Integrated Electricity Generation Expansion and Transmission Capacity Planning: An Application to the Central European Region
AbstractThis article presents an integrated electricity dispatch and load flow model with endogenous electricity generation capacity expansion. The target is to quantify generation capacity requirements for 2030 and where within Central Europe it shall be ideally placed when taking into account the projected grid structure. We explicitly model the interdependence between grid operation and power plant placing as we investigate the contribution of centralized power plant placement on reducing the need for grid expansion. The application focuses on Germany and its neighbors and reference is made to recently published plans on grid expansion (TSO 2012). We adopt the perspective of a welfare maximizing system planner and thus determine capacity expansion levels as first-best benchmark. Results show that optimal capacity expansion levels are much lower than previous studies indicate (e.g. dena (2008); EC (2011); EWI et al. (2010); Maurer et al. (2012)). We also show that the need for grid expansion can be reduced by the appropriate placing of just a few Combined Cycle Gas Turbine (CCGT) power plants as well as the use of storage and Demand-Side-Management. The presence of intra-national HVDC lines as proposed in the Grid Development Plan of 2012 (TSO 2012) is found to significantly reduce overall congestion and the need for back-up power plants. However, the contribution of the proposed HVDC lines varies greatly from project to project, calling for a prioritization of plans.
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Bibliographic InfoPaper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 1250.
Length: 19 p.
Date of creation: 2012
Date of revision:
electricity; network planning; renewable energies; electricity markets; capacity investment;
Find related papers by JEL classification:
- D61 - Microeconomics - - Welfare Economics - - - Allocative Efficiency; Cost-Benefit Analysis
- D85 - Microeconomics - - Information, Knowledge, and Uncertainty - - - Network Formation
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
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