 Renewable generation and electricity prices: Taking stock and new evidence for Germany and AustriaKlaas Würzburg, Xavier Labandeira () and Pedro Linares () Energy Economics, 2013, vol. 40, issue S1, S159-S171 Abstract: Economic theory predicts that the increase of renewable electricity production should reduce the price of electricity in the short-run, which is also known as the ‘merit-order effect’. Although the merit-order effect is only one of several consequences of renewable production on the electricity system, it is crucial to determine its size for the economic evaluation of renewable energies. In this paper we present a comprehensive overview of relevant past research results on the price effect of renewables. Additionally, we conduct a new empirical analysis of the price effect of renewable production for the Austrian–German region, a market that clearly qualifies for a merit-order effect analysis given its characteristics. Based on the review and our own analysis, we show that the merit-order effect varies depending on the region and the assessment method chosen. We also find that the size of this effect is less dispersed throughout different markets than previously suggested by the literature. Keywords: Wind; Solar; Merit-order; Supply (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:40:y:2013:i:s1:p:s159-s171 DOI: 10.1016/j.eneco.2013.09.011 Access Statistics for this article Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant More articles in Energy Economics from Elsevier |
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