- Magnus Korpås
- WP3 Lead
Analytical market model for systems with renewables and storage
Challenge and objective
- Investments in renewables have been driven, in part, by incentive schemes and policies.
- Rapid reduction in costs for renewables and storage.
- How does these technologies influence prices and investments in competitive markets?
- Investigate how renewable energy and electric energy storage impacts the formation of prices and optimal investments in energy-only markets.
- Develop an analytical approach to derive the system-optimal conditions for installed capacity of all generators and storage devices.
- All energy technologies recover their costs and maximize their profits in the system optimum, for an ideal short-term electricity market based on marginal cost and scarcity pricing subsidy schemes.
- Storage triggers more investments in renewables, replaces fossil energy and reduces CO2-emissions.
- Analytic results for how renewables and storage impact the short-term price formation under equilibrium conditions.
Impact for distribution system innovation
- Foundation for local market designs.
- Understanding competition in systems with storage and flexibility.
- Inputs to optimal design of microgrids in a competitive setting.
Reference in CINELDI
- M. Korpås, A. Botterud: "Optimality Conditions and Cost Recovery in Electricity Markets with Variable Renewable Energy and Energy Storage", MIT-CEEPR Working Paper 2020-005.