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Anticipation for Efficient Electricity Transmission Network Investments

Author

Listed:
  • Vincent Rious

    (SUPELEC-Campus Gif - SUPELEC)

  • Jean-Michel Glachant

    (ADIS - Analyse des Dynamiques Industrielles et Sociales - UP11 - Université Paris-Sud - Paris 11 - Département d'Economie)

  • Yannick Perez

    () (ADIS - Analyse des Dynamiques Industrielles et Sociales - UP11 - Université Paris-Sud - Paris 11 - Département d'Economie)

  • Philippe Dessante

    () (SUPELEC-Campus Gif - SUPELEC)

Abstract

This paper proposes a model and preliminary results to evaluate the efficiency of anticipating the connection of power plants with shorter construction duration than the time needed to obtain the right to upgrade the network and finally to do this reinforcement. This evaluation is made in presence of a cost of anticipation related to the study of the project of network investment and to the administrative procedures needed to obtain the building agreement. This model compares a proactive TSO that anticipates the connection of new generators and then the required network reinforcement, with a reactive one that does not make any anticipation but that may then face greater congestion while the network is being reinforced. The efficiency of these behaviors is measured in terms of social cost. We find out that there exists a limit of probability for the connection of generators beyond which a proactive TSO is more efficient than a reactive one. Evaluated on a realistic case of connection, this limit of probability is found quite low, which indicates that the proactive behavior for a TSO shall generally be the optimal one.

Suggested Citation

  • Vincent Rious & Jean-Michel Glachant & Yannick Perez & Philippe Dessante, 2008. "Anticipation for Efficient Electricity Transmission Network Investments," Post-Print hal-00339254, HAL.
  • Handle: RePEc:hal:journl:hal-00339254
    Note: View the original document on HAL open archive server: https://hal-supelec.archives-ouvertes.fr/hal-00339254
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    References listed on IDEAS

    as
    1. Boyle, Glenn & Guthrie, Graeme & Meade, Richard, 2006. "Real Options and Transmission Investment: the New Zealand Grid Investment Test," Working Paper Series 3846, Victoria University of Wellington, The New Zealand Institute for the Study of Competition and Regulation.
    2. McLaren Loring, Joyce, 2007. "Wind energy planning in England, Wales and Denmark: Factors influencing project success," Energy Policy, Elsevier, vol. 35(4), pages 2648-2660, April.
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    Cited by:

    1. Keyaerts, Nico & Hallack, Michelle & Glachant, Jean-Michel & D'haeseleer, William, 2011. "Gas market distorting effects of imbalanced gas balancing rules: Inefficient regulation of pipeline flexibility," Energy Policy, Elsevier, vol. 39(2), pages 865-876, February.
    2. Woo, C.K. & Sreedharan, P. & Hargreaves, J. & Kahrl, F. & Wang, J. & Horowitz, I., 2014. "A review of electricity product differentiation," Applied Energy, Elsevier, vol. 114(C), pages 262-272.
    3. Alagappan, L. & Orans, R. & Woo, C.K., 2011. "What drives renewable energy development?," Energy Policy, Elsevier, vol. 39(9), pages 5099-5104, September.

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