Seams Issues in European Transmission Investments

Buijs, Patrik; Bekaert, David; Belmans, Ronnie

doi:10.1016/j.tej.2010.10.014

Cited by 13 publications

(7 citation statements)

References 0 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…This indicates that the cost allocation of network investment is of paramount importance (cf. Buijs et al, 2010). In principle, the beneficiaries of any network upgrade should bear the costs.…”

Section: Introductionmentioning

confidence: 99%

“…We believe that this difficulty is one of the reasons why the ITC is still mainly used for compensation of transit flows (where a reference can be more easily established and the monetary transfers involved are fairly small), rather than for compensation of actual network upgrades (cf. Buijs et al, 2010). The current annual budget dispensed through the ITC is around 100 million e (Rüster et al, 2012, p. 25ff); the investment volume planned according to the TYNDP is more than 100 billion e (ENTSO-E, 2013) over the next decade.…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

National-Strategic Investment in European Power Transmission Capacity

Huppmann

Egerer

2014

SSRN Journal

View full text Add to dashboard Cite

Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in May 7, 2014Abstract The transformation of the European energy system requires substantial investment in transmission capacity to facilitate cross-border trade and to efficiently integrate renewable energy sources. However, network planning in the EU is still mainly a national prerogative. In contrast to other studies aiming to identify the pan-European (continental) welfare-optimal transmission expansion, we investigate the impact of zonal planners deciding on network investment strategically, with the aim of maximizing the sum of consumer surplus, generator profits and congestion rents in their jurisdiction. This reflects the inadequacy of current mechanisms to compensate for welfare re-allocations across national boundaries arising from network upgrades.We propose a three-stage equilibrium model to describe the Nash game between zonal planners (i.e., national governments, regulators, or system operators), each taking into account the impact of network expansion on the electricity spot market and the resulting welfare effects on the constituents within her jurisdiction. Using a four-node sample network, we identify several Nash equilibria of the game between the zonal planners, and illustrate the failure to reach the first-best welfare expansion in the absence of an effective compensation mechanism.

show abstract

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

National-Strategic Investment in European Power Transmission Capacity

Huppmann

Egerer

2014

SSRN Journal

View full text Add to dashboard Cite

show abstract

“…As it turns out, there is a power technology that effectively consumes electricity, namely pumped storage. 11 Its contribution at node , , has a negative sign. Therefore, the gross demand at node is the sum of the realizations of two different stochastic processes: Depending on the infrastructure available, load can be fully served or not.…”

Section: Physical Environmentmentioning

confidence: 99%

“…In addition to these deterministic drivers, there are unpredictable weather--related components. We assume that the deseasonalised load at each node evolves over time according to the 11 More electricity is consumed in pumping the water up to the reservoir than is generated when the water later runs down through the turbines. This is why, for electricity supplied, pumped storage is usually a negative figure. following Inhomogeneous geometric Brownian motion (IGBM):…”

Section: Physical Environmentmentioning

confidence: 99%

“…We run a number of simulations for key physical and economic variables. Optimization takes place under each of these potential settings; the objective function to be minimized involves electricity generation costs and the value of lost 4 For example, the ability to determine the savings from avoided generation costs could signal the way to some funding sources (Kindler [40]) or allow implementation of the `beneficiaries pay' principle (Buijs et al [11]). 5 New lines certainly benefit many parties.…”

Section: Introductionmentioning

confidence: 99%

See 1 more Smart Citation

Market-based valuation of transmission network expansion. A heuristic application in GB

Gómez

Abadie

Neufville

et al. 2012

Energy

View full text Add to dashboard Cite

Transmission investments are currently needed to meet an increasing electricity demand, to address security of supply concerns, and to reach carbon emissions targets. A key issue when assessing the benefits from an expanded grid concerns the valuation of the uncertain cash flows that result from the expansion. We develop a valuation model which combines optimization techniques, Monte Carlo simulation over the expansion project lifetime, and market data from futures contracts on commodities. The model allows for random failures in generation and transmission infrastructure. Uncertainty stems also from nodal loads, fuel prices, allowance prices, wind generation, and hydro generation. Thus the model accounts for the stochastic dynamics on both the demand side and the supply side. To demonstrate the model by example, we consider a simplified network with two nodes. It is intended to broadly resemble the power generation sectors in England/Wales and Scotland. We then focus on the proposed Western HVDC subsea link. We simulate the whole distribution of effects on system costs, carbon emissions, and unserved load.

show abstract