Tradable certificates for renewable electricity and energy savings

Tradable green certificates (TGCs) schemes have been developed and tested in several European countries to foster market-driven penetration of renewables. These certificates guarantee that a specific volume of electricity is generated from renewable-energy source (RES). More recently certificates (tradable white certificates (TWCs)) for the electricity saved by demand-side energy-efficiency measures (EEMs) have been introduced in some European countries. Recent advances in information and communication technology have opened up new possibilities for improving energy efficiency and increasing utilization of RESs. Use of technological resources such as the Internet and smart metering can permit real-time issuing and trading of TGCs. These technologies could also permit issuing of TWC. This paper reviews current renewable TGC and TWCs schemes in Europe and describes the possibilities for combining them in an Internet-based system. In the proposed combined tradable certificate scheme, both RESs and demand-side EEMs could bid in real time through the Internet to meet a specific obligation. The energy savings from the demand-side measures would be equivalent to the same amount of green electricity production. The paper describes the needed common targets and obligations, the certificate trading rules and the possible monitoring protocol. In particular, the paper focuses on the TWCs verification issues, including the assessment of the baseline, as these poses additional problems for TWCs compared to TGCs.     

Optimal investment portfolio in renewable energy: The Spanish case

This article presents a model for investing in renewable energies in the framework of the Spanish electricity market in a way that risk is minimised for the investor while returns are maximised. The model outlined here is based on an economic model for calculating cash flows intended to obtain the internal rate of return (IRR) of the different energies being studied: wind, photovoltaic, mini hydro and thermo electrical. The IRRs obtained are considered the returns on investments, while their standard deviations are considered associated risks. In order to minimise risk, a comprehensive portfolio of investments is created that includes all of the available energies by means of a system of linear equations. The solution of the linear system is graphically checked using the efficient frontier method for the different financing options. Several case studies within the Renewable Energies Plan (PER is its Spanish abbreviation) that is in force in Spain in the period 2005–2010 are analysed in order to illustrate the method, as are other case studies using different types of financing, helping us to reach the pertinent conclusions.     

A new integrated renewable energy system for clean electricity and hydrogen fuel production

In this paper, a new renewable energy-based cogeneration system for hydrogen and electricity production is developed. Three different methods for hydrogen production are integrated with Rankine cycle for electricity production using solar energy as an energy source. In addition, a simple Rankine cycle is utilized for producing electricity. This integrated system consists of solar steam reforming cycle using molten salt as a heat carrier, solar steam reforming cycle using a volumetric receiver reactor, and electrolysis of water combined with the Rankine cycle. These cycles are simulated numerically using the Engineering Equation Solver (EES) based on the thermodynamic analyses. The overall energetic and exergetic efficiencies of the proposed system are determined, and the exergy destruction and entropy generation rates of all subcomponents are evaluated. A comprehensive parametric study for evaluating various critical parameters on the overall performance of the system is performed. The study results show that both energetic and exergetic efficiencies of the system reach 28.9% and 31.1%, respectively. The highest exergy destruction rates are found for the steam reforming furnace and the volumetric receiver reforming reactor (each with about 20%). Furthermore, the highest entropy generation rates are obtained for the steam reforming furnace and the volumetric receiver reforming reactor, with values of 174.1 kW/K and 169.3 kW/K, respectively. Additional parametric studies are undertaken to investigate how operating conditions affect the overall system performance. The results report that 60.25% and 56.14% appear to be the highest exergy and energy efficiencies at the best operating conditions.     

Renewable energy regulation and structural breaks: An empirical analysis of Spanish electricity price volatility

International experience proves that electricity prices have undergone major changes in volatility since the entry of green technologies. The intermittency of renewable sources is one of the reasons for these changes, as it leads to higher volatility in periods of higher participation by renewables. We argue that the development of the regulatory system promoting renewable electricity also plays a crucial role. We raise a question that deserves attention: could an incentive scheme induce higher share of renewables and lower volatility simultaneously? In this paper, we conduct an empirical analysis with Spanish data. We analyze possible ensuing structural changes in Spanish electricity spot price volatility from January 2002 to December 2017. We identify two structural breaks linked to important measures related to renewable electricity: (i) the abolishment of the feed-in tariff scheme; and (ii) the establishment of a more market-oriented regulation based on investment and operating costs. We conclude that stable regulatory policies reduce volatility even though the presence of renewable sources is greater. Furthermore, market-based policy measures achieve lower volatility, encouraging good integration of intermittent renewable electricity.     

Feed-in tariff and market electricity price comparison: The case of cogeneration units in Croatia

In August 2007, the Government of the Republic of Croatia instituted a feed-in tariff system, requiring the Croatian Electricity Market Operator (HROTE) to off-take the electricity produced from renewable energy sources or cogeneration units fueled by natural gas. Analysis of the off-take electricity price range, which depends on the net electrical output and electricity market trends, indicates that it is more cost effective for cogeneration units greater than 1 MW to sell their electricity on the exchange market. This was confirmed by developing a mathematical model to calculate the cost-effectiveness ratio of a cogeneration unit. This ratio represents the relation between the profit spread, i.e. the difference between the profit generated from selling the electricity on the exchange market and the profit made from dispatching the electricity to HROTE, as well as the total investment costs. The model can be applied for changes in certain parameters, such as the net electrical output, volatility and spot electricity price. The Monte Carlo method is used to obtain the most probable cost-effectiveness ratio and average future electricity price. Together with these two economic parameters and market price analysis, it is possible to calculate and calibrate an acceptable off-take electricity price.     

Generating renewable energy from oil palm biomass in Malaysia: The Feed-in Tariff policy framework

The renewable energy (RE) industry in Malaysia began in 2001 in the context of the growing concern about future depletion of conventional fuels and the global environmental concerns about greenhouse gas emissions. The Small Renewable Energy Programme (SREP) is a tool that was first designed to drive the development of the industry based on the abundance of oil palm biomass reserves and other identified renewable energy resources. Due to the slow uptake of this scheme, a new system, the Feed-in Tariff (FiT) was introduced in 2011 to stimulate the industry. By considering the deficiencies of the previous scheme, this paper examines the sustainability of the FiT policy framework in steering the future expansion of small-scale biomass renewable energy businesses in Malaysia. Resulting from the evaluation of the current policy settings and a market based appraisal, this work outlines strategies for enhancing the scheme and suggests future studies aimed at improving the flaws in the present system.     

The future of the European electricity system and the impact of fluctuating renewable energy – A scenario analysis

The ongoing transformation of the European energy system comes along with new challenges, notably increasing amounts of power generation from intermittent sources like wind and solar. How current objectives for emission reduction can be reached in the future and what the future power system will look like is, however, not fully clear. In particular, power plant investments in the long run and power plant dispatch in the short run are subject to considerable uncertainty. Therefore an approach is presented which allows electricity market development to be assessed in the presence of stochastic power feed-in and endogenous investments in power plants and renewable energies. To illustrate the range of possible future developments, five scenarios for the European electricity system up to 2050 are investigated. Both generation investments and dispatch as well as utilization of transmission lines are optimized for these scenarios and additional sensitivity analyses are carried out.     

A comprehensive review of renewable energy resources for electricity generation in Australia

Recently, renewable energy resources and their impacts have sparked a heated debate to resolve the Australian energy crisis. There are many projects launched throughout the country to improve network security and reliability. This paper aims to review the current status of different renewable energy resources along with their impacts on society and the environment. Besides, it provides for the first time the statistics of the documents published in the field of renewable energy in Australia. The statistics include information such as the rate of papers published, possible journals for finding relative paper, types of documents published, top authors, and the most prevalent keywords in the field of renewable energy in Australia. It will focus on solar, wind, biomass, geothermal and hydropower technologies and will investigate the social and environmental impacts of these technologies.     

Successful renewable energy development in a competitive electricity market: A Texas case study

The development of renewable energy in markets with competition at wholesale and retail levels poses challenges not present in areas served by vertically-integrated utilities. The intermittent nature of some renewable energy resources impact reliability, operations, and market prices, in turn affecting all market participants. Meeting renewable energy goals may require coordination among many market players.     

Evaluating the regulator: Winners and losers in the regulation of Spanish electricity distribution

The principal aim of this study is to evaluate the regulation of electricity distribution in Spain. To this end, we begin by analyzing whether the changes introduced by the regulator led distribution companies to improve their efficiency; we then address whether the reimbursements paid to the distribution companies are linked to efficiency; lastly, we examine whether consumers benefited from the efficiency improvements. We focus on Spain because the electricity regulator in that country is a longstanding pioneer in the implementation of incentive-based regulatory models. Our analysis was implemented using the regulatory model proposed by Bogetoft (1997) as a benchmark. The results show that the Spanish electricity regulator did not establish a link between efficiency and the reimbursements paid to electricity companies; in addition, the electricity companies benefited to the detriment of consumers.     

Financing rural renewable energy: A comparison between China and India

This paper analyses the current status of rural renewable energy (RRE) in China and India, develops and employs an analysis framework to study the environment, channels, instruments and innovative mechanisms of financing rural renewable energy in China and India, and makes a primary comparison.     

Wind,hydro or mixed renewable energy source: Preference for electricity products when the share of renewable energy increases

While the share of renewable energy, especially wind power, increases in the energy mix, the risk of temporary energy shortage increases as well. Thus, it is important to understand consumers' preference for the renewable energy towards the continuous growing renewable energy society. We use a discrete choice experiment to infer consumers' preferences when the share of renewable energy increases. The study results indicate that consumers are generally willing to pay extra for an increasing share of renewable energy, but the renewable energy should come from a mixture of renewable energy sources. We also found that consumers prefer to trade with their current supplier rather than another well-known supplier. This study contributes to the energy portfolio theories and the theory of energy diversification in a consumer perspective. The managerial implications of this study are also discussed.     

Drivers for renewable energy: A comparison among OECD countries

The difference in the shares of renewable energy in total primary energy supply among OECD countries is immense. We attempt to identify some key factors that may have driven this difference for renewable energy in general and bioenergy in particular. We found that besides country-specific factors, gross national product (GDP) and renewable energy and bioenergy market deployment policies have significant and positive impacts on the per capita supply of both renewable energy and bioenergy in OECD countries. R&D expenditures, energy prices, CO₂ emissions, and other energy policies are statistically insignificant in terms of their impact on renewable energy and bioenergy supply. However, this does not necessarily mean that they are not potential drivers for renewable energy and bioenergy, but rather suggests that their magnitudes have not been big enough to significantly influence energy supply based on the historical data from 1994 to 2003. These findings lead to useful policy implications for countries attempting to promote renewable energy and bioenergy development.     

State renewable energy electricity policies: An empirical evaluation of effectiveness

Over the past decade, state governments have emerged as US energy policy leaders. Across the country, states are adopting policy instruments aimed at carbon mitigation and renewable energy deployment. One of the most prevalent and innovative policy instruments is a renewable portfolio standard (RPS), which seeks to increase the share of renewable energy electrification in the electricity market. This analysis evaluates the effectiveness of state energy programs with an empirical investigation of the linkage between state RPS policy implementation and the percentage of renewable energy electricity generation across states. We use a variant of a standard fixed effects model, referred to as a fixed effects vector decomposition, with state-level data from 1998 to 2006. Results indicate that RPS implementation is not a significant predictor of the percentage of renewable energy generation out of the total generation mix, yet for each additional year that a state has an RPS policy, they are found to increase the total amount of renewable energy generation. These findings reveal a potentially significant shortcoming of RPS policies. Political institutions, natural resource endowments, deregulation, gross state product per capita, electricity use per person, electricity price, and the presence of regional RPS policies are also found to be significantly related to renewable energy deployment.     

Prospects of renewable energy utilisation for electricity generation in Bangladesh

Bangladesh has been facing a power crisis for about a decade, mainly because of inadequate power generation capacity compared with demand and the ageing infrastructure of many existing power generation facilities. Only 20% of the total population are connected to grid electricity—25% in urban areas and a mere 10% in rural areas where 80% of the total population resides. Currently, most power plants in Bangladesh (representing 84.5% of the total installed capacity) use natural gas—the main commercial primary energy source, with limited national reserves—as a fuel. Electricity supply to low-load rural and remote areas is characterised by high transmission and distribution costs and transmission losses, and heavily subsidised pricing.Renewable energy sources in Bangladesh, particularly biomass, can play a major role to meet electricity demands in the rural and remote areas of the country. The current study indicates that in 2003, the national total generation and recovery rates of biomass in Bangladesh were 148.983 and 86.276 Mtonne, respectively. In energy term, the national annual amount of the recoverable biomass is equivalent to 312.613 TWh. Considering the present national consumption of biomass, total available biomass resources potential for electricity generation vary from 183.865 to 223.794 TWh. Biomass energy potential in the individual districts of the country has been estimated for the planning small- to medium-scale biomass-to-electricity plants.     

Impact of hydrogen energy storage on California electric power system: Towards 100% renewable electricity

Decarbonization of the power sector is a key step towards greenhouse gas emissions reduction. Due to the intermittent nature of major renewable sources like wind and solar, storage technologies will be critical in the future power grid to accommodate fluctuating generation. The storage systems will need to decouple supply and demand by shifting electrical energy on many different time scales (hourly, daily, and seasonally). Power-to-Gas can contribute on all of these time scales by producing hydrogen via electrolysis during times of excess electrical generation, and generating power with high-efficiency systems like fuel cells when wind and solar are not sufficiently available. Despite lower immediate round-trip efficiency compared to most battery storage systems, the combination of devices used in Power-to-Gas allows independent scaling of power and energy capacities to enable massive and long duration storage. This study develops and applies a model to simulate the power system balance at very high penetration of renewables. Novelty of the study is the assessment of hydrogen as the primary storage means for balancing energy supply and demand on a large scale: the California power system is analyzed to estimate the needs for electrolyzer and fuel cell systems in 100% renewable scenarios driven by large additions of wind and solar capacities. Results show that the transition requires a massive increase in both generation and storage installations, e.g., a combination of 94 GW of solar PV, 40 GW of wind, and 77 GW of electrolysis systems. A mix of generation technologies appears to reduce the total required capacities with respect to wind-dominated or solar-dominated cases. Hydrogen storage capacity needs are also evaluated and possible alternatives are discussed, including a comparison with battery storage systems.     

Optimal sizing of renewable hybrids energy systems: A review of methodologies

Taking into account oil depletion, increasing population, and increasing energy demand, electrical power generation has entered into a new phase of evolution, which can be characterized mainly by increasing concerns about climate change, by a transition from a hydrocarbon-based economy, and by an efficient utilization of energy. In this sense, it seems that alternative energies have gathered considerable momentum since 1970s oil crisis. Moreover, Earth seems to have enough power to cover World’s electrical power demand but not by a single source; for this reason, recent researches have been carried out in order to design in an optimal way system’s configuration. Nevertheless, because of the randomized nature of alternative energy sources, electrical load profile, as well as the non-linear response of system components, to mention a few, is not an easy to assess the hybrid energy system performance; therefore, hybrid energy system designing has been a complex task. For this reason, the aim of this paper is to present a brief review about the sizing methodologies developed in the recent years.     

European Union's renewable energy sources and energy efficiency policy review: The Spanish perspective

The European Union's (EU) energy objectives, legislation and programmes are determinant for the current strategy for the promotion of renewable energy sources (RES) and energy efficiency (EE) in Spain, which is becoming a key element for its international competitiveness.Firstly, this article explores the evolution of the EU's energy strategy, focusing on the adopted legislations and programmes to promote RES and EE. It concludes with an analysis of the impact of those measures in Spain.     

Spanish energy roadmap to 2020: Socioeconomic implications of renewable targets

The European Union has established challenging targets for the share of renewable energies to be achieved by 2020; for Spain, 20% of the final energy consumption must be from renewable sources at such time. The aim of this paper is the analysis of the consequences for the electricity sector (in terms of excess cost of electricity, investment requirements, land occupation, CO₂ emissions and overcapacity of conventional power) of several possibilities to comply with the desired targets. Scenarios are created from different hypotheses for energy demand, biofuel share in final energy in transport, contribution of renewables for heating and cooling, renewable electricity generation (generation mix, deployment rate, learning curves, land availability) and conventional power generation (lifetime of current installations, committed deployment, fossil fuel costs and CO₂ emissions cost). A key input in the estimations presented is the technical potential and the cost of electricity from renewable sources, which have been estimated in previous, detailed studies by the present authors using a methodology based on a GIS (Geographical Information System) and high resolution meteorological data. Depending on the scenario, the attainment of the targets will lead to an increase in the cost of electricity from 19% to 37% with respect to 2007.     

Electricity market auction settings in a future Danish electricity system with a high penetration of renewable energy sources - A comparison of marginal pricing and pay-as-bid

The long-term goal for Danish energy policy is to be free of fossil fuels through the increasing use of renewable energy sources (RES) including fluctuating renewable electricity (FRE).The Danish electricity market is part of the Nordic power exchange, which uses a Marginal Price auction system (MPS) for the day-ahead auctions. The market price is thus equal to the bidding price of the most expensive auction winning unit. In the MPS, the FRE bid at prices of or close to zero resulting in reduced market prices during hours of FRE production. In turn, this reduces the FRE sources’ income from market sales. As more FRE is implemented, this effect will only become greater, thereby reducing the income for FRE producers.Other auction settings could potentially help to reduce this problem. One candidate is the pay-as-bid auction setting (PAB), where winning units are paid their own bidding price.This article investigates the two auction settings, to find whether a change of auction setting would provide a more suitable frame for large shares of FRE. This has been done with two energy system scenarios with different shares of FRE.From the analysis, it is found that MPS is generally better for the FRE sources. The result is, however, very sensitive to the base assumptions used for the calculations.