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Renewable energy and its impact on thermal generation

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  • Graf, Christoph
  • Marcantonini, Claudio

Abstract

Electricity production from renewable sources generally displaces thermal generation, which leads to lower CO2 emissions in the power sector. However, the intermittent nature of many renewable technologies in combination with less residual demand leads to greater inefficiencies in the operation of existing fossil power plants. This inefficiency translates into a higher rate of emissions relative to output. In this paper we focus on Italian power installations between 2005 and 2014. Using panel econometrics, we show that a 10% increase in photovoltaics and wind infeed has reduced yearly CO2 emissions of the average thermal installation by about 2% while the average plants emissions relative to its output have increased by about 0.3%.

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  • Graf, Christoph & Marcantonini, Claudio, 2017. "Renewable energy and its impact on thermal generation," Energy Economics, Elsevier, vol. 66(C), pages 421-430.
    • Handle: RePEc:eee:eneeco:v:66:y:2017:i:c:p:421-430
    DOI: 10.1016/j.eneco.2017.07.009
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    4. Bahramian, Pejman & Jenkins, Glenn P. & Milne, Frank, 2021. "The displacement impacts of wind power electricity generation: Costly lessons from Ontario," Energy Policy, Elsevier, vol. 152(C).
    5. Graf, Christoph & Quaglia, Federico & Wolak, Frank A., 2021. "(Machine) learning from the COVID-19 lockdown about electricity market performance with a large share of renewables," Journal of Environmental Economics and Management, Elsevier, vol. 105(C).
    6. Jayanta Bhusan Basu & Subhojit Dawn & Pradip Kumar Saha & Mitul Ranjan Chakraborty & Taha Selim Ustun, 2022. "Economic Enhancement of Wind–Thermal–Hydro System Considering Imbalance Cost in Deregulated Power Market," Sustainability, MDPI, vol. 14(23), pages 1-25, November.
    7. Vadim A. Golubev & Viktoria A. Verbnikova & Ilia A. Lopyrev & Daria D. Voznesenskaya & Rashid N. Alimov & Olga V. Novikova & Evgenii A. Konnikov, 2021. "Energy Evolution: Forecasting the Development of Non-Conventional Renewable Energy Sources and Their Impact on the Conventional Electricity System," Sustainability, MDPI, vol. 13(22), pages 1-19, November.
    8. Michael C. Ferris & Andy Philpott, 2023. "Renewable electricity capacity planning with uncertainty at multiple scales," Computational Management Science, Springer, vol. 20(1), pages 1-40, December.
    9. Haxhimusa, Adhurim, 2018. "The Effects of German Wind and Solar Electricity on French Spot Price Volatility: An Empirical Investigation," Department of Economics Working Paper Series 258, WU Vienna University of Economics and Business.
    10. Beltrami, Filippo, 2024. "The impact of hydroelectric storage in Northern Italy’s power market," Energy Policy, Elsevier, vol. 191(C).
    11. Abrell, Jan & Kosch, Mirjam & Rausch, Sebastian, 2019. "Carbon abatement with renewables: Evaluating wind and solar subsidies in Germany and Spain," Journal of Public Economics, Elsevier, vol. 169(C), pages 172-202.
    12. Liu, Tingting & Xu, Jiuping, 2021. "Equilibrium strategy based policy shifts towards the integration of wind power in spot electricity markets: A perspective from China," Energy Policy, Elsevier, vol. 157(C).
    13. Mikovits, Christian & Wetterlund, Elisabeth & Wehrle, Sebastian & Baumgartner, Johann & Schmidt, Johannes, 2021. "Stronger together: Multi-annual variability of hydrogen production supported by wind power in Sweden," Applied Energy, Elsevier, vol. 282(PB).
    14. Boffino, Luigi & Conejo, Antonio J. & Sioshansi, Ramteen & Oggioni, Giorgia, 2019. "A two-stage stochastic optimization planning framework to decarbonize deeply electric power systems," Energy Economics, Elsevier, vol. 84(C).
    15. Ortega-Izquierdo, Margarita & Río, Pablo del, 2020. "An analysis of the socioeconomic and environmental benefits of wind energy deployment in Europe," Renewable Energy, Elsevier, vol. 160(C), pages 1067-1080.
    16. Braeuer, Fritz & Finck, Rafael & McKenna, Russell, 2020. "Comparing empirical and model-based approaches for calculating dynamic grid emission factors: An application to CO₂-minimizing storage dispatch in Germany," Working Paper Series in Production and Energy 44, Karlsruhe Institute of Technology (KIT), Institute for Industrial Production (IIP).
    17. Liebensteiner, Mario & Wrienz, Matthias, 2020. "Do Intermittent Renewables Threaten the Electricity Supply Security?," Energy Economics, Elsevier, vol. 87(C).
    18. Christoph Graf & Federico Quaglia & Frank A. Wolak, 2022. "(Machine) Learning from the COVID-19 Lockdown about Electricity Market Performance with a Large Share of Renewables," Papers 2211.02196, arXiv.org.
    19. Genc, Talat S. & Thille, Henry & ElMawazini, Khaled, 2020. "Dynamic competition in electricity markets under uncertainty," Energy Economics, Elsevier, vol. 90(C).

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    Keywords

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    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q42 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Alternative Energy Sources
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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