Limiting imbalance settlement costs from variable renewable energy sources in the Nordics: Internal balancing vs. balancing market participation

Øyvind Sommer Klyve, Gro Klæboe, Magnus Moe Nygård and Erik Stensrud Marstein

Applied Energy, 2023, vol. 350, issue C, No S0306261923010607

Abstract: Due to the market gate closures in the Nordic energy markets, producers with variable renewable energy (VRE) assets, e.g., PV and wind power plants, must forecast their production prior to delivery, leaving room for significant forecast errors. These forecast errors can lead to imbalances between the contractual market agreements and physical delivery, which have to be financially accounted for through the imbalance settlement. The increasing shares of VREs in the Nordic energy mix and the increasing variability in the price of regulating the imbalances, can lead to potential large revenue losses for the producers.

Keywords: Variable renewable energies; Imbalance settlement; Forecast errors; Nordic energy markets (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0306261923010607
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:appene:v:350:y:2023:i:c:s0306261923010607

Ordering information: This journal article can be ordered from
http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/bibliographic
http://www.elsevier. ... 405891/bibliographic

DOI: 10.1016/j.apenergy.2023.121696

Access Statistics for this article

Applied Energy is currently edited by J. Yan

More articles in Applied Energy from Elsevier
Bibliographic data for series maintained by Catherine Liu ().