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Large-scale integration of wind: Flexible Voluntary Curtailment Agreements under a Feed-in System with RES-E priority to avoid inefficiently negative power prices

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  • Christine Brandstätt
  • Gert Brunekreeft
  • Katy Jahnke
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    Abstract

    For the large-scale integration of electricity from renewable energy sources (RES-E), the German system seems to reach its limits. In 2009, the electricity wholesale market experienced serious negative prices at times of high wind and low demand. The feed-in system in Germany consists of a fixed feed-in price, a take-off obligation and a RES priority rule, and in practice only very restrictive use of RES-E curtailment. Exactly the latter is the problem. We argue that the overall performance of the system would improve seriously by lifting the restrictions on the use of voluntary curtailment agreements, while retaining the priority rule as such. Since generators of RES-E can only improve under this system reform, investment conditions improve, leading to higher installed RES-E capacity. This in turn implies that reduced wind output due to curtailment can actually be offset by higher wind output in all periods in which there is no problem.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0301421511002795
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    Bibliographic Info

    Paper provided by Bremer Energie Institut in its series Bremen Energy Working Papers with number 0004.

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    Length: 35 pages
    Date of creation: Dec 2010
    Date of revision:
    Publication status: Published in Energy Policy, 39(6), 2011, pp. 3732-3740.
    Handle: RePEc:bei:00bewp:0004

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    Web page: http://www.bremer-energie-institut.de/

    Related research

    Keywords: renewable energies; market design; feed-in system;

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    1. Hiroux, C. & Saguan, M., 2010. "Large-scale wind power in European electricity markets: Time for revisiting support schemes and market designs?," Energy Policy, Elsevier, vol. 38(7), pages 3135-3145, July.
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