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Tools for the Design and modelling of new markets and negotiation mechanisms for a ~100% Renewable European Power Systems

Project description

DEENESFRITPL

Putting renewable models to the test

Europe’s renewable energy policies are among the most ambitious in the world. The move towards a near 100 % renewable European power system requires an innovative electricity market design. The EU-funded TradeRES project will test a market design in a sophisticated simulation environment that includes real-world characteristics. It will compare quantitative indicators (security of supply, average costs to consumers and investment cost recovery) to a benchmark calculation of an optimal power system. According to the project, it is essential to provide efficient operational and investment incentives for an electricity system that is characterised by a high share of variable renewable energy sources and is highly integrated in sectors like home heating and cooling and transport.

Objective

Tools for the Design and modelling of new markets and negotiation mechanisms for a ~100% Renewable European Power System


The objective of this project is to develop and test an innovative electricity market design that can meet society’s needs in a (near) 100% renewable power system. Such 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, that is highly integrated with sectors such as home heating and cooling and transport, and needs to provide efficient incentives for the participation of all demand, from households to industrial consumers. It needs to provide security of supply by ensuring sufficient controllable electricity generation capacity without becoming too costly. And despite the variability of solar and wind energy the price risk must be limited: for investors, so the cost of capital does not become too high, and for consumers so they are not exposed to unmanageable swings in their energy expenses.

In this project, a market design will be developed that meets these objectives. It will be tested in a sophisticated simulation environment in which real-world characteristics such as actors’ limited foresight into the future and risk aversion are included. The performance of the market design - with respect to quantitative indicators such as security of supply, average costs to consumers and investment cost recovery - will be compared to a benchmark calculation of an optimal power system, which will also be developed in this project. We will involve representatives of all key stakeholder groups - consumers, large and small power generators, network operators and government in all phases of the process, in the market design as well as the development of the optimization and simulation models, in order to ensure the social acceptability of the research process and outcomes.

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Programme(s)

Topic(s)

Call for proposal

H2020-LC-SC3-2018-2019-2020

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Sub call

H2020-LC-SC3-2019-ES-SCC

Funding Scheme

RIA - Research and Innovation action

Coordinator

Laboratorio Nacional de Energia e Geologia I.P.
Net EU contribution
€ 610 666,25
Address
Rua da Amieira
4466-901 S.Mamede De Infesta
Portugal

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Region
Continente Norte Área Metropolitana do Porto
Activity type
Research Organisations
Links
Total cost
€ 610 666,25

Participants (10)

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Last update: 28 December 2023

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Permalink: https://cordis.europa.eu/project/id/864276

European Union, 2024