The Experts below are selected from a list of 177024 Experts worldwide ranked by ideXlab platform
Simon Gill - One of the best experts on this subject based on the ideXlab platform.
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electricity security in the european union the conflict between national Capacity Mechanisms and the single market
Energy research and social science, 2017Co-Authors: Graeme Hawker, Keith Bell, Simon GillAbstract:Abstract The European Internal Energy Market aims to promote trade and competition in electricity generation across the EU, with investment signals for new generation Capacity and interconnection coming from zonal electricity prices reflecting scarcity value. However, a growing number of EU Member States have implemented national Capacity Mechanisms in order to ensure future security of supply within their own borders, which may distort the cross-border trade of energy. This local view of energy security is in response to internal technical and economic constraints and a perceived inability of cross-border electricity flows to be a reliable source of Capacity at times of maximum stress, in favour of self-sufficiency. A number of routes are available to resolve this conflict through permitting cross-border participation of generators in local Capacity Mechanisms, but this requires resolution of a number of complicating factors, not least a means for properly allocating transmission Capacity without introducing further distortions to the energy market. Alternative solutions could be enacted at an EU-level, such as through the alignment of Capacity Mechanisms to a common model, or the introduction of an EU-wide single Capacity Mechanism, but the current regulatory focus appears to remain on resolution of such issues at a national level.
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electricity security in the european union the conflict between national Capacity Mechanisms and the single market
Energy research and social science, 2017Co-Authors: Graeme Hawker, Keith Bell, Simon GillAbstract:Abstract The European Internal Energy Market aims to promote trade and competition in electricity generation across the EU, with investment signals for new generation Capacity and interconnection coming from zonal electricity prices reflecting scarcity value. However, a growing number of EU Member States have implemented national Capacity Mechanisms in order to ensure future security of supply within their own borders, which may distort the cross-border trade of energy. This local view of energy security is in response to internal technical and economic constraints and a perceived inability of cross-border electricity flows to be a reliable source of Capacity at times of maximum stress, in favour of self-sufficiency. A number of routes are available to resolve this conflict through permitting cross-border participation of generators in local Capacity Mechanisms, but this requires resolution of a number of complicating factors, not least a means for properly allocating transmission Capacity without introducing further distortions to the energy market. Alternative solutions could be enacted at an EU-level, such as through the alignment of Capacity Mechanisms to a common model, or the introduction of an EU-wide single Capacity Mechanism, but the current regulatory focus appears to remain on resolution of such issues at a national level.
Tanguy Janssen - One of the best experts on this subject based on the ideXlab platform.
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Capacity adequacy in power markets facing energy transition a comparison of scarcity pricing and Capacity Mechanism
Energy Policy, 2017Co-Authors: Marie Petitet, Dominique Finon, Tanguy JanssenAbstract:This article analyses how a Capacity Mechanism can address security of supply objectives in a power market undergoing an energy transition that combines energy efficiency efforts to stabilise demand and a rapid increase in the proportion of renewables. To analyse this situation, power markets are simulated over the long term with a System Dynamics model integrating new investment and closure decisions. This last trait is relevant to studying investment in power generation in mature markets undergoing policy shocks. The energy-only market design with a price cap, with and without a Capacity Mechanism, is compared to scarcity pricing in two investment behaviour scenarios with and without risk aversion. The results show that the three market designs lead to different levels of risk for peaking unit investment and results thus differ according to which risk aversion hypothesis is adopted. Assuming a risk-neutral investor, the results indicate that compared to an energy-only market with a price cap at 3 000 €/MWh, an energy-only market with scarcity pricing and the market design with a Capacity Mechanism are two efficient options to reach similar levels of load loss. But under the hypothesis of risk aversion, the results highlight the advantage of the Capacity Mechanism over scarcity pricing.
Graeme Hawker - One of the best experts on this subject based on the ideXlab platform.
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electricity security in the european union the conflict between national Capacity Mechanisms and the single market
Energy research and social science, 2017Co-Authors: Graeme Hawker, Keith Bell, Simon GillAbstract:Abstract The European Internal Energy Market aims to promote trade and competition in electricity generation across the EU, with investment signals for new generation Capacity and interconnection coming from zonal electricity prices reflecting scarcity value. However, a growing number of EU Member States have implemented national Capacity Mechanisms in order to ensure future security of supply within their own borders, which may distort the cross-border trade of energy. This local view of energy security is in response to internal technical and economic constraints and a perceived inability of cross-border electricity flows to be a reliable source of Capacity at times of maximum stress, in favour of self-sufficiency. A number of routes are available to resolve this conflict through permitting cross-border participation of generators in local Capacity Mechanisms, but this requires resolution of a number of complicating factors, not least a means for properly allocating transmission Capacity without introducing further distortions to the energy market. Alternative solutions could be enacted at an EU-level, such as through the alignment of Capacity Mechanisms to a common model, or the introduction of an EU-wide single Capacity Mechanism, but the current regulatory focus appears to remain on resolution of such issues at a national level.
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electricity security in the european union the conflict between national Capacity Mechanisms and the single market
Energy research and social science, 2017Co-Authors: Graeme Hawker, Keith Bell, Simon GillAbstract:Abstract The European Internal Energy Market aims to promote trade and competition in electricity generation across the EU, with investment signals for new generation Capacity and interconnection coming from zonal electricity prices reflecting scarcity value. However, a growing number of EU Member States have implemented national Capacity Mechanisms in order to ensure future security of supply within their own borders, which may distort the cross-border trade of energy. This local view of energy security is in response to internal technical and economic constraints and a perceived inability of cross-border electricity flows to be a reliable source of Capacity at times of maximum stress, in favour of self-sufficiency. A number of routes are available to resolve this conflict through permitting cross-border participation of generators in local Capacity Mechanisms, but this requires resolution of a number of complicating factors, not least a means for properly allocating transmission Capacity without introducing further distortions to the energy market. Alternative solutions could be enacted at an EU-level, such as through the alignment of Capacity Mechanisms to a common model, or the introduction of an EU-wide single Capacity Mechanism, but the current regulatory focus appears to remain on resolution of such issues at a national level.
Isaac Dyner - One of the best experts on this subject based on the ideXlab platform.
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Assessing security of supply in a largely hydroelectricity-based system: The Colombian case
Energy, 2018Co-Authors: Sebastian Zapata, Monica Castaneda, Estefany Garces, Carlos Jaime Franco, Isaac DynerAbstract:Abstract One of the primary challenges of the power industry, worldwide, is making the Capacity investment appropriate for the achievement of security of supply. This challenge is becoming even more relevant as power generation is increasingly based on renewables that are intermittent and seasonally dependent. In this context, policy makers and regulators implement Capacity Mechanisms that seek to overcome the intrinsic shortcomings of renewables. Failing to do so, given the uncertainty and complexity involved, means either that excessive overCapacity will become persistent and remain idle, or that under-Capacity will prompt blackouts and high electricity prices. To help manage the uncertainty and complexity, this paper contributes to a better understanding of the effects of the Capacity Mechanism on electricity markets with a high share of hydropower – by using a system dynamics modelling approach applied to Colombia. In the past, though the Capacity Mechanism induced large reserve margins, the system has been at serious risk of experience blackouts and has resulted in extremely high electricity prices over a prolonged period. In the future, worse scenarios are possible: historically-familiar events – when backup plants were not available – may recur when new Capacity is delayed, posing an even greater threat to the system.
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simulating the new british electricity market reform
European Journal of Operational Research, 2015Co-Authors: Carlos Jaime Franco, Monica Castaneda, Isaac DynerAbstract:Abstract The British government is implementing fully its novel Electricity Market Reform (GB EMR). Its objective, in line with European directives, aims at replacing existing nuclear and coal plant with low-carbon systems, to deliver reliable and affordable power. Though the GB EMR has proposed several policy instruments for meeting its objectives, and the academic literature has discussed the main issues, no known report includes a comprehensive and dynamic simulation exercise that assesses the extent of this profound and important initiative. This paper presents a system dynamics model that supports analysis of long-term effects of the various policy instruments that have been proposed in the GB EMR, focusing on environmental quality, security of supply and economic sustainability. Using lessons learned from simulation, the paper concludes that effectively achieving the GB EMR objectives requires this comprehensive intervention or a similar one that includes the promotion of low carbon electricity generation through the simultaneous implementation of various direct and indirect incentives, such as a carbon price floor, a Feed in Tariff (FIT) and a Capacity Mechanism.
Dominique Finon - One of the best experts on this subject based on the ideXlab platform.
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Capacity adequacy in power markets facing energy transition a comparison of scarcity pricing and Capacity Mechanism
Energy Policy, 2017Co-Authors: Marie Petitet, Dominique Finon, Tanguy JanssenAbstract:This article analyses how a Capacity Mechanism can address security of supply objectives in a power market undergoing an energy transition that combines energy efficiency efforts to stabilise demand and a rapid increase in the proportion of renewables. To analyse this situation, power markets are simulated over the long term with a System Dynamics model integrating new investment and closure decisions. This last trait is relevant to studying investment in power generation in mature markets undergoing policy shocks. The energy-only market design with a price cap, with and without a Capacity Mechanism, is compared to scarcity pricing in two investment behaviour scenarios with and without risk aversion. The results show that the three market designs lead to different levels of risk for peaking unit investment and results thus differ according to which risk aversion hypothesis is adopted. Assuming a risk-neutral investor, the results indicate that compared to an energy-only market with a price cap at 3 000 €/MWh, an energy-only market with scarcity pricing and the market design with a Capacity Mechanism are two efficient options to reach similar levels of load loss. But under the hypothesis of risk aversion, the results highlight the advantage of the Capacity Mechanism over scarcity pricing.
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The social Efficiency of long-term Capacity reserve Mechanisms
Utilities Policy, 2008Co-Authors: Dominique Finon, Guy Meunier, Virginie PignonAbstract:In Public Economics, the simple supply Mechanism for a collective good is the centralised provision by government, and paid by all beneficiaries through a small and targeted tax. In the case of Capacity adequacy in power supply, which could be considered as a collective good, two solutions of supply by government can be envisaged: a long-term Capacity reserve contracting by the system operator (SO), and a direct installation of peaking units by the SO. However, the centralised and direct Mechanisms are criticised, because of its potential to distort incentives to invest in peaking units and hence the natural functioning of energy markets. This paper analyses the different characters of a simple Capacity Mechanism and the safeguards used to limit its potential distortion effects. We discuss its deterrent effects on investment in peaking units. We also demonstrate its advantage in the context of hydro or mixed electricity systems exposed to the risk of exceptionally dry years.
