H2020 project: new market design for 100% renewable energy systems
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 new market design in a simulation environment. 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. TPM researchers Laurens de Vries and Ingrid Sanchez will be participating in the TradeRES consortium.
Sustainable market design
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 and is highly integrated with sectors such as home heating and cooling and transport. It also 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 and that meets these objectives and subsequently tested in a simulation of a future, low-carbon electricity market.