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The effects of power system flexibility on the efficient transition to renewable generation

Paul Neetzow

Applied Energy, 2021, vol. 283, issue C, No S0306261920316664

Abstract: During the necessary transition to sustainable power systems, fossil generators are used to complement generation from renewable energies. Yet not all fossil technologies can be operated flexibly enough to balance the fluctuating output of renewables. I study how the efficient transition to renewables is influenced by the endowment with flexible and inflexible generators. To this end, I develop a parsimonious analytical model that incorporates a variable renewable energy (VRE) technology with stochastic generation availability as well as flexible and inflexible fossil generators with rigid capacities. I find that early in the transition, VRE generation replaces generation from flexible capacities. Only later is the output of inflexible generation reduced and substituted by increasing flexible and renewable generation. The early deployment of VRE is hampered by high inflexible capacities. However, deployment speed surges once VRE generation begins to substitute inflexible generation. The more excess capacities exist in the initial endowment, the higher the sudden increase in deployment is. The decreasing use of inflexible fossil generation is usually accompanied by an increasing utilization of flexible generators. Nevertheless, constructing additional flexible capacities is only cost-efficient if a cost threshold is not exceeded. By contributing to a better understanding of the impact of flexibility on efficient VRE deployment, this work aims to facilitate an efficient transition to renewable energies.

Keywords: Energy transition; Renewable energy; Flexibility; Rigid capacity endowment (search for similar items in EconPapers)
JEL-codes: C61 L94 Q41 Q42 (search for similar items in EconPapers)
Date: 2021
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DOI: 10.1016/j.apenergy.2020.116278

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