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Electricity Price and Demand Pattern Changes Due to Increases in Solar Generation in German Electricity Markets

Author

Listed:
  • Jan Smolen

    (Department of Economy and Finance, Faculty of Management, Comenuis University in Bratislava, Odbojarov 10, 820 05 Bratislava 25, Slovakia.)

  • Branislav Dudic

    (Department of Economy and Finance, Faculty of Management, Comenuis University in Bratislava, Odbojarov 10, 820 05 Bratislava 25, Slovakia.)

Abstract

This article aims to explain the impacts of increases in solar generation in Germany on intra-day electricity price and demand patterns during the last decade. Electricity demand sensitivity to the changes in price patterns is also analyzed. It is concluded that there is a clear relationship between the amount of solar generation and daily peak price premiums over the average daily price. With increased solar generation, peak hour electricity price premiums are gradually decreasing. This relation is even more visible during the summer months, with higher amount of solar power produced. However, demand response analysis to the changes in price patterns has provided less conclusive results. While, between years 2007 and 2013, demand clearly adjusted relatively higher, with relatively lower peak prices, more recent periods haven t fully confirmed this trend. Some theories explaining the possible reasons for this fact are also presented in the article.

Suggested Citation

  • Jan Smolen & Branislav Dudic, 2019. "Electricity Price and Demand Pattern Changes Due to Increases in Solar Generation in German Electricity Markets," International Journal of Energy Economics and Policy, Econjournals, vol. 9(1), pages 168-173.
    • Handle: RePEc:eco:journ2:2019-01-21
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    References listed on IDEAS

    as
    1. Nilgun Serim & Filiz Coban Oran, 2017. "The Renewable Energy Policy Convergence in the European Union: A Comparison on Germany and Turkey s Incentives for the Wind and Solar Energy Resources," International Journal of Energy Economics and Policy, Econjournals, vol. 7(3), pages 308-320.
    2. Paul J. Burke and Ashani Abayasekara, 2018. "The Price Elasticity of Electricity Demand in the United States: A Three-Dimensional Analysis," The Energy Journal, International Association for Energy Economics, vol. 0(Number 2).
    3. HFrance Krizanic & Zan Jan Oplotnik, 2013. "Market Changes, Business Cycles and Fluctuations in Electricity Prices - EU Evidence from Germany and Slovenia," International Journal of Energy Economics and Policy, Econjournals, vol. 3(2), pages 118-126.
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    Cited by:

    1. Sousa, Joana & Soares, Isabel, 2022. "Demand response potential: An economic analysis for MIBEL and EEX," Energy, Elsevier, vol. 244(PA).

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    More about this item

    Keywords

    Electricity Price; Renewable Generation; Demand Response;
    All these keywords.

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources

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