Who invests in renewable electricity production? Empirical evidence and suggestions for further research

Transforming energy systems to fulfill the needs of a low-carbon economy requires large investments in renewable electricity production (RES-E). Recent literature underlines the need to take a closer look at the composition of the RES-E investor group in order to understand the motives and investment processes of different types of investors. However, existing energy policies generally consider RES-E investments made on a regional or national level, and target investors who evaluate their RES-E investments according to least-cost high-profit criteria. We present empirical evidence to show that RES-E investments are made by a heterogeneous group of investors, that a variety of investors exist and that their formation varies among the different types of renewable sources. This has direct implications for our understanding of the investment process in RES-E and for the study of motives and driving forces of RES-E investors. We introduce a multi-dimensional framework for analyzing differences between categories of investors, which not only considers to the standard economic dimension which is predominant in the contemporary energy literature, but also considers the entrepreneurship, innovation-adoption and institutional dimensions. The framework emphasizes the influence of four main investor-related factors on the investment process which should be studied in future research: motives, background, resources and personal characteristics.     

Adapting the French nuclear fleet to integrate variable renewable energies via the production of hydrogen: Towards massive production of low carbon hydrogen?

Producing low-carbon hydrogen at a competitive rate is becoming a new challenge with respect to efforts to reduce greenhouse gas emissions. We examine this issue in the French context, which is characterised by a high nuclear share and the target to increase variable renewables by 2050. The goal is to evaluate the extent to which excess nuclear power could contribute to producing low-carbon hydrogen.Our approach involves designing scenarios for nuclear and renewables, modelling and evaluating the potential nuclear hydrogen production volumes and costs, examining the latter through the scope of hydrogen market attractiveness and evaluating the potential of CO₂ mitigation.This article shows that as renewable shares increase, along with the hydrogen market expected growth driven by mobility uses, opportunities are created for the nuclear operator. If nuclear capacities are maintained, nuclear hydrogen production could correspond to the demand by 2030. If not, possibilities could still exist by 2050.     

Analysis of the potential production and the development of bioenergy in the province of Mendoza – Bio-fuels and biomass – Using geographic information systems

In this work, the partial results of the potential production of energy, starting from the biomass and the development of the crops, directed to the production of bio-fuels (Colza and Topinamur) in the North irrigation oasis of Mendoza, Argentina within the National Program of Bio-energy developed by INTA is presented.     

The European renewable energy target for 2030 – An impact assessment of the electricity sector

The European Union set binding targets for the reduction of greenhouse gases (GHG) and the share of renewable energy (RE) in final energy consumption by 2020. The European Council agreed to continue with this strategy through to 2030 by setting a RE target of 27% in addition to a GHG reduction target of 40%. We provide a detailed sectoral impact assessment by analyzing the implications for the electricity sector in terms of economic costs and the regional distribution of investments and shares of electricity generated from renewable energy sources (RES-E). According to the Impact Analysis by the European Commission the 27% RE target corresponds to a RES-E share of 49%. Our model-based sensitivity analysis on underlying technological and institutional assumptions shows that the cost-effective RES-E share varies between 43% and 56%. Secondly, we quantify the economic costs of these variants and those which would be incurred with higher shares. The long-term additional costs for higher RES-E shares would be less than 1% of total system costs. The third aspect relates to the regional distribution of EU-wide efforts for upscaling renewables. We point out that delivering high RES-E shares in a cost-effective manner involves considerably different efforts by the Member States.     

The last mile in the Brazilian Amazon – A potential pathway for universal electricity access

The Brazilian rural electrification initiative Luz Para Todos – LPT (Light for All) has attracted attention internationally due to its ambitious targets and significant achievements in the last decade. The initiative has proved effective in its first phase, which has been developed through the extension of the grid. Yet, there are still important challenges to provide the service to inhabitants of remote areas in the Brazilian Amazon. We identify these challenges within institutional, technology, and funding structures operating within LPT. In line with these challenges, we propose a pathway to facilitate the achievement of universal electricity access in remote areas of the region. The proposed pathway is based on three key leverage points: (i) rules guiding the relationship among new agents and communities; (ii) the implementation of small-scale power generation technologies based on local resources; and (iii) optimized subsidies. It has the potential to allow (i) a better dimensioning of off-grid solutions considering local resources and realities, (ii) the creation of adapted institutions capable of implementing and operating the required systems and, (iii) an effective operation of off-grid solutions.     

The costs of electricity interruptions in Spain. Are we sending the right signals?

One of the objectives of energy security is the uninterrupted physical availability of energy. However, there is limited information about how much is the cost of energy supply interruptions. This information is essential to optimize investment and operating decisions to prevent energy shortages, or, alternatively, to determine the strength of the signals to be sent to the agents so that they may invest accordingly. In this paper, we estimate the economic impact of an electricity interruption in different sectors and regions of Spain. Although there are several caveats in our analysis, we find that in 2008 the cost for the Spanish economy of one kWh of electricity not supplied was above €4 even in a conservative scenario, which is higher than the signals currently being sent as incentives to avoid these interruptions. This might result in an underinvestment in short-term energy security, particularly when we add the usual risk aversion of most consumers.     

Hydrogen,ethylene and power production from bioethanol: Ready for the renewable market?

The economic sustainability of renewable based sources is a matter of debate and the technology is changing very fast. We here considered three examples of exploitation of bioethanol as renewable source: a) centralised hydrogen prodution; b) heat and power cogeneration (residential scale); c) ethylene production. Bioethanol can be a suitable starting material for the production of H₂, as fuel or chemical, or syngas. After designing the process and the implementation of kinetic expressions based on experimental data collected in our lab or derived from the literature, an economic evaluation and sensitivity analysis allowed to assess the economic sustainability of hydrogen production and purification by the steam reforming of bioethanol. The attention was mainly put on diluted bioethanol solutions, easy to purify and cost effective. The centralised hydrogen production from bioethanol was considered cost effective at least starting from diluted bioethanol from first generation crops. When dowscaling the hydrogen production and purification unit to feed a 5 kW fuel cell, the most undetermined item was the fuel cell cost, since no acclarate market price is still available.Finally, ethylene market is steadily increasing by ca. 4% each year due to economic growth. The demand for renewable ethylene, as well as the increasing oil price experienced in the recent past, suggested the development of alternative routes to ethylene. Based on the increasing availability of ethanol form renewable biomass, bioethanol-to-bioethylene processes have been recently designed, finding economic sustainability, at the moment, in Brazil.     

Wind power and photovoltaic power: How to improve the accommodation capability of renewable electricity generation in China?

China's wind curtailment and photovoltaic curtailment was one of the prominent issues in 2014, and the renewable curtailment worsened in 2015. With the rapid growth of renewables, the phenomenon of the insufficiency in renewable accommodation capability is becoming more and more serious in 2016. In that case, the problem of the insufficient accommodation capability is pointed out by analyzing China's development requirements. The renewable power generation scale, the renewable power consumption, and the restrictions on the renewable electricity generation are discussed from the China's market perspective. Meanwhile, the legal environment, the planning requirement, the institutional setting, and the policy tools are introduced from the perspective of governmental regulation. An empirical analysis, a cause analysis and a trend analysis are illustrated before explaining the problem of renewable curtailment and proposing a solution for enhancing the accommodation capability. According to the analysis results, the solution for addressing the wind curtailment and PV curtailment is offered with respect to the technology, the institution, the legislation, and the political aspect. Through the research, the research conclusions are drew finally and the corresponding policy recommendations are put forward.     

What makes renewable energy successful in China? The case of the Shandong province solar water heater innovation system

The Chinese province of Shandong, and more particularly its cities Dezhou, Jinan and Rizhao, have established an international reputation of being hotbeds for solar water heating (SWH) technology development and dissemination. The article aims to unveil the evolution of this innovative environment by applying the Functions of Innovation Systems (FIS) approach to the Chinese province of Shandong. It examines the actors, institutions and policy instruments that shape Shandong's innovation system for SWH, the dominant drivers and barriers during the evolution of the TIS and also assesses the applicability of the IS approach to China. It appears that the presence of influential interest organizations and proactive support from local governments have acted as strong drivers for the emergence of Shandong's innovation system for SWHs. On the other hand, the lack of adequate personnel and an overreliance on government policies act as main barriers. With regard to the Chinese specificities potentially detracting from the relevance of applying IS theory to China, we did not find that the central government acted as an initiator of innovation nor that state-owned enterprises had dominant positions in the market. In this innovative industry the impetus for development came from the bottom up and from private corporations.     

Social demand for electricity from forest biomass in Spain: Does payment periodicity affect the willingness to pay?

In this article, we analyze social preferences for a partial substitution programme of electricity generated by conventional energy sources, for energy generated from a local renewable energy source, such as forest biomass. This analysis sets arguments in favour of accelerating the introduction of this renewable technology in the Spanish Electricity System. Simultaneously, two methodological goals concerning the contingent valuation method are discussed. In the first one, we analyze if there are statistical differences in the willingness to pay (WTP) when a single- or a double-bounded format is employed to ask the valuation question. Results show that WTP estimates from single- and double-bounded significantly differ. In the second one, we analyze the effect of the periodicity of the payment vehicle on the estimates of welfare change. The timeframe specification of the payment vehicle has been scarcely studied, and this fact constitutes the main contribution of this paper to the specialized literature. Results show that periodicity influences upon the probability to favour the proposed change. The periodicity does not affect to the mean WTP obtained in the single-bounded format, but there are statistical differences in the double-bounded format. These results might be explained by the presence of yea saying and payment scale bias.     

Dynamic production,storage, and use of renewable hydrogen: A technical-economic-environmental analysis in the public transport system in São Paulo state,Brazil

This article proposes a calculation methodology that starts from the demand calculation to supply a fleet bus with renewable hydrogen based on the electrolysis process until the energetic, economic, and environmental analyses, involving all the processes of the productive chair. Also considering the dynamic behaviour of the following hydrogen processes: production, storage, and use. The simplified scheme of the proposed system configuration to be studied consists of the use of alternative and renewable sources of energy (solar-wind-biogas) to generate electrical energy in order to produce hydrogen from electrolysis of the water, which is stored in its gaseous state and subsequently redirected to a filling station to be used as vehicle fuel in buses. The results show that to feed one bus the hybrid system generates an average of 78,110 kWh/month with an installed capacity of 1101.905 kW, producing 1209.90 kgH₂/month through the electrolysis process from water. The results also show a range of electricity generation costs between 1.130 and 0.123 US$/kWh and H₂ production between 0.963 and 0.110 US$/kWh. Concluding that the application of renewable energies to produce hydrogen and electricity for the public transport sector is an attractive alternative in the future throughout the country, because the proposed system is technically, economically and ecologically viable.     

Privatization of electricity distribution in the Northeast of Brazil: The good,the bad,the ugly or the naïve?

This paper analyzes the evolution of five electricity distribution companies in the Northeast of Brazil using technical and financial indicators. Three privatized and two public firms were analyzed between 1997 and 2008. The financial indicators are used as proxies for the capacity of the business to generate value for shareholders, while the technical indicators are used as proxies for service quality provided to consumers. We observed that the privatized firms had their financial indicators improved after privatization, increasing the value of the firm for the shareholders. However, there is no evidence that privatization affected the quality of service provided to consumers.     

What is the potential for biogas digesters to improve soil fertility and crop production in Sub-Saharan Africa?

Three alternative soil amendments of organic wastes are considered: application of untreated animal manures, bioslurry from biogas digestion, composted materials, and biochar produced by pyrolysis cook-stoves. Application of untreated manures provides high input of available nutrients, which results in an initial flush in crop growth. However, risks of losing nutrients are high because manure is usually applied before sowing to avoid reduced yields due to phytotoxicity, resulting in increased losses by leaching or volatilization. Furthermore, the heterogeneous nature of untreated manures results in immobilization of nutrients by carbon-rich materials. A greater amount of nutrients are potentially available to crops from applied bioslurry. Typically 5–10% of the nitrogen is lost during anaerobic digestion, but bioslurry provides immediately available nutrients that can be applied as needed, so reducing risks of nutrient loss. If, however, bioslurry was applied in a single dose, losses would be similar in magnitude to untreated manures. Risks of nutrient losses are also lower when wastes are applied as composts, but in contrast to bioslurry, this is because the concentration of immediately available nutrients is very low, most nutrients being held in organic form that will become available only slowly over the growing season. Composts provide an option for single dose application, but a larger proportion of nitrogen is lost during composting (26–51%) than during anaerobic digestion (5–10%). Losses of nitrogen during pyrolysis are also very high (70–90%), but biochar can reduce losses of native soil nutrients by providing exchange sites that hold nutrients in the soil.     

Membrane electrolysis of Bunsen reaction in the iodine–sulphur process for hydrogen production

In traditional IS process for production of hydrogen by water decomposition, the Bunsen reaction (SO₂ + I₂ + 2H₂O → H₂SO₄ + 2HI) was carried out by direct contact of SO₂ with aqueous solution of I₂ where a large excess of I₂ (8 mol) and H₂O (16 mol) were required. Excess amounts of these chemicals severely affected the overall thermal efficiency of the process and new ways including membrane electrolysis was reported in literature for carrying out Bunsen reaction where the amount of excess chemicals can be greatly reduced. We have carried out Bunsen reaction in a two-compartment membrane electrolysis cell containing graphite electrodes and Nafion 117 membrane as a separator between the two-compartments. Electrolysis was carried out at room temperature with continuous recirculation of anolyte and catholyte. Electrolysis was done in constant-current mode with current density in the range of 1.6 A/dm² to 4.8 A/dm². Initial concentrations of H₂SO₄ and HI were about 10 and 5 N, respectively and I₂/HI molar ratio in the catholyte was varied in the range of 0.25–1.5. Current efficiency was found to be close to 100% indicating absence of any side reaction at the electrodes. Cell voltage was found to vary linearly with current densities up to 80 A/dm² and for I₂/HI molar ratio in the range of 0.25–1.5 the cell voltage was found to be lowest for the value of 0.5.     

Levels of consumers’ agency and capacity as predictors for electricity demand reduction in the residential sector

A field study of 50 households in a collective community in Israel provides initial support for the hypotheses about the relations between actors’ agency, capacity and electricity demand reduction. ‘Agency’ refers to actors’ willingness and ability to make their own free choices and ‘capacity’ refers to actors’ ability to perform the choices they made. According to the hypotheses, change is more likely to happen when actors’ levels of agency and capacity are high; unlikely to happen when the levels are low and uncertain when there is a mismatch between levels of agency and capacity (one is high and the other low). In the research, levels of agency and capacity regarding 11 energy saving actions were self-reported and electricity consumption was metered before and during energy saving campaign. Findings show that levels of agency were lower than those of capacity for no-cost actions which require high engagement, while levels of capacity were lower than those of agency for high-cost action which require low engagement. In addition, households with high agency and high capacity reduced their electricity consumption by 9.39 % (on average); those with low agency and low capacity increased their consumption by 6.67 %; and those with a mismatch between agency and capacity reduced their consumption by 1.91 %.     

Spillover effects of distribution grid tariffs in the internal electricity market: An argument for harmonization?

In many countries, distribution grid tariffs are being reformed to adapt to the new realities of an electricity system with distributed energy resources. In Europe, legislative proposals have been made to harmonize these reforms across country borders. Many stakeholders have argued that distribution tariffs are a local affair, while the European institutions argued that there can be spillovers to other countries, which could justify a more harmonized approach. In this paper, we quantify these spillovers in a simplified numerical example to give insight and an order of magnitude. We look at different scenarios, and find that the spillovers can be both negative and positive. To be able to quantify these effects, we developed a long-run market equilibrium model that captures the wholesale market effects of distribution grid tariffs. The problem is formulated as a non-cooperative game involving consumers, generating companies and distribution system operators in a stylized electricity market.     

The unbundling regime for electricity utilities in the EU: A case of legislative and regulatory capture?

Theory and empirics suggest that by curbing competition, incumbent electricity companies which used to be, and here are referred to as, Vertically Integrated Utilities (VIUs), can increase their profitability through combined ownership of generation and transmission and/or distribution networks. Because curbing competition is generally believed to be welfare-reducing, EU law requires unbundling (separation) of the VIU networks. However, the EU allows its member states the choice between incomplete (legal) and complete (ownership) unbundling. There is tantalizing anecdotal evidence that VIUs have tried to influence this choice through questionable means of persuasion. Such means of persuasion should be more readily available in countries with a more corrupted political culture. This paper shows that among the old EU member states, countries which are perceived as more corrupt are indeed more likely to apply weaker forms of unbundling. Somewhat surprisingly, we do not obtain a similar finding for the EU member states that acceded in 2004. We provide a conjecture for this observation.     

A proposal to combine classical and hypothetical extraction input–output methods to identify key sectors for the production and distribution of electricity

This analysis explores the possibility of merging into a ‘combined’ proposal two standard I-O methods identifying key sectors, the Classical Multiplier and Hypothetical Extraction. In the context of the latest revision of the European Union Energy Efficiency Plan, we use this proposal to single out key sectors that boost potential energy savings in the economic system—specifically, in the production and distribution of electricity. Using the main distinctions and complementarities of the two traditional I-O key-sector approaches, the combined formulation allows us to disaggregate the backward stimuli of the electricity sector into three indicators: total, internal and external backward indicators. This combined proposal provides additional insights into the structure of the industrial linkages that participate in the production and distribution of electricity. Our results reveal that the explanation for the intensity of the backward effects of the electricity sector depends not only on other energy sectors but also on some manufacturing industries. We put forward that these findings may be important for developing a more balanced and cost-effective design for energy efficiency policies.     

An upper estimate for the number of limit cycles of even-degree Liénard equations in the focus case

We give an upper estimate for the number of limit cycles of the Liénard equations [(x)\dot] \dot{x} = y − F(x), [(y)\dot] \dot{y} = −x of even degree in the case where its unique singular point (0, 0) is a focus.     

The future developments of the electricity prices in view of the implementation of the Paris Agreements: Will the current trends prevail,or a reversal is ahead?

We assess the impact on the European electricity market of the European Union “Clean energy for all Europeans” package, which implements the EU Nationally Determined Contribution in Paris COP 21. We focus on the year 2030, which is the year with defined climate targets. For the assessment, we employ a game-theoretic framework of the wholesale electricity market, with high technical detail. The model is applied to two core scenarios, a Base scenario and a Low Carbon scenario to provide insights regarding the future electricity capacity, generation mix, cross-border trade and electricity prices. We also assess three additional variants of the core scenarios concerning different levels of: a) fossil and CO₂ prices; b) additional flexibility provided by batteries; c) market integration. We find that the electricity prices in 2030 substantially increase from today's level, driven by the increase in fuel and CO₂ prices. The flexibility from batteries helps in mitigating the price peaks and the price volatility. The increased low marginal cost electricity generation, the expansion of non-dispatchable and distributed capacities, and the higher market integration further reduce the market power from producers in the electricity markets from today's level.