IDEAS home Printed from https://ideas.repec.org/a/cai/reofsp/reof_124_0415.html
   My bibliography  Save this article

High wind Penetration in an Agent-Based Model of the Electricity Market. The Case of Italy

Author

Listed:
  • Eric Guerci
  • Alessandro Sapio

Abstract

In this paper, we build a realistic large-scale agent-based model of the Italian electricity market and run simulations to investigate how a significant increase in wind capacity can affect electricity prices at the national level when the wind resource is geographically concentrated, as in the case of Italy. The simulator implements both cost-based and oligopoly models in which electricity companies learn to bid strategically. We compare a scenario based on the 2010 wind supply and a scenario based on the maximum potential wind capacity as estimated in technical reports. Results confirm the beneficial effect of low-cost renewable energy in reducing average market prices, but simulated power flows in the grid suggest that congestion in the electricity network induced by high wind penetration creates market power opportunities that can offset the price reduction effects.

Suggested Citation

  • Eric Guerci & Alessandro Sapio, 2012. "High wind Penetration in an Agent-Based Model of the Electricity Market. The Case of Italy," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(5), pages 415-447.
    • Handle: RePEc:cai:reofsp:reof_124_0415
    as

    Download full text from publisher

    File URL: http://www.cairn.info/load_pdf.php?ID_ARTICLE=REOF_124_0415
    Download Restriction: free
    File URL: http://www.cairn.info/revue-de-l-ofce-2012-5-page-415.htm
    Download Restriction: free
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. De Siano, Rita & Sapio, Alessandro, 2022. "Spatial merit order effects of renewables in the Italian power exchange," Energy Economics, Elsevier, vol. 108(C).
    2. Balint, T. & Lamperti, F. & Mandel, A. & Napoletano, M. & Roventini, A. & Sapio, A., 2017. "Complexity and the Economics of Climate Change: A Survey and a Look Forward," Ecological Economics, Elsevier, vol. 138(C), pages 252-265.
    3. Jean-Luc Gaffard & Mauro Napoletano, 2012. "Improving the toolbox. New advances in Agent-based and Computational Models," Revue de l'OFCE, Presses de Sciences-Po, vol. 0(5), pages 7-13.
    4. repec:hal:spmain:info:hdl:2441/5qr7f0k4sk8rbq4do5u6v70rm0 is not listed on IDEAS
    5. Sapio, Alessandro & Spagnolo, Nicola, 2020. "The effect of a new power cable on energy prices volatility spillovers," Energy Policy, Elsevier, vol. 144(C).
    6. Sapio, Alessandro, 2019. "Greener, more integrated, and less volatile? A quantile regression analysis of Italian wholesale electricity prices," Energy Policy, Elsevier, vol. 126(C), pages 452-469.
    7. Jean-Luc Gaffard & Mauro Napoletano, 2012. "Introduction - Improving the Toolbox: New Advances in Agent-Based and Computational Models," Post-Print hal-01053562, HAL.
    8. repec:hal:spmain:info:hdl:2441/1nlv566svi86iqtetenms15tc4 is not listed on IDEAS
    9. repec:hal:spmain:info:hdl:2441/53r60a8s3kup1vc9l564k4686 is not listed on IDEAS
    10. Sirin, Selahattin Murat & Yilmaz, Berna N., 2020. "Variable renewable energy technologies in the Turkish electricity market: Quantile regression analysis of the merit-order effect," Energy Policy, Elsevier, vol. 144(C).
    11. Sapio, Alessandro & Spagnolo, Nicola, 2016. "Price regimes in an energy island: Tacit collusion vs. cost and network explanations," Energy Economics, Elsevier, vol. 55(C), pages 157-172.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:cai:reofsp:reof_124_0415. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Jean-Baptiste de Vathaire (email available below). General contact details of provider: https://www.cairn.info/revue-de-l-ofce.htm .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.