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Assessing Socioeconomic Impacts of Integrating Distributed Energy Resources in Electricity Markets through Input-Output Models

Author

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  • Carmen Ramos Carvajal

    (Regional Economics Laboratory (RegioLab), Faculty of Economics and Business, Department of Applied Economic, University of Oviedo, Campus del Cristo s/n, 33006 Oviedo, Spain)

  • Ana Salomé García-Muñiz

    (Regional Economics Laboratory (RegioLab), Faculty of Economics and Business, Department of Applied Economic, University of Oviedo, Campus del Cristo s/n, 33006 Oviedo, Spain)

  • Blanca Moreno Cuartas

    (Regional Economics Laboratory (RegioLab), Faculty of Economics and Business, Department of Applied Economic, University of Oviedo, Campus del Cristo s/n, 33006 Oviedo, Spain)

Abstract

In competitive electricity markets, the growth of electricity generated by renewable sources will reduce the market price of electricity assuming marginal cost pricing. However, small renewable distributed generation (RDG) alone cannot modify the formation of electricity prices. By aggregating small RDG units into a Virtual Power Plants (as a single unit market) they are capable of dealing at the wholesale electricity market analogous to large-scale producer following in changes in wholesale prices. This paper investigates the socioeconomic impacts of different type of RDG technologies on Spanish economic sectors and households. To this end, we applied an input-output price model to detail the activities more sensitive to changes in electricity price due to RDG technologies deployment and the associated modifications in income and total output associated with the households’ consumption variation. Detailed Spanish electricity generation disaggregation of the latest available Spanish Input-Output table, which refers to 2015, was considered. It was found that the integration of RDG units in the electricity market project a better situation for the economy and Spanish households. This paper’s scope and information can be used to benefit decision-making with respect to electricity pricing policies.

Suggested Citation

  • Carmen Ramos Carvajal & Ana Salomé García-Muñiz & Blanca Moreno Cuartas, 2019. "Assessing Socioeconomic Impacts of Integrating Distributed Energy Resources in Electricity Markets through Input-Output Models," Energies, MDPI, vol. 12(23), pages 1-21, November.
    • Handle: RePEc:gam:jeners:v:12:y:2019:i:23:p:4486-:d:290671
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