Wind power feed-in impact on electricity prices in Germany 2009-2013

François Benhmad and Jacques Percebois

European Journal of Comparative Economics, 2016, vol. 13, issue 1, 81-96

Abstract: Until quite recently no electricity system had faced the challenges associated with high penetrations of renewable energy sources (RES). In this paper, we carry out an empirical analysis for Germany, as a country with high penetration of wind energy, to investigate the well-known merit-order effect. Our main empirical findings suggest that the increasing share of wind power in-feed induces a decrease of electricity spot price level but an increase of spot prices volatility. Furthermore, the relationship between wind power and spot electricity prices can be strongly impacted by European electricity grids interconnection which behaves like a safety valve lowering volatility and limiting the price decrease. Therefore, the impacts of wind generated electricity on electricity spot markets are less clearly pronounced in interconnected systems

Keywords: RES; Electricity spot prices; merit order effect; volatility (search for similar items in EconPapers)
JEL-codes: Q41 Q42 Q48 (search for similar items in EconPapers)
Date: 2016
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Citations: View citations in EconPapers (7)

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Persistent link: https://EconPapers.repec.org/RePEc:liu:liucej:v:13:y:2016:i:1:p:81-96

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