How to Sell Renewable Electricity - Interactions of the Intraday and Day-ahead Market under Uncertainty
Andreas Knaut () and
Frank Obermüller ()
No 2016-4, EWI Working Papers from Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI)
Uncertainty about renewable production increases the importance of sequential short-term trading. We consider a two-stage market where conventional and renewable producers compete in order to satisfy the demand of consumers. The trading in the ﬁrst stage takes place under uncertainty about production levels of renewable producers, which can be associated with trading in the day-ahead market. In the second stage, which we consider as the intraday market, uncertainty about the production levels is resolved. Our model is able to capture diﬀerent levels of ﬂexibility for conventional producers as well as diﬀerent levels of competition for renewable producers. We ﬁnd that it is optimal for renewable producers to sell less than the expected production in the day-ahead market. In situations with high renewable production it is even proﬁtable for renewable producers to withhold quantities in the intraday market. However, for an increasing number of renewable producers, the optimal quantity tends towards the expected production level. More competition as well as a more ﬂexible power plant ﬂeet lead to an increase in overall welfare, which can even be further increased by delaying the gate-closure of the day-ahead market or by improving the quality of renewable production forecasts.
Keywords: Cournot Competition; electricity markets; day-ahead market; intraday market; competition under uncertainty (search for similar items in EconPapers)
JEL-codes: D81 L13 L94 Q21 (search for similar items in EconPapers)
Pages: 24 pages
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (9) Track citations by RSS feed
Downloads: (external link)
https://www.ewi.uni-koeln.de/cms/wp-content/upload ... able_Electricity.pdf Full text (application/pdf)
This item may be available elsewhere in EconPapers: Search for items with the same title.
Export reference: BibTeX
RIS (EndNote, ProCite, RefMan)
Persistent link: https://EconPapers.repec.org/RePEc:ris:ewikln:2016_004
Access Statistics for this paper
More papers in EWI Working Papers from Energiewirtschaftliches Institut an der Universitaet zu Koeln (EWI) Contact information at EDIRC.
Bibliographic data for series maintained by Sabine Williams ().