The burden of Germany’s energy transition: An empirical analysis of distributional effects

Frondel, Manuel; Sommer, Stephan; Vance, Colin

doi:10.1016/j.eap.2015.01.004

Cited by 97 publications

(50 citation statements)

References 12 publications

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“…In reality, the supplier would nominate the consumption on the market for the consumers under a contract and the consumers will be billed according to the mismatch from these nominations. The average bill for the SMCs exhibits an opposite trend to what was observed in Germany, where the electricity price increased by 30% from the year 2006 to 2012, while the average household income grew by 6% [54]. To improve the accuracy of the bill for the SMCs, it will be useful to include the service as well as the grid operation charges in the calculation of the bill.…”

Section: Discussionmentioning

confidence: 95%

Assessing Financial and Flexibility Incentives for Integrating Wind Energy in the Grid Via Agent-Based Modeling

et al. 2019

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This article provides an agent-based model of a hypothetical standalone electricity network to identify how the feed-in tariffs and the installed capacity of wind power, calculated in percentage of total system demand, affect the electricity consumption from renewables. It includes the mechanism of electricity pricing on the Day Ahead Market (DAM) and the Imbalance Market (IM). The extra production volumes of Electricity from Renewable Energy Sources (RES-E) and the flexibility of electrical consumption of industries is provided as reserves on the IM. Five thousand simulations were run by using the agent-based model to gather data that were then fit in linear regression models. This helped to quantify the effect of feed-in tariffs and installed capacity of wind power on the consumption from renewable energy and market prices. The consumption from renewable sources, expressed as percentage of total system consumption, increased by 8.17% for every 10% increase in installed capacity of wind power. The sharpest increase in renewable energy consumption is observed when a feed-in tariff of 0.04 €/kWh is provided to the wind farm owners, resulting in an average increase of 9.1% and 5.1% in the consumption from renewable sources while the maximum installed capacity of wind power is 35% and 100%, respectively. The regression model for the annualized DAM prices showed an increase by 0.01 €cents/kWh in the DAM prices for every 10% increase in the installed wind power capacity. With every increase of 0.01 €/kWh in the value of feed-in tariffs, the mean DAM price is lowered as compared to the previous value of the feed-in tariff. DAM prices only decrease with increasing installed wind capacity when a feed-in tariff of 0.04 €/kWh is provided. This is observed because all wind power being traded on DAM at a very cheap price. Hence, no volume of electricity is being stored for availability on IM. The regression models for predicting IM prices show that, with every 10% increase in installed capacity of wind power, the annualized IM price decreases by 0.031 and 0.34 €cents/kWh, when installed capacity of wind power is between 0 and 25%, and between 25 and 100%, respectively. The models also showed that, until the maximum installed capacity of wind power is less than 25%, the IM prices increase when the value of feed-in tariff is 0.01 and 0.04 €/kWh, but decrease for a feed-in tariff of 0.02 and 0.03 €/kWh. When installed capacity of wind power is between 25 and 100%, increasing feed-in tariffs to the value of 0.03 €/kWh result in lowering the mean IM price. However, at 0.04 €/kWh, the mean IM price is higher, showing the effect of no storage reserves being available on IM and more expensive reserves being engaged on the IM. The study concludes that the effect of increasing installed capacity of wind power is more significant on increasing consumption of renewable energy and decreasing the DAM and IM prices than the effect of feed-in tariffs. However, the effect of increasing values of both factors on the profit of RES-E producers with storage facilities is not positive, pointing to the need for customized rules and incentives to encourage their market participation and investment in storage facilities.

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Section: Discussionmentioning

confidence: 95%

Assessing Financial and Flexibility Incentives for Integrating Wind Energy in the Grid Via Agent-Based Modeling

et al. 2019

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“…This unequal distribution of costs and benefits of the energy transition has increasingly become subject of debate not only in academic literature with a focus on energy justice [12] and energy poverty [13] but also in energy policymaking at the European level. While the CEP promotes their participation in RECs as a key factor to overcome energy poverty the European legislator does not specify how to achieve this aim.…”

Section: (Emphasis By the Authors)mentioning

confidence: 99%

“…For a discussion of feed-in tariffs in the US and the exclusion of LIH see [125]. For Germany see [13].…”

Section: Incentives For Participationmentioning

confidence: 99%

Empowering Vulnerable Consumers to Join Renewable Energy Communities—Towards an Inclusive Design of the Clean Energy Package

Hanke

Lowitzsch

2020

Energies

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The unequal distribution of costs and benefits of the energy transition is a challenge for energy justice and energy policy. Although the empowerment of consumers to participate in renewable energy communities (RECs) has great potential for a just energy transition, vulnerable consumers remain underrepresented in RE projects. The recast of the European renewable energy directive obliges the European Member States to facilitate the participation of vulnerable consumers and support their inclusion in its “enabling framework” for prosumership. However, the type and specific design of corresponding measures remains unclear. Against this background this article investigates consumer empowerment in a vulnerability context. In particular we stress the need to understand how vulnerability affects participation in RECs to inform both policy makers and practitioners on its specificities and restrictions for the “enabling framework”. To prevent the inclusion of vulnerable consumers in RECs from remaining an idea on paper lawmakers need to be made aware of the implications for a consistent “enabling framework”. We argue that both individual vulnerable consumers as well as RECs need incentives and support to boost RECs’ capacity to include groups that until now remain underrepresented.

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“…Germany has had similar experiences with substantial increases in renewable charges. SeeFrondel et al (2015) for an examination of the distributional impacts in Germany.10 General equilibrium effects from funding these policies are an important issue, but not the focus of this paper.…”

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confidence: 99%

The Efficiency and Sectoral Distributional Implications of Large-Scale Renewable Policies

Reguant¹

2018

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Renewable policies have grown in popularity across states in the US, and worldwide. The costs and benefits from renewable policies are unevenly distributed across several margins. The incidence of alternative designs varies substantially across producers and consumers, across types of producers, across types of consumers, and across regions. In particular, the efficiency and distributional implications of large-scale policies crucially depend on the design of wholesale policies and how targets are set, but also on how the costs of such policies are passed-through to consumers. Given that renewable costs are mostly non-marginal, due to the large presence of fixed costs, there are many different ways to implement these policies on both the environmental design and retail pass-through margins. Using data from the California electricity market, I develop a model to illustrate the interaction between large-scale renewable policies (carbon taxes, feed-in tariffs, production subsidies and renewable portfolio standards) and their pricing to final consumers under alternative retail pricing schemes (no pass-through, marginal fees, fixed flat tariffs and Ramsey pricing). I focus on the trade-off between charging residential versus industrial consumers to highlight tensions between efficiency, distributional and environmental objectives.

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The burden of Germany’s energy transition: An empirical analysis of distributional effects

Cited by 97 publications

References 12 publications

Assessing Financial and Flexibility Incentives for Integrating Wind Energy in the Grid Via Agent-Based Modeling

Assessing Financial and Flexibility Incentives for Integrating Wind Energy in the Grid Via Agent-Based Modeling

Empowering Vulnerable Consumers to Join Renewable Energy Communities—Towards an Inclusive Design of the Clean Energy Package

The Efficiency and Sectoral Distributional Implications of Large-Scale Renewable Policies

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