Integrating economic and engineering models for future electricity market evaluation: A Swiss case study

• Published in: Energy strategy reviews 2019-08, Vol.25, p.86-106
• Main Authors: Abrell, Jan, Eser, Patrick, Garrison, Jared B., Savelsberg, Jonas, Weigt, Hannes
• Format: Article
• Language: English
• Subjects: Capacity investments; Electricity markets; integrating energy models; Network security; Renewable integration
• ISSN: 2211-467X; 2211-467X
• DOI: 10.1016/j.esr.2019.04.003

The addition of stochastic renewable resources within modern electricity markets creates a need for more flexible generation assets and for appropriate mechanisms to ensure capacity adequacy. To assess both of these issues, more cross-platform analysis is needed that can evaluate short-term reliability concerns, medium-term dispatch and price concerns, and long-term capacity expansion and market design concerns. We present an integrated modeling framework that combines a long-term investment model, a robust dispatch model of the energy market, a detailed AC network model, a novel quantification for reserves, and a rigorous evaluation of renewable energy resource potentials. We apply the framework to a business-as-usual reference case simulating the phase-out of nuclear capacity in Switzerland and a case with renewable generation targets for Switzerland. We find that the nuclear phase-out leads to a strong increase in Swiss imports. In contrast, additional renewable targets lead to a decrease of these imports. In both cases, the Swiss cross-border lines are found to be the most critical network bottlenecks and in both future cases the increased reliance on imports worsens the severity of these bottlenecks. However, the network and security assessments show no significant challenges associated with a faster and stronger renewable increase in Switzerland. •The current transition of the European electricity system raises the need for changes in the regulatory framework and market design.•For the assessment of such changes, adapted or newly developed tools are needed.•Coupling different model layers in an integrative way yields comprehensive long- and short-term assessments to support decisions about potential policy or market design options.•Considering only single layers neglects feedback effects between different spatial and temporal dimensions and could lead to an over- or underestimation of specific system developments and thereby to inadequate decision making.•We show that the application of our modeling framework to the case study of Switzerland yields results that are significantly different that other Swiss reference studies.