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Modelling Dynamic Constraints in Electricity Markets and the Costs of Uncertain Wind Output

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Author Info
Müsgens, F.
Neuhoff, K.

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Abstract

Building on models that represent inter-temporal constraints in the optimal production decisions for electricity generation, the paper analysis the resulting costs and their impact on prices during the day. We linearise the unit commitment problem to facilitate the interpretation of shadow prices. Analytic research gives insights for a system with one technology and numeric implementation provides results for the German power system. The model is expanded to a stochastic optimisation with recourse. The model is used to calculate the cost of wind uncertainty and the value of updating wind forecasts.

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File URL: http://www.electricitypolicy.org.uk/pubs/wp/eprg0514.pdf
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Publisher Info
Paper provided by Faculty of Economics, University of Cambridge in its series Cambridge Working Papers in Economics with number 0610.

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Length: 25
Date of creation: Feb 2006
Date of revision:
Handle: RePEc:cam:camdae:0610

Note: IO
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Web page: http://www.econ.cam.ac.uk/index.htm

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Related research
Keywords: Electricity Markets Energy Modelling Optimisation Models

Find related papers by JEL classification:
C61 - Mathematical and Quantitative Methods - - Mathematical Methods and Programming - - - Optimization Techniques; Programming Models; Dynamic Analysis
Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply

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This page was last updated on 2008-9-28.


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