The Effects of Electricity Generation from Solar and Wind Energy on the Day Ahead Market-Clearing Prices and Price Volatility: The Turkish Case

Authors : Mustafa Çağrı PEKER, Ayşen SİVRİKAYA

Pages : 1067-1100

Doi:10.25295/fsecon.1215578

View : 82 | Download : 79

Publication Date : 2023-05-25

Article Type : Research Paper

Abstract :Solar and wind generation are the primary tools to prevent climate change and high carbon emissions. Due to their intermittent generation characteristics, solar and wind power plants have a different impact on the market-clearing price formation compared to conventional generation sources. The paper investigates the solar and wind generation effect on the day ahead market-clearing price in Turkey between the 2016 and 2022. We used a 2nd order polynomial learner model to analyze the impact of solar and wind generation level on the market-clearing price level and volatility. We find that Dutch TTF increases market-clearing price with a coefficient of 0.24. An increase in wind and solar generation reduce the market-clearing price. Solar generation is ineffective on the market-clearing price below a certain demand level. Wind generation reduces market-clearing price with a 37.78 coefficient at low demand levels and a 6.55 coefficient at high demand levels. Solar generation has a price-reducing effect with 5.55 at high demand levels. Finally, Dutch TTF and wind generation increased volatility with coefficients of 0.04 and 0.69; solar generation reduced volatility with a coefficient of 0.83.
Keywords : Güneş, Rüzgar, Piyasa Takas Fiyatı, Toptan Elektrik Piyasaları, Gün Öncesi Piyasası