not significantly increase revenue moreover such a switch would increase bidder expected surplus by at most 0 02 percent

balancing power and variable renewables three links abstract balancing power is used to quickly restore the supply demand balance in power systems the need for this tends to be increased by the use of variable renewable energy sources vre such as wind and solar power this paper reviews three channels through which vre and balancing systems interact the impact of vre forecast errors on balancing reserve requirements the supply of balancing services by vre generators and the incentives to improve forecasting provided by imbalance charges the paper reviews the literature provides stylized facts from german market data and suggests policy options surprisingly while german wind and solar capacity has tripled since 2008 balancing reserves have been reduced by 15 and costs by 50

quantitative easing auctions of treasury bonds abstract the federal reserve uses reverse auctions to implement its purchases of treasury bonds in quantitative easing qe to evaluate dealers offers across multiple bonds the fed relies on its internal yield curve model fitted to secondary market bond prices from november 2010 to september 2011 a one standard deviation increase in the cheapness of a treasury bond how much the market price of the bond is below a model implied value increases the fed s purchase quantity of that bond by 276 million and increases the auction costs on that bond by 2 6 cents per 100 par value controlling for standard covariates our results suggest that the fed harvests gains from trades by purchasing undervalued bonds but strategic dealers extract some profits because the fed s relative values can be partly inferred from price data

revisiting the techno economic analysis process for building mounted grid connected solar photovoltaic systems part two application part one in this two part paper identified monte carlo analysis as an improved approach over traditional deterministic techno economic methods for solar pv prosumers in deregulated markets in this

managing volumetric risk of long term power purchase agreements abstract a negative dependence between wind power production and electricity spot price exists this is an important fact to consider for risk management of long term power purchase agreements ppas in this study we investigate this dependence by constructing a joint model using constant as well as time varying copulas we propose to use score driven models as marginal model for the spot price of electricity as these are more robust to extreme events compared to arma garch models we apply the new model to pricing and risk management of ppas and benchmark it against the arma garch specification our comparison shows that the score driven model results in a statistically significant improvement of predicting the value at risk var which is of high importance for risk management of long term ppas further comparing constant and time varying copulas we find that all time varying copulas are significantly better than their constant counterparts at predicting the var hence time varying copulas should be used in risk management of ppas

the uniform price auction with endogenous supply abstract this paper shows that low price equilibria in the uniform price auction with endogenous supply do not exist if the seller employs the proportional rationing rule and is consistent when selecting among profit maximizing quantities in a consistent subgame perfect equilibrium the walrasian quantities are traded at the walrasian price

the impact of wind power support schemes on technology choices abstract in energy systems with large shares of variable renewable energies electricity generation is lower during unfavorable weather conditions system friendly wind turbines sfts rectify this by producing a larger share of their electricity at low wind speeds this paper analyzes to what extent sfts benefits out weigh their additional costs and how to incentivize investments into them using a wind power investment model for germany i show that sfts indeed deliver benefits for the energy system that over compensate for their cost premium floating market premium schemes incentivize their deployment only where investors bear significant price risks and possess sufficient foresight alternatively a new production value based benchmark triggers investors to install sfts that meet the requirements of power systems with increasing shares of variable renewable energies

intrapreneurship construct refinement and cross cultural validation abstract intrapreneurship entrepreneurship within existing organizations has been of interest to scholars and practitioners for the past two decades intrapreneurship is viewed as being beneficial for revitalization and performance of corporations as well as for small and medium sized enterprises the concept has four distinct dimensions first the new business venturing dimension refers to pursuing and entering new businesses related to the firm s current products or markets second the innovativeness dimension refers to the creation of new products services and technologies third the self renewal dimension emphasizes the strategy reformulation reorganization and organizational change finally the proactiveness dimension reflects top management orientation in pursuing enhanced competitiveness and includes initiative and risk taking and competitive aggressiveness and boldness while differing somewhat in their emphasis activities and orientations the four dimensions pertain to the same concept of intrapreneurship because they are factors of schumpeterian innovation the building block of entrepreneurship the pursuit of creative or new solutions to challenges confronting the firm including the development or enhancement of old and new products and services markets administrative techniques and technologies for performing organizational functions e g production marketing sales and distribution as well as changes in strategy organizing and dealings with competitors are innovations in the broadest sense intrapreneurship theory and measures have an american basis while being considered universal their generalizability has been limited because their cross cultural testing has been extremely limited two main measures of intrapreneurship the entrescale and the corporate entrepreneurship scale were developed independently but lack validity for cross national comparisons and do not tap all four dimensions of intrapreneurship when used independently in order to fill the gaps in previous research these two scales are integrated into a four dimensional measure of intrapreneurship refinement and validation was done by using two samples from two distinct economies slovenia a small transition economy from central and eastern europe with a short entrepreneurship tradition and the united states a large developed and advanced economy that is a leader in entrepreneurship research and practice the refined multidimensional measure of intrapreneurship was developed to be cross culturally generalizable because its refined dimensions scales include only cross culturally comparable items the refined intrapreneurship construct measure showed reasonably good convergent and discriminant validity as well as good nomological validity in terms of expected positive relationships to its antecedents organizational and environmental characteristics and consequences growth and profitability across the two samples that included large medium sized and smaller firms from a variety of different industries manufacturing consumer and industrial goods consumer and business services trade and construction in addition to the generalizability of the refined intrapreneurship construct measure the results of this study support the notion that intrapreneurship is an important predictor of firm growth in terms of absolute growth growth in number of employees and in total sales and relative growth growth in market share in comparison to competition firms that nurture organizational structures and values conducive to intrapreneurial activities are more likely to grow than organizations that are low in such characteristics open and quality communication existence of formal controls intensive environmental scanning management support organizational support and values all help an organization become more intrapreneurial intrapreneurial organizations are those that engage in new business venturing are innovative continuously renew themselves and are proactive in transition economies which are adapting their economies to more developed economies standards of doing business and where growth may not yet be the primary goal intrapreneurship may be even more important for the growth and profitability of existing organizations

discriminatory versus uniform treasury auctions evidence from when issued transactions abstract we use when issued transactions data to assess the treasury s current experiment with uniform auctions when issued volume is higher under uniform as compared to discriminatory auctions suggesting a higher information release which should reduce pre auction uncertainty and the winner s curse under uniform auctions when issued volatility falls after the auction and again after the outcome announcement the pattern is the opposite for discriminatory auctions this is further evidence that uniform auctions increase pre auction information and lower the short squeeze a direct comparison of markups in uniform and discriminatory auctions yields mixed results

limits to growth in the renewable energy sector abstract it has been well documented that population growth development of biological subsystems and the utilization of resources in ecology and economy frequently follow a logistic or sigmoid time development in the context of oil and gas extraction such development is known as hubbert s peak oil theory we observe that the logistic equation describes the historic development of nuclear and hydroelectric energy production as well previous studies have hypothesized that the present time fastest growing renewable technologies wind and solar energy will develop under similar constraints here we provide evidence that the installation of these technologies follow a logistic curve in contrast to what is commonly perceived the specific growth rate in energy extraction from wind turbines and photovoltaics have decreased in recent years in an optimistic scenario where we have included forecasted data from the solar and wind associations four years into the future the logistic model implies that the total installed capacity saturates at around 1 8 tw in 2030 this is in sharp contrast to the almost established belief that these energy technologies will experience an exponential growth far into this century

how market design shapes the spatial distribution of power plant curtailment costs abstract when multiple power plants are curtailed at the same time and in the same region electricity system costs rise if transmission lines are congested these costs might be amplified and spatially more concentrated because there are less spatial spill overs we study how such costs and their distribution depend on the market design nodal pricing or uniform pricing we extend the literature on curtailment by considering space and market design and the literature on market design by considering curtailment we expose a dc load flow model for germany to severe correlated curtailment scenarios we find that additional costs are moderate for the simulated week curtailment of 9 3 non renewable capacity reduces welfare by 2 7 uniform pricing with nodal pricing welfare loss can be reduced by 1 5 distributional differences are multiple times larger for nodal pricing producer surplus rises more and costs are spatially more concentrated at the curtailed power plants consumer surplus becomes lower the difference is unlikely to justify changes of the current market design if also wind or photovoltaic feed in is unavailable economic impacts can decrease or increase but remain in the same order of magnitude the spatial electricity system structure matters more than the volume of curtailment

comparing the costs of intermittent and dispatchable electricity generating technologies economic evaluations of alternative electric generating technologies typically rely on comparisons between their expected life cycle production costs per unit of electricity supplied the standard life cycle cost metric utilized is the levelized cost per mwh supplied this paper demonstrates that this metric is inappropriate for comparing intermittent generating technologies like wind and solar with dispatchable generating technologies like nuclear gas combined cycle and coal levelized cost comparisons are a misleading metric for comparing intermittent and dispatchable generating technologies because they fail to take into account differences in the production profiles of intermittent and dispatchable generating technologies and the associated large variations in the market value of the electricity they supply levelized cost comparisons overvalue intermittent generating technologies compared to dispatchable base load generating technologies they also overvalue wind generating technologies compared to solar generating technologies integrating differences in production profiles the associated variations in the market value of the electricity supplied and life cycle costs associated with different generating technologies is necessary to provide meaningful comparisons between them this market based framework also has implications for the appropriate design of procurement auctions created to implement renewable energy procurement mandates the efficient structure of production tax credits for renewable energy and the evaluation of the additional costs of integrating intermittent generation into electric power networks

short term optimal wind power generation capacity in liberalized electricity markets mainly because of environmental concerns and fuel price uncertainties considerable amounts of wind based generation capacity are being added to some deregulated power systems the rapid wind development registered in some countries has essentially been driven by strong subsidizing programs since wind investments are commonly isolated from market signals installed wind capacity can be higher than optimal leading to distortions of the power prices with a consequent loss of social welfare in this work the influence of wind generation on power prices in the framework of a liberalized electricity market has been assessed by means of stochastic simulation techniques the developed methodology allows investigating the maximal wind capacity that would be profitably deployed if wind investments were subject to market conditions only for this purpose stochastic variables determining power prices are accurately modeled a test system resembling the size and characteristics of the german power system has been selected for this study the expected value of the optimal short term wind capacity is evaluated for a considerable number of random realizations of power prices the impact of dispersing the wind capacity over statistical independent wind sites has also been evaluated the simulation results reveal that fuel prices installation and financing costs of wind investments are very influential parameters on the maximal wind capacity that might be accommodated in a market based manner

residual load renewable surplus generation and storage requirements in germany abstract i examine the effects of increasing amounts of fluctuating renewable energy on residual load which is defined as the difference between actual power demand and the feed in of non dispatchable and inflexible generators i draw on policy relevant scenarios for germany and make use of extensive sensitivity analyses whereas yearly renewable surplus energy is low in most scenarios analyzed peak surplus power can become very high decreasing thermal must run requirements and increasing biomass flexibility substantially reduce surpluses i use an optimization model to determine the storage capacities required for taking up renewable surpluses allowing curtailment of 1 of the yearly feed in of non dispatchable renewables would render storage investments largely obsolete until 2032 under the assumption of a flexible power system further restrictions of curtailment as well as lower system flexibility strongly increase storage requirements by 2050 at least 10 gw of storage are required for surplus integration of which a sizeable share is seasonal storage results suggest that policy makers should work toward avoiding surplus generation in particular by decreasing the must run of thermal generators concerns about surpluses should not be regarded as an obstacle to further renewable expansion the findings are also relevant for other countries that shift toward fluctuating renewables

uniform vs discriminatory auctions with variable supply experimental evidence in the variable supply auction considered here the seller decides how many customers with unit demand to serve after observing their bids bidders are uncertain about the seller s cost we experimentally investigate whether a uniform or a discriminatory price auction is better for the seller in this setting exactly as predicted by theory it turns out that the uniform price auction produces substantially higher bids and consequently yields higher revenues and profits for the seller furthermore again as predicted by theory the uniform price auction yields a higher number of transactions which makes it also the more efficient auction format

spillover effects of distribution grid tariffs in the internal electricity market an argument for harmonization abstract in many countries distribution grid tariffs are being reformed to adapt to the new realities of an electricity system with distributed energy resources in europe legislative proposals have been made to harmonize these reforms across country borders many stakeholders have argued that distribution tariffs are a local affair while the european institutions argued that there can be spillovers to other countries which could justify a more harmonized approach in this paper we quantify these spillovers in a simplified numerical example to give insight and an order of magnitude we look at different scenarios and find that the spillovers can be both negative and positive to be able to quantify these effects we developed a long run market equilibrium model that captures the wholesale market effects of distribution grid tariffs the problem is formulated as a non cooperative game involving consumers generating companies and distribution system operators in a stylized electricity market

the second french nuclear bet following the first oil crisis france launched the world s largest ever nuclear energy program commissioning 58 new reactors these reactors are now reaching 40 years of age the end of their technological lifetime this places france at an energy policy crossroads should the reactors be retrofitted or should they be decommissioned the cost optimal decision depends on several factors going forward in particular the expected costs of nuclear energy production electricity demand levels and carbon prices all of which are subject to significant uncertainty to deal with these uncertainties we apply the robust decision making framework to determine which reactors should be retrofitted we build an investment and dispatch optimization model calibrated for france then we use it to study 27 retrofit strategies for all combinations of uncertain parameters with nearly 8000 runs our analysis indicates that robust strategies involve the early closure of 10 to 20 reactors while extending the life of all other reactors these strategies provide a hedge against the risks of unexpected increases in retrofit costs low demand and low carbon prices our work also highlights the vulnerabilities of the official french government scenarios and complements them by suggesting new robust strategies these results provide a timely contribution to the current debate on the lifetime extension of nuclear plants in france

electricity prices large scale renewable integration and policy implications abstract this paper investigates the effects of intermittent solar and wind power generation on electricity price formation in germany we use daily data from 2010 to 2015 a period with profound modifications in the german electricity market the most notable being the rapid integration of photovoltaic and wind power sources as well as the phasing out of nuclear energy in the context of a garch in mean model we show that both solar and wind power granger cause electricity prices that solar power generation reduces the volatility of electricity prices by scaling down the use of peak load power plants and that wind power generation increases the volatility of electricity prices by challenging electricity market flexibility

the impact of the north atlantic oscillation on electricity markets a case study on ireland abstract the north atlantic oscillation nao is a large scale atmospheric circulation pattern driving climate variability in north western europe as the deployment of wind powered generation expands on electricity networks across europe the impacts of the nao on the electricity system will be amplified this study assesses the impact of the nao via wind power generation on the electricity market considering thermal generation costs wholesale electricity prices and wind generation subsidies a monte carlo approach is used to model nao phases and generate hourly wind speed time series data electricity demand and fuel input data a least cost unit commitment and economic dispatch model is used to simulate an island electricity system modelled on the all island irish electricity system the impact of the nao obviously depends on the level of wind capacity within an electricity system our results indicate that on average a switch from negative to positive nao phase can reduce thermal generation costs by up to 8 reduce wholesale electricity prices by as much as 1 5 mwh and increase wind power generators revenue by 12

opening and closing the market evidence from the london stock exchange we investigate the performance of call markets at the open and close using a unique natural experiment provided by the london stock exchange where traders can choose between a call and an off exchange dealership system although the call market dominates dealers in terms of price discovery it suffers from a high failure rate to open and close trading especially when trading conditions are difficult the call s trading costs increase with asymmetric information slow trading order flow imbalances and uncertainty traders resort to use of call auctions is negatively correlated with firm size implying that the call may not be the optimal method for opening and closing trading of medium and small sized stocks

hedging winner s curse with multiple bids evidence from the portuguese treasury bill auction auctions of government securities typically permit bidders to enter multiple price quantity bids despite the widespread adoption of this institutional feature and its use by bidders the motivations behind its use and its effects on auction outcomes are not well understood theoretically and have been little explored empirically this paper proposes that bidders use multiple bids to adjust for winner s curse by spreading her bids a bidder aligns her outcome more closely to the aggregate outcome of the auction this hypothesis is tested using bidding data from treasury bill auctions in portugal i find that ceteris paribus a bidder submits a greater number of bids and disperses prices on these bids more widely when there is a greater potential for winner s curse in particular both these measures of bid spreading increase with the volatility of market interest rates and the expected number of participating well informed bidders

an efficient ascending bid auction for multiple objects when bidders exhibit multi unit demands standard auction methods generally yield inefficient outcomes this article proposes a new ascending bid auction for homogeneous goods such as treasury bills or telecommunications spectrum the auctioneer announces a price and bidders respond with quantities items are awarded at the current price whenever they are clinched and the price is incremented until the market clears with private values this dynamic auction yields the same outcome as the sealed bid vickrey auction but has advantages of simplicity and privacy preservation with interdependent values this auction may retain efficiency whereas the vickrey auction suffers from a generalized winner s curse

erratum to the uniform price auction with endogenous supply abstract this paper shows that low price equilibria in the uniform price auction with endogenous supply do not exist if the seller employs the proportional rationing rule and is consistent when selecting among profit maximizing quantities in a consistent subgame perfect equilibrium the walrasian quantities are traded at the walrasian price

impacts of a common green certificate market on electricity and co2 emission markets in the nordic countries abstract the purpose of this study is to analyze the effects of introducing a common nordic system for tradable green certificates tgcs on the electricity market and a future market for tradable co 2 emission permits teps in the analysis the energy system model generator markal was used to model the electricity and district heating supply systems in the four nordic countries sweden norway finland and denmark it is shown that the introduction of tgc quotas reduces wholesale electricity and tep prices the impact on the latter is very pronounced retail electricity prices may become lower or higher depending on the tgc quota than if obligations to fulfill tgc quotas were absent the tgc scheme s efficiency in reducing a specific amount of co 2 emissions is also compared to the corresponding efficiency of a tep scheme involving a broader range of technologies furthermore obligations to fulfill tgc quotas affect investment incentives for new non renewable electricity supply this seems especially true for gas fired power plants finally it is indicated that electricity supply based on biomass combustion dominates the tgc scheme at least in the short run

impact of electrical intertie capacity on carbon policy effectiveness this study investigates the potential cost and emissions reductions that result from an increase in electricity transmission capacity between canada s two westernmost provinces alberta a fossil fuel dominated jurisdiction and british columbia a predominantly hydroelectric jurisdiction a bottom up model is used to find the least cost electricity generation mix in alberta and british columbia under different carbon policies the long term evolution of the electricity system is determined by minimizing net present cost of electricity generation for the time span of 2010 2060 different levels of intertie capacity expansion are considered together with a variety of carbon tax and carbon cap scenarios results indicate that increased intertie capacity reduces the cost of electricity and emissions under carbon pricing policies however the expandable intertie does not encourage greater adoption of variable renewable generation instead it is used to move low cost energy from the united states to alberta the optimal intertie capacity and cost reduction of increased interconnectivity increases with more restrictive carbon policies

identifying barriers to large scale integration of variable renewable electricity into the electricity market a literature review of market design abstract for reaching the 2 c climate target the robust growth of electricity generation from variable renewable energy sources vre in the power sector is expected to continue accommodation of the power system to the variable uncertain and locational dependent outputs of vre causes integration costs integrating vre into a well functioning electricity market can minimize integration costs and drive investments in vre and complementary flexible resources however the electricity market in the european union eu as currently designed seems incapable to deliver this end this paper aims to provide a comprehensive literature review of barriers to the large scale market integration of vre in the eu electricity market design based on the set up of the eu electricity market a framework was developed to incorporate the most pertinent market integration barriers and resulting market inefficiencies this paper concludes that an overhaul is needed for the current eu electricity market to address all barriers identified firstly a discrete auction intraday market a marginal pricing balancing market a two price imbalance settlement and a nodal pricing locational marginal pricing mechanism seem more promising in limiting integration costs secondly to support business cases of vre and complementary flexible resources in the electricity market a level playing field should be established and the price cap should be lifted up to the value of lost load voll meanwhile to fit vre s market participation a higher time resolution of trading products and later gate closure time in different submarkets would be required lastly feed in support schemes currently widely used for vre investments might be inconsistent with market integration as they increase integration costs and lock vre investments in a subsidy dependent pathway to avoid such lock in further investigation of alternative capacity based support schemes is recommended

determining commercially viable two way and one way contract for difference strike prices and revenue receipts abstract in this article we investigate the role that a contract for difference cfd might play in increasing investment in renewable energy in australia two cfd schemes are investigated two way and one way cfd a financial model is developed that determines commercially viable cfd strike prices account is taken of revenue from wholesale electricity market and renewable energy certificate sales capital and operational costs of the project including distribution of funds to holders of equity and debt are also included findings based on analysis of the solar array located at the university of queensland gatton campus in australia is presented employing a typical meteorological year framework the major finding was that government will prefer a two way cfd scheme and single axis tracking solar pv array technology in contrast project proponents will strongly prefer a one way cfd design

demand pull instruments and the development of wind power in europe a counterfactual analysis renewable energy technologies are called to play a crucial role in the reduction of greenhouse gas emissions since most of these technologies did not yet reach grid parity public policies have been implemented in order to foster their deployment the approach that has been privileged in europe is the demand pull approach that aims at creating a demand for these new technologies and at stimulating their diffusion this paper examines the effect of demand pull policies on the diffusion of onshore wind power technology in six european countries denmark france germany italy portugal and spain in a first step a micro founded model of diffusion is calibrated in order to replicate the observed diffusion of wind power in these six countries in a second step a counterfactual analysis is conducted by investigating several scenarios by taking into account the complex self sustained dynamics of diffusion and the learning spillovers that operate in the wind power sector we can derive several insights about demand pull policies first the impact of a demand pull policy on the diffusion of wind power is determined by the stage at which it comes to support it the effect seems to be stronger at the beginning of the diffusion second international spillovers do operate in the wind power sector these international spillovers however are not strong enough to foster the diffusion of wind power in a country having no demand pull support we can derive from these two statements that a strategy consisting in not implementing any demand pull policy with the expectation that international spillovers will reduce the cost of wind power and foster the diffusion of the technology that then shall become competitive is not a good option for a country targeting a high share of wind power in its energy mix

renewable electricity generation in germany a meta analysis of mitigation scenarios german energy policy targets envision a share of electricity from renewable energy sources res e of at least 80 in 2050 how can the transformation of the german electricity sector be achieved and at what costs this paper addresses these questions by means of a meta analysis of 10 recent model based mitigation scenarios for germany it turns out that the scenarios exploit the three basic strategic options of increasing the share of res e domestic res e generation electricity demand reductions and res e imports to substantially different extents domestic res e generation increases in all scenarios particularly from onshore and offshore wind scenarios that rely heavily on reducing electricity demand require a relatively low expansion of domestic res e generation despite detailed technical analyses insights on the costs of the transformation remain limited a discussion of underlying scenario assumptions reveals that it is unclear whether i res e and system integration technology development will be as cost competitive as postulated ii implicitly assumed institutional requirements will be realized and iii relevant actors in the transformation process will be incentivized accordingly therefore future research should pursue a thorough assessment of strategic options for transforming the german electricity system that consistently integrates technologies institutions and actors

the effect of wind and solar power generation on wholesale electricity prices in australia abstract our paper investigates the effect of wind and utility scale solar electricity generation on wholesale electricity prices in australia over 2010 2018 we use both high frequency 30 min and daily datasets for the australian national electricity market nem we estimate autoregressive distributed lag models ardl to decompose the merit order effect of wind and utility scale solar pv generation over time and across states we find that an extra gw of dispatched wind capacity decreases the wholesale electricity price by 11 aud mwh at the time of generation while solar capacity by 14 aud mwh the daily merit order effect is lower we show that the wind merit order effect has been increasing as a function of dispatched wind capacity over time despite of this wholesale electricity prices in australia have been increasing predominantly driven by the increase in natural gas prices our findings further strengthen the evidence of the merit order effect of renewable energy sources with important implications for the current energy policy debate in australia

system friendly wind power how advanced wind turbine design can increase the economic value of electricity generated through wind power abstract previous studies find that the economic value of electricity usd mwh generated by wind power drops with increasing market share different measures can help mitigate the value drop including electricity storage flexible conventional plants expansion of transmission and demand response this study assesses another option a change in design of wind power plants advanced wind turbines that are higher and have a larger rotor compared to rated capacity lower specific rating generate electricity more constantly than classical turbines recent years have witnessed a significant shift towards such advanced technology our model based analysis for northwestern europe shows that such design can substantially increase the spot market value of generated electricity at a 30 penetration rate the value of 1 mwh of electricity generated from a fleet of advanced turbines is estimated to be 15 higher than the value of 1 mwh from classical turbines the additional value is large whether compared to wind generation costs to the value drop or to the effect of alternative measures such as electricity storage extensive sensitivity tests indicate that this finding is remarkably robust the increase in bulk power value is not the only advantage of advanced turbines additional benefits might accrue from reduced costs for power grids and balancing services to fully realize this potential power markets and support policies need to be appropriately designed and signal scarcity investors