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Space and Time: Wind in an Investment Planning Model

Author

Listed:
  • Karsten Neuhoff

    (Faculty of Economics, University of Cambridge)

  • Andreas Ehrenmann

    (Center for operations research and econometrics, Catholic University of Louvain,)

  • Lucy Butler

    (Faculty of Economics, University of Cambridge)

  • Jim Cust

    (Faculty of Economics, University of Cambridge)

  • Harriet Hoexter

    (ICF Consulting, London Office)

Abstract

Investment planning models inform investment decisions and government policies. Current models do not capture the intermittent nature of renewable energy sources, restricting the applicability of the models for high penetrations of renewables. We provide a methodology to capture spatial variation in wind output in combination with transmission constraints. The representation of wind distributions using stochastic approaches or using extensive historic data sets exceeds computational constraints for real world application. Hence we restrict the amount of input data, and use bootstrapping to illustrate the robustness of the results. For the UK power system we model wind deployment and the value of transmission capacity.
(This abstract was borrowed from another version of this item.)

Suggested Citation

  • Karsten Neuhoff & Andreas Ehrenmann & Lucy Butler & Jim Cust & Harriet Hoexter, 2006. "Space and Time: Wind in an Investment Planning Model," Working Papers EPRG 0603, Energy Policy Research Group, Cambridge Judge Business School, University of Cambridge.
  • Handle: RePEc:enp:wpaper:eprg0603
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    References listed on IDEAS

    as
    1. Kim Keats Martinez & Karsten Neuhoff, 2005. "Allocation of carbon emission certificates in the power sector: how generators profit from grandfathered rights," Climate Policy, Taylor & Francis Journals, vol. 5(1), pages 61-78, January.
    2. MURPHY, Frederic & SMEERS, Yves, 2002. "Generation capacity expansion in imperfectly competitive restructured electricity markets," LIDAM Discussion Papers CORE 2002069, Université catholique de Louvain, Center for Operations Research and Econometrics (CORE).
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    5. Wu, Felix & Varaiya, Pravin & Spiller, Pablo & Oren, Shmuel, 1996. "Folk Theorems on Transmission Access: Proofs and Counterexamples," Journal of Regulatory Economics, Springer, vol. 10(1), pages 5-23, July.
    6. Coulomb, L. & Neuhoff, K., 2006. "Learning curves and changing product attributes: the case of wind turbines," Cambridge Working Papers in Economics 0618, Faculty of Economics, University of Cambridge.
    7. Francis Bessière, 1970. "The "Investment '85" Model of Electricite de France," Management Science, INFORMS, vol. 17(4), pages 192-211, December.
    8. DeCarolis, Joseph F. & Keith, David W., 2006. "The economics of large-scale wind power in a carbon constrained world," Energy Policy, Elsevier, vol. 34(4), pages 395-410, March.
    9. Cardell, Judith B. & Hitt, Carrie Cullen & Hogan, William W., 1997. "Market power and strategic interaction in electricity networks," Resource and Energy Economics, Elsevier, vol. 19(1-2), pages 109-137, March.
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    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Investment planning model; Wind distribution; Electricity transmission; Renewables;
    All these keywords.

    JEL classification:

    • L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
    • C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
    • C53 - Mathematical and Quantitative Methods - - Econometric Modeling - - - Forecasting and Prediction Models; Simulation Methods
    • O21 - Economic Development, Innovation, Technological Change, and Growth - - Development Planning and Policy - - - Planning Models; Planning Policy

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