Review and Assessment of Decarbonized Future Electricity Markets

Ali Darudi () and Hannes Weigt
Additional contact information
Ali Darudi: Center for Energy and Environment, ZHAW School of Management and Law, 8401 Winterthur, Switzerland

Energies, 2024, vol. 17, issue 18, 1-38

Abstract: The electricity sector plays a key role in achieving zero emissions targets. The required transition will lead to substantial changes in the supply, demand, and distribution of electricity, as well as in stakeholder roles. Future market designs may change substantially to accommodate these changes, address challenges, and take advantage of new opportunities. This paper reviews the characteristics of future carbon-neutral electricity systems and electricity market design options. To provide a guiding framework for the literature review, we transfer the complexity of electricity systems into a three-layer structure: Firstly, we analyze papers that rely on techno-economic modeling of the physical electricity system. As a case study, we analyze various studies focusing on a decarbonized European electricity system in 2050. Secondly, we review papers that investigate the economic behavior and effects of self-interest-seeking stakeholders such as producers, network operators, and consumers. Finally, we review papers focusing on policy and market design questions that guide policymakers in achieving a target physical asset combination while considering the behavior of stakeholders. We highlight common trends and disagreements in the literature, review the main drivers of future markets, and finally provide a mapping between those drivers, challenges, and opportunities. The review concludes that the most promising next step toward a fully comprehensive assessment approach is to combine existing approaches across topical and disciplinary boundaries.

Keywords: renewable energy; electricity market; investment; renewable support (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2024
References: View references in EconPapers View complete reference list from CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/1996-1073/17/18/4752/pdf (application/pdf)
https://www.mdpi.com/1996-1073/17/18/4752/ (text/html)

Related works:
Working Paper: Review and Assessment of Decarbonized Future Electricity Markets (2024)
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:gam:jeners:v:17:y:2024:i:18:p:4752-:d:1483809

Access Statistics for this article

Energies is currently edited by Ms. Agatha Cao

More articles in Energies from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().