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The Impact of Renewable Energy Generation on the Spot Market Price in Germany: Ex-Post Analysis using Boosting Method

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  • Alexander Ryota Keeley, Kenichi Matsumoto, Kenta Tanaka, Yogi Sugiawan, and Shunsuke Managi

Abstract

This study combines regression analysis with machine learning analysis to study the merit order effect of renewable energy focusing on German market, the largest market in Europe with high renewable energy penetration. The results show that electricity from wind and solar sources reduced the spot market price by 9.64 ¬/MWh on average during the period from 2010 to 2017. Wind had a relatively stable impact across the day, ranging from 5.88 ¬/MWh to 8.04 ¬/MWh, while the solar energy impact varied greatly across different hours, ranging from 0.24 ¬/MWh to 11.78 ¬/MWh and having a stronger impact than wind during peak hours. The results also show characteristics of the interactions between renewable energy and spot market prices, including the slightly diminishing merit order effect of renewable energy at high generation volumes. Finally, a scenario-based analysis illustrates how different proportions of wind and solar energies affect the spot market price.

Suggested Citation

  • Alexander Ryota Keeley, Kenichi Matsumoto, Kenta Tanaka, Yogi Sugiawan, and Shunsuke Managi, 2020. "The Impact of Renewable Energy Generation on the Spot Market Price in Germany: Ex-Post Analysis using Boosting Method," The Energy Journal, International Association for Energy Economics, vol. 0(Special I).
    • Handle: RePEc:aen:journl:ej41-si1-keeley
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    Cited by:

    1. Gu, Jiu & Zhou, Shichao & Wang, Lingling & Jiang, Chuanwen & Li, Zuyi, 2025. "A generation directrix-based regulation energy market mechanism for fairer competition in power systems with high renewable energy penetration," Energy, Elsevier, vol. 315(C).
    2. Ryszard Bartnik & Dariusz Pączko, 2021. "Methodology for Analysing Electricity Generation Unit Costs in Renewable Energy Sources (RES)," Energies, MDPI, vol. 14(21), pages 1-15, November.
    3. Sakaguchi, Makishi & Fujii, Hidemichi, 2021. "The impact of variable renewable energy penetration on wholesale electricity prices in Japan," MPRA Paper 110554, University Library of Munich, Germany.
    4. Shimomura, Mizue & Keeley, Alexander Ryota & Matsumoto, Ken'ichi & Tanaka, Kenta & Managi, Shunsuke, 2024. "Beyond the merit order effect: Impact of the rapid expansion of renewable energy on electricity market price," Renewable and Sustainable Energy Reviews, Elsevier, vol. 189(PB).
    5. Krzysztof Księżopolski & Grzegorz Maśloch, 2021. "Time Delay Approach to Renewable Energy in the Visegrad Group," Energies, MDPI, vol. 14(7), pages 1-18, March.
    6. Wang, Guanghao & Sbai, Erwann & Sheng, Mingyue Selena & Tao, Miaomiao, 2025. "News sentiment, climate conditions, and New Zealand electricity market: A real-time bidding policy perspective," Energy, Elsevier, vol. 318(C).
    7. Costinela Fortea & Marius Sorin Dinca & Romeo Victor Ionescu & Monica Laura Zlati & Valentin-Marian Antohi, 2023. "Analyzing the Socio-Economic and Energy Implications of Green Economy Transition Across Six EU Member States," European Research Studies Journal, European Research Studies Journal, vol. 0(2), pages 680-693.
    8. Kenta Tanaka & Clevo Wilson & Shunsuke Managi, 2022. "Impact of feed-in tariffs on electricity consumption," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 24(1), pages 49-72, January.

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    JEL classification:

    • F0 - International Economics - - General

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