Anmerkungen:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments November 30, 2021 erstellt
Beschreibung:
Previous literature has argued that the introduction of wind power significantly in creases grid congestion. This would potentially impose a negative effect on how regional production is allocated among generators (i.e., regional allocative efficiency). By com paring a U.S. regional electricity market with a sufficient rise in wind power to one without, we evaluate whether the introduction of wind power lowers the regional alloca tive efficiency among fossil fuel generators. We find that the cost elasticity of utilization among fossil fuel generators decreases by over 40% if the generation fuel mix experi ences an increase in wind power by 10 percentage point, implying an overall reduction in regional allocative efficiency. The effects are more pronounced among peak-load gas generators and during seasons with the highest demand (i.e., summer and winter) when wind power injection is more likely to cause congestion. We also show that transmission capacity mitigates the negative impact of wind penetration. Under the wind share level as of 2013, our simulated results show that a 20% increase in transmission capacity in SPP would save regional production cost by 847 million dollars, amounting to 17.5% of the total