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Identifying key elements for adequate simplifications of investment choices - The case of wind energy expansion

Author

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  • Arne Pöstges
  • Christoph Weber

    (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen (Campus Essen))

Abstract

The analysis of future energy systems with increasing shares of renewable energy production poses various challenges to models used in the field of energy system analysis. Aggregation is one solution to reduce the computation time of large optimization problems, especially for optimization models with endogenous capacity expansion. Since the economic viability of renewable investments is not directly driven by physical and technical characteristics but rather by the corresponding revenue and cost streams, we propose a novel aggregation method. The aggregation covers both the spatial and the technological dimension of wind investment choices, i.e. the siting as well as the turbine choice. Four value components are defined, related e.g. to the total yield or the site-specific infeed profile of investment choices. A clustering approach is applied to these value components to identify groups of investment choices that can be aggregated without excessive loss of accuracy. The approach is applied in a case study for the German electricity system and the influence of the different value components on the combined technological and spatial aggregation is analyzed.

Suggested Citation

  • Arne Pöstges & Christoph Weber, "undated". "Identifying key elements for adequate simplifications of investment choices - The case of wind energy expansion," EWL Working Papers 2101, University of Duisburg-Essen, Chair for Management Science and Energy Economics.
    • Handle: RePEc:dui:wpaper:2101
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    References listed on IDEAS

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    More about this item

    Keywords

    aggregation; clustering; value components; wind energy expansion;
    All these keywords.

    JEL classification:

    • C43 - Mathematical and Quantitative Methods - - Econometric and Statistical Methods: Special Topics - - - Index Numbers and Aggregation
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • O21 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Planning Models; Planning Policy

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