IDEAS home Printed from https://ideas.repec.org/a/spr/snopef/v4y2023i2d10.1007_s43069-023-00203-w.html
   My bibliography  Save this article

Learning by Doing: Insights from Power Market Modelling in Energy Economics Courses

Author

Listed:
  • Hannes Hobbie

    (TU Dresden, Faculty of Business & Economics, Chair of Energy Economics)

  • Constantin Dierstein

    (TU Dresden, Faculty of Business & Economics, Chair of Energy Economics)

  • Dominik Möst

    (TU Dresden, Faculty of Business & Economics, Chair of Energy Economics)

  • Matthew Schmidt

    (TU Dresden, Faculty of Business & Economics, Chair of Energy Economics)

Abstract

Much of energy economics curricula involves the study of techno-economic aspects of energy systems with an increasing focus devoted to fostering an understanding of the interactions between innovative technologies and adaptive markets. As the interplay of these dynamics and their impacts on market equilibria and outcomes is quite complex, optimization models are well-suited to facilitate their study. This paper presents two exemplary model approaches and associated case studies, which can be employed to study market developments driving long-term adaptations in the portfolio of power-generation assets as well as scheduling problems of individual plant owners with a focus on assessing the impact of changing market conditions on the profitability of investments. The combination of these two modelling approaches constitutes an innovative means of facilitating students’ understanding of how individual decisions of different market stakeholders lead to welfare-maximizing market equilibria under the assumption of perfect competition. The models are discussed along with the experiences acquired employing them in various forms as project assignments. In summary, the integration of modelling exercises and assignments into the curriculum of energy economics courses has proven to be a practical means of reinforcing and broadening lecture material that is both interesting and rewarding for students.

Suggested Citation

  • Hannes Hobbie & Constantin Dierstein & Dominik Möst & Matthew Schmidt, 2023. "Learning by Doing: Insights from Power Market Modelling in Energy Economics Courses," SN Operations Research Forum, Springer, vol. 4(2), pages 1-28, June.
    • Handle: RePEc:spr:snopef:v:4:y:2023:i:2:d:10.1007_s43069-023-00203-w
    DOI: 10.1007/s43069-023-00203-w
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1007/s43069-023-00203-w
    File Function: Abstract
    Download Restriction: Access to the full text of the articles in this series is restricted.
    File URL: https://libkey.io/10.1007/s43069-023-00203-w?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Kougias, Ioannis & Szabó, Sándor, 2017. "Pumped hydroelectric storage utilization assessment: Forerunner of renewable energy integration or Trojan horse?," Energy, Elsevier, vol. 140(P1), pages 318-329.
    2. Rehman, Shafiqur & Al-Hadhrami, Luai M. & Alam, Md. Mahbub, 2015. "Pumped hydro energy storage system: A technological review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 44(C), pages 586-598.
    3. Schill, Wolf-Peter, 2014. "Residual load, renewable surplus generation and storage requirements in Germany," Energy Policy, Elsevier, vol. 73(C), pages 65-79.
    4. Ventosa, Mariano & Baillo, Alvaro & Ramos, Andres & Rivier, Michel, 2005. "Electricity market modeling trends," Energy Policy, Elsevier, vol. 33(7), pages 897-913, May.
    5. Steffen, Bjarne, 2012. "Prospects for pumped-hydro storage in Germany," Energy Policy, Elsevier, vol. 45(C), pages 420-429.
    6. Oliveira, P. & McKee, S. & Coles, C., 1993. "Optimal scheduling of a hydro thermal power generation system," European Journal of Operational Research, Elsevier, vol. 71(3), pages 334-340, December.
    7. Barbour, Edward & Wilson, I.A. Grant & Radcliffe, Jonathan & Ding, Yulong & Li, Yongliang, 2016. "A review of pumped hydro energy storage development in significant international electricity markets," Renewable and Sustainable Energy Reviews, Elsevier, vol. 61(C), pages 421-432.
    8. Joan Robinson, 1934. "What is Perfect Competition?," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 49(1), pages 104-120.
    9. Eising, Manuel & Hobbie, Hannes & Möst, Dominik, 2020. "Future wind and solar power market values in Germany — Evidence of spatial and technological dependencies?," Energy Economics, Elsevier, vol. 86(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Javed, Muhammad Shahzad & Ma, Tao & Jurasz, Jakub & Amin, Muhammad Yasir, 2020. "Solar and wind power generation systems with pumped hydro storage: Review and future perspectives," Renewable Energy, Elsevier, vol. 148(C), pages 176-192.
    2. Mahfoud, Rabea Jamil & Alkayem, Nizar Faisal & Zhang, Yuquan & Zheng, Yuan & Sun, Yonghui & Alhelou, Hassan Haes, 2023. "Optimal operation of pumped hydro storage-based energy systems: A compendium of current challenges and future perspectives," Renewable and Sustainable Energy Reviews, Elsevier, vol. 178(C).
    3. Hunt, Julian David & Freitas, Marcos Aurélio Vasconcelos de & Pereira Junior, Amaro Olímpio, 2017. "A review of seasonal pumped-storage combined with dams in cascade in Brazil," Renewable and Sustainable Energy Reviews, Elsevier, vol. 70(C), pages 385-398.
    4. Hoffstaedt, J.P. & Truijen, D.P.K. & Fahlbeck, J. & Gans, L.H.A. & Qudaih, M. & Laguna, A.J. & De Kooning, J.D.M. & Stockman, K. & Nilsson, H. & Storli, P.-T. & Engel, B. & Marence, M. & Bricker, J.D., 2022. "Low-head pumped hydro storage: A review of applicable technologies for design, grid integration, control and modelling," Renewable and Sustainable Energy Reviews, Elsevier, vol. 158(C).
    5. Mensah, Johnson Herlich Roslee & Santos, Ivan Felipe Silva dos & Raimundo, Danielle Rodrigues & Costa de Oliveira Botan, Maria Cláudia & Barros, Regina Mambeli & Tiago Filho, Geraldo Lucio, 2022. "Energy and economic study of using Pumped Hydropower Storage with renewable resources to recover the Furnas reservoir," Renewable Energy, Elsevier, vol. 199(C), pages 320-334.
    6. Vasileios Kitsikoudis & Pierre Archambeau & Benjamin Dewals & Estanislao Pujades & Philippe Orban & Alain Dassargues & Michel Pirotton & Sebastien Erpicum, 2020. "Underground Pumped-Storage Hydropower (UPSH) at the Martelange Mine (Belgium): Underground Reservoir Hydraulics," Energies, MDPI, vol. 13(14), pages 1-16, July.
    7. Mararakanye, Ndamulelo & Bekker, Bernard, 2019. "Renewable energy integration impacts within the context of generator type, penetration level and grid characteristics," Renewable and Sustainable Energy Reviews, Elsevier, vol. 108(C), pages 441-451.
    8. Wesseh, Presley K. & Benjamin, Nelson I. & Lin, Boqiang, 2022. "The coordination of pumped hydro storage, electric vehicles, and climate policy in imperfect electricity markets: Insights from China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 160(C).
    9. Stenzel, Peter & Linssen, Jochen, 2016. "Concept and potential of pumped hydro storage in federal waterways," Applied Energy, Elsevier, vol. 162(C), pages 486-493.
    10. Dallinger, Bettina & Schwabeneder, Daniel & Lettner, Georg & Auer, Hans, 2019. "Socio-economic benefit and profitability analyses of Austrian hydro storage power plants supporting increasing renewable electricity generation in Central Europe," Renewable and Sustainable Energy Reviews, Elsevier, vol. 107(C), pages 482-496.
    11. Tran, Thomas T.D. & Smith, Amanda D., 2017. "fEvaluation of renewable energy technologies and their potential for technical integration and cost-effective use within the U.S. energy sector," Renewable and Sustainable Energy Reviews, Elsevier, vol. 80(C), pages 1372-1388.
    12. Morabito, Alessandro & Hendrick, Patrick, 2019. "Pump as turbine applied to micro energy storage and smart water grids: A case study," Applied Energy, Elsevier, vol. 241(C), pages 567-579.
    13. Binama, Maxime & Kan, Kan & Chen, Hui-Xiang & Zheng, Yuan & Zhou, Daqing & Su, Wen-Tao & Muhirwa, Alexis & Ntayomba, James, 2021. "Flow instability transferability characteristics within a reversible pump turbine (RPT) under large guide vane opening (GVO)," Renewable Energy, Elsevier, vol. 179(C), pages 285-307.
    14. Vasudevan, Krishnakumar R. & Ramachandaramurthy, Vigna K. & Venugopal, Gomathi & Ekanayake, J.B. & Tiong, S.K., 2021. "Variable speed pumped hydro storage: A review of converters, controls and energy management strategies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 135(C).
    15. Hunt, Julian David & Zakeri, Behnam & Lopes, Rafael & Barbosa, Paulo Sérgio Franco & Nascimento, Andreas & Castro, Nivalde José de & Brandão, Roberto & Schneider, Paulo Smith & Wada, Yoshihide, 2020. "Existing and new arrangements of pumped-hydro storage plants," Renewable and Sustainable Energy Reviews, Elsevier, vol. 129(C).
    16. Fan, Xiaoyu & Guo, Luna & Ji, Wei & Chen, Liubiao & Wang, Junjie, 2023. "Liquid air energy storage system based on fluidized bed heat transfer," Renewable Energy, Elsevier, vol. 215(C).
    17. Lin, Boqiang & Wu, Wei & Bai, Mengqi & Xie, Chunping & Radcliffe, Jonathan, 2019. "Liquid air energy storage: Price arbitrage operations and sizing optimization in the GB real-time electricity market," Energy Economics, Elsevier, vol. 78(C), pages 647-655.
    18. Tahseen, Samiha & Karney, Bryan W., 2017. "Reviewing and critiquing published approaches to the sustainability assessment of hydropower," Renewable and Sustainable Energy Reviews, Elsevier, vol. 67(C), pages 225-234.
    19. Tom Brijs & Arne van Stiphout & Sauleh Siddiqui & Ronnie Belmans, 2016. "Evaluating the Role of Electricity Storage by Considering Short-Term Operation in Long-Term Planning," Discussion Papers of DIW Berlin 1624, DIW Berlin, German Institute for Economic Research.
    20. Weiss, Olga & Pareschi, Giacomo & Georges, Gil & Boulouchos, Konstantinos, 2021. "The Swiss energy transition: Policies to address the Energy Trilemma," Energy Policy, Elsevier, vol. 148(PA).

    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:spr:snopef:v:4:y:2023:i:2:d:10.1007_s43069-023-00203-w. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    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.