Marginal curtailment of wind and solar PV: transmission constraints, pricing and access regimes for efficient investment

David Newbery and Darryl Biggar

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: As Variable Renewable Energy (VRE) penetration increases in poorly networked areas with suitable VRE resources, transmission constraints will increasingly force VRE curtailment. Under most European market access and pricing arrangements, location and operation decisions are based on average curtailment rates. As the marginal contribution of the last MW of VRE is 3+ times average curtailment, there is a risk of inefficient location and operation. This article compares different pricing and access regimes (including nodal pricing that gives efficient transmission scarcity signals) to compare their impact on the incentives for VRE merchant or market driven entry.

Keywords: Transmission constraints; access regimes; variable renewable electricity; marginal curtailment; nodal pricing (search for similar items in EconPapers)
JEL-codes: H23 L94 Q28 Q42 Q48 (search for similar items in EconPapers)
Date: 2024-02-09
New Economics Papers: this item is included in nep-ene and nep-env
Note: dmgn
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (4)

Downloads: (external link)
https://www.econ.cam.ac.uk/sites/default/files/pub ... pe-pdfs/cwpe2405.pdf

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:cam:camdae:2405

Access Statistics for this paper

More papers in Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge
Bibliographic data for series maintained by Jake Dyer ().