About the lab
Agent-based modelling of energy systems with AMIRIS
Featured projects (1)
The TradeRES project will develop and test innovative electricity market designs that can meet society’s needs of a (near) 100% renewable power system. A long-term sustainable market design needs to provide efficient operational and investment incentives for an electricity system that is characterized by a high share of variable renewable energy sources (VREs) by increasing integration with other energy sectors, e.g. transport and hydrogen, and by increasing participation of flexible electricity demand from households to industrial consumers. Furthermore, this market design needs to provide security of supply by ensuring sufficient controllable electricity generation capacity whilst being economically efficient. Finally, despite the variability of solar and wind energy, the market risks should be allocated in an efficient and socially accepted way. This should also safeguard that consumers are not exposed to extreme swings in their energy expenses. In this sense, this project aims at finding market designs that are economically efficient in the above setting. To achieve these goals the project will use an iterative methodology and involve the key players from the energy sector in order to achieve and test the most suitable market designs. The project TradeRES – Tools for the Design and Modelling of New Markets and Negotiation Mechanisms for a ~100% Renewable European Power System, is funded by the EU framework programme for research and innovation Horizon 2020 under the call H2020-LC-SC3-2019-ES-SCC.
Featured research (39)
We report a potential self-reinforcing design flaw in the variable market premium scheme that occurs if variable renewable energy power plants receiving a premium become price-setting in the market. A high share of renewable energy is a goal of many countries on their transformation path to a sustainable future. Accordingly, policies like feed-in tariffs have been in place for many years in many countries to support investment. To foster market alignment, variable market premia have been introduced in at least 12 European countries and a further dozen additional countries worldwide. We demonstrate both with a mathematical model and different scenarios of an agent-based simulation that the combination of variable premia and a high share of hours in which renewables are price-setting may lead to a self-reinforcing downward spiral of prices if unchecked. This is caused by the market premium opening up the bidding space towards negative prices. We discuss possible objections and countermeasures and evaluate the severity of this market design flaw.
We conducted a scenario exploration using the agent-based energy system model AMIRIS. The fast model execution allows multiple scenario evaluations. Our analyses reveal multi-dimensional dependencies of different parameters, such as CO2 price, fuel costs, VRE share, flexibility in terms of storage, electricity demand, technological learning and coal phase-out. CO2 price turns out to be robust against other parameter configurations regarding the reduction of CO2 emissions. Further research is planned on parameter complexity and path dependence of energy systems.
We report a potential self-reinforcing design flaw in the variable market premium scheme that occurs if variable renewable energy (VRE) power plants receiving a premium become price-setting in the market. A high share (>60%) of renewable energies is a goal of many countries on their transformation path to a sustainable future. Accordingly, policies like feed-in tariffs have been in place for many years in many countries to support investment. To further market alignment, variable market premia have been introduced. We demonstrate with an agent-based simulation model (AMIRIS) that the combination of variable premia and a high share of renewables in the market may lead to a downward spiral of prices if unchecked. Given current policy schemes, these results apply to at least 12 European countries and a dozen additional countries world-wide. Hence, we evaluate the severity of this market design flaw and discuss countermeasures.