Regional electricity price differences due to intermittent wind power in Germany: impact of extended transmission and storage capacities

Abstract

A fast growth of installed wind power capacity has been experienced in several European countries. In Germany, notably high wind power capacities are planned in the North. If the existing transmission capacities between individual regions become insufficient, the electricity prices will differ considerably and the system operation can become unstable. It is supposed that the extension of transmission capacities and the use of energy storages avoid this separation of individual regions. In this paper, the arising price differences between regions in Germany are estimated using a novel stochastic linear optimisation model that optimises the efficient power market operation on an hourly basis. To estimate the impact of extensions of transmission lines and energy storages on the electricity prices systematic case studies are undertaken. It is exemplarily shown that differences of electricity prices can be equalised with transmission capacity extensions whereas they remain with the use of storage devices.