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Asymmetries and evolution in energy market Interactions: Evidence from solar PV systems and spot electricity prices in Australia

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  • Deng, Xiuyue
  • Tao, Miaomiao
  • Poletti, Stephen

Abstract

Solar energy is becoming increasingly critical in electricity markets. While existing studies have examined the effects of solar penetration, the interdependence between solar PV system price and spot electricity price dynamics remains underexplored. Using monthly return data from August 2012 to July 2024, we apply quantile-on-quantile regression to analyze nonlinear dependencies and directional asymmetries across regions, combined with time-varying Granger causality tests to uncover evolving causal structures. The results reveal significant regional heterogeneity, closely linked to each state's solar energy share in the electricity mix. Strong asymmetric dependencies emerge in South Australia, Victoria, New South Wales, and Queensland, with causal effects shifting over time. These findings provide policymakers with critical insights for managing solar integration and optimizing wholesale electricity market regulation.

Suggested Citation

  • Deng, Xiuyue & Tao, Miaomiao & Poletti, Stephen, 2025. "Asymmetries and evolution in energy market Interactions: Evidence from solar PV systems and spot electricity prices in Australia," Renewable Energy, Elsevier, vol. 255(C).
    • Handle: RePEc:eee:renene:v:255:y:2025:i:c:s0960148125014028
    DOI: 10.1016/j.renene.2025.123740
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