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Ambec, Stefan
and Crampes, Claude
(2010)
Electricity Production with Intermittent Sources.
TSE Working Paper, n. 10-152
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Abstract
The paper analyzes the interaction between a reliable source of electricity production and intermittent sources such as wind or solar power. We first characterize the first-best dispatch and investment in the two types of energy. We put the accent on the availability of the intermittent source as a major parameter of optimal capacity investment. We then analyze decentralization through competitive market mechanisms. We show that decentralizing first best requires to price electricity contingently on wind or solar availability. By contrast, traditional meters impose a second-best uniform pricing, which distorts the optimal mix of energy sources. Decentralizing the either cross-subsidy from the intermittent source to the reliable source of energy or structural integration of the two types of technology.
| Item Type: | Monograph (Working Paper) |
|---|---|
| Language: | English |
| Date: | 24 March 2010 |
| JEL Classification: | D24 - Production; Cost; Capital and Total Factor Productivity; Capacity D61 - Allocative Efficiency; Cost-Benefit Analysis Q27 - Renewable Resources and Conservation - Issues in International Trade Q32 - Exhaustible Resources and Economic Development Q42 - Alternative Energy Sources |
| Subjects: | B- ECONOMIE ET FINANCE |
| Divisions: | TSE-R (Toulouse) |
| Site: | UT1 |
| Date Deposited: | 18 Jan 2012 06:01 |
| Last Modified: | 02 Apr 2021 15:36 |
| OAI Identifier: | oai:tse-fr.eu:22631 |
| URI: | https://publications.ut-capitole.fr/id/eprint/3356 |
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