An Efficient Mechanism for Cross-border Support of Renewable Electricity in the European Union

11796 15 32274 3 51442 document 32274 An Efficient Mechanism for Cross-border Support of Renewable Electricity in the European Union.pdf application/pdf 4a1d6415400009487f7cedf9dbb3897e MD5 669671 2016-01-29 13:18:00 https://pure.iiasa.ac.at/id/eprint/11796/1/An%20Efficient%20Mechanism%20for%20Cross-border%20Support%20of%20Renewable%20Electricity%20in%20the%20European%20Union.pdf 11796 1 1 application/pdf text Conference Poster en public cc_by_nc_sa

An Efficient Mechanism for Cross-border Support of Renewable Electricity in the European Union.pdf

published 32275 2 51445 document 32275 lightbox.jpg image/png 7791beb793f2391f2d69142d6f77aff6 MD5 59923 2016-01-29 13:18:35 https://pure.iiasa.ac.at/id/eprint/11796/2/lightbox.jpg 11796 2 2 image/png other Thumbnails conversion from text to thumbnail_lightbox en public

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http://eprints.org/relation/isVersionOf https://pure.iiasa.ac.at/id/document/32274 http://eprints.org/relation/isVolatileVersionOf https://pure.iiasa.ac.at/id/document/32274 http://eprints.org/relation/isIndexCodesVersionOf https://pure.iiasa.ac.at/id/document/32274 archive 2 disk0/00/01/17/96 2016-01-19 14:51:02 2023-06-14 13:23:41 2016-01-19 15:36:21 conference_item show 1 Busch S. 8666 Nakicenovic N. 395 0000-0001-7176-4604 Ortner A. AL1075 Bedard N. An Efficient Mechanism for Cross-border Support of Renewable Electricity in the European Union pub prog_tnt The ability to exchange renewable electricity (RES-e) capacity between EU member states improves the welfare of all member states since potentials and demands for RES-e capacity vary across the EU. This notion is reflected in the promotion of so-called cooperation mechanisms by the European Commission. The existing mechanisms appear, unfortunately, to be insufficient to facilitate an efficient level of trade in capacity across the EU; only a small quantity of energy is expected to be subject to cooperation mechanisms (Klessmann et al. 2010). In order to address these challenges, in this paper we propose a new mechanism for cross-border support of renewable electricity in EU. The guiding idea is that the cross-border mechanism allocates new RES-e generating capacity across EU Member States to where it is most valuable. This can, but need not, coincide with the most cost efficient allocation. The mechanism consists of two main elements. Firstly, a cross-border impact matrix that indicates the spill-over of benefits between member states induced from the power injection of additional RES-e generating capacity. Secondly, an EU wide auction in which member states and generators of RES-e bid prices indicating their willingness to pay for additional RES-e generating capacity. Then for given parameters the auctioneer selects the set of bids that maximizes an EU-wide surplus. We find that the mechanism leads to a decentralized optimization of RES-e support in the EU, by matching high willingness to pay of member states with low cost potentials of RES-e generation, but only if the benefits of RES-e are actually delivered for the member state paying for it. Moreover, the mechanism offers the potential to significantly reduce the barriers of the current cooperation mechanism, such as transaction costs or uncertainty about costs and benefits. 2015-11 published 47 214 2268 public poster Systems Analysis 2015 - A Conference in Celebration of Howard Raiffa Laxenburg, Austria 11 -13 November, 2015 conference FALSE FALSE info:eu-repo/semantics/conferenceObject