Estimating the value of wind energy using electricity locational marginal price
There is an increasing interest in adding renewables such as wind to electricity generation portfolios in larger amounts as one response to concern about atmospheric carbon emissions from our energy system and the resulting climate change. Most policies with the aim of promoting renewables (e.g., RPS, FIT) do not explicitly address siting issues, which for wind energy are currently approached as the intersection of wind resource, land control, and transmission factors. This work proposes the use of locational marginal price (LMP), the location and time specific cost of electricity on the wholesale market, to signal locations where generation can address electricity system insufficiency. After an examination of the spatial and temporal behavior of LMP in Michigan over the first two years of wholesale market operation, this work combines LMP with wind speed data to generate a value metric. High value sites in Michigan tend to be sites with higher wind speeds, with the bulk of value accruing in the fall and winter seasons.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Baban, Serwan M.J & Parry, Tim, 2001. "Developing and applying a GIS-assisted approach to locating wind farms in the UK," Renewable Energy, Elsevier, vol. 24(1), pages 59-71.
- Rodman, Laura C. & Meentemeyer, Ross K., 2006. "A geographic analysis of wind turbine placement in Northern California," Energy Policy, Elsevier, vol. 34(15), pages 2137-2149, October.
- Espey, Simone, 2001. "Renewables portfolio standard: a means for trade with electricity from renewable energy sources?," Energy Policy, Elsevier, vol. 29(7), pages 557-566, June.
- Lewis, Geoffrey McD., 2008. "High value wind: A method to explore the relationship between wind speed and electricity locational marginal price," Renewable Energy, Elsevier, vol. 33(8), pages 1843-1853.
- Rickerson, Wilson H. & Sawin, Janet L. & Grace, Robert C., 2007. "If the Shoe FITs: Using Feed-in Tariffs to Meet U.S. Renewable Electricity Targets," The Electricity Journal, Elsevier, vol. 20(4), pages 73-86, May.
- Brown, Sarah J. & Rowlands, Ian H., 2009. "Nodal pricing in Ontario, Canada: Implications for solar PV electricity," Renewable Energy, Elsevier, vol. 34(1), pages 170-178.
- Toke, Dave, 2005. "Explaining wind power planning outcomes:: some findings from a study in England and Wales," Energy Policy, Elsevier, vol. 33(12), pages 1527-1539, August.
- Vajjhala, Shalini, 2006. "Siting Renewable Energy Facilities: A Spatial Analysis of Promises and Pitfalls," Discussion Papers dp-06-34, Resources For the Future.
- Menz, Fredric C. & Vachon, Stephan, 2006. "The effectiveness of different policy regimes for promoting wind power: Experiences from the states," Energy Policy, Elsevier, vol. 34(14), pages 1786-1796, September.
- Bird, Lori & Bolinger, Mark & Gagliano, Troy & Wiser, Ryan & Brown, Matthew & Parsons, Brian, 2005. "Policies and market factors driving wind power development in the United States," Energy Policy, Elsevier, vol. 33(11), pages 1397-1407, July.
- Langniss, Ole & Wiser, Ryan, 2003. "The renewables portfolio standard in Texas: an early assessment," Energy Policy, Elsevier, vol. 31(6), pages 527-535, May.
- Berry, Trent & Jaccard, Mark, 2001. "The renewable portfolio standard:: design considerations and an implementation survey," Energy Policy, Elsevier, vol. 29(4), pages 263-277, March.
- Burtraw, Dallas & Palmer, Karen, 2005.
"Cost-Effectiveness of Renewable Electricity Policies,"
dp-05-01, Resources For the Future.
- Palmer, Karen & Burtraw, Dallas, 2005. "Cost-effectiveness of renewable electricity policies," Energy Economics, Elsevier, vol. 27(6), pages 873-894, November.
- Breukers, Sylvia & Wolsink, Maarten, 2007. "Wind power implementation in changing institutional landscapes: An international comparison," Energy Policy, Elsevier, vol. 35(5), pages 2737-2750, May.
When requesting a correction, please mention this item's handle: RePEc:eee:enepol:v:38:y:2010:i:7:p:3221-3231. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Zhang, Lei)
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.