@techreport{RuhnauStieweMuesseletal., type = {Working Paper}, author = {Ruhnau, Oliver and Stiewe, Clemens and Muessel, Jarusch and Hirth, Lion}, title = {Gas demand in times of crisis. The response of German households and industry to the 2021/22 energy crisis}, pages = {8}, abstract = {Europe is in the midst of the most severe energy crisis in a generation, at the core of which is the continuously plummeting supply of Russian natural gas. With alternative supply options being limited, natural gas prices have surged. This paper empirically estimates the response of natural gas demand to the price increase, using data from Germany—the so far largest consumer of Russian natural gas. We identify the crisis response of small and large consumers separately, controlling for temperature, gas-fired power generation, and economic activity. For small consumers, including mostly households, we find a substantial demand reduction of 6\% from March onwards—most likely due to political and ethical considerations after the start of Russia's invasion of Ukraine. For industrial consumers, demand reductions started much earlier in August 2021, when wholesale prices for natural gas started to surge, with an average reduction of 11\%. We conclude that voluntary industrial demand response has played a significant role in coping with the energy crisis so far.}, language = {en} } @techreport{TiedemannStieweKratzkeetal., type = {Working Paper}, author = {Tiedemann, Silvana and Stiewe, Clemens and Kratzke, Corinna and Hirth, Lion and Jentsch, Mareike and Damm, Nicolai and Gerhardt, Norman and Pape, Carsten}, title = {Gebotszonenteilung: Auswirkungen auf den Marktwert der Erneuerbaren Energien im Jahr 2030}, publisher = {Kopernikus-Projekt Ariadne}, address = {Potsdam}, doi = {10.48485/pik.2024.002}, pages = {49}, abstract = {Eine Teilung des deutschen Marktgebietes w{\"u}rde die Marktwerte erneuerbarer Energien beeinflussen. Wind und Photovoltaik (PV) im S{\"u}den Deutschlands w{\"u}rden an Wert gewinnen, w{\"a}hrend Erneuerbare im Norden Erl{\"o}se einb{\"u}ßen w{\"u}rden. Bei einer auch zuk{\"u}nftig st{\"a}rkeren Konzentration von erneuerbaren Energien im Norden bedeutet dies insgesamt einen h{\"o}heren F{\"o}rderbedarf f{\"u}r PV - Wind w{\"a}re trotz niedriger Marktwerte in den meisten Regionen wirtschaftlich. Wenn eine regionale Steuerung erreicht werden soll, m{\"u}sste die auszuzahlende F{\"o}rderung f{\"u}r neue PV-Anlagen anhand des zonen{\"u}bergreifenden Referenzmarktwertes berechnet werden. Durchschnittliche B{\"o}rsenstrompreise w{\"u}rden durch eine Gebotszonenteilung im S{\"u}den Deutschlands leicht angehoben und im Norden gesenkt, die Effekte auf Endkundenpreise und damit verbundene Anreize zur Standortwahl von Industrieunternehmen sind allerdings als gering einzusch{\"a}tzen.}, language = {de} } @techreport{StieweXuEickeetal., type = {Working Paper}, author = {Stiewe, Clemens and Xu, Alice Lixuan and Eicke, Anselm and Hirth, Lion}, title = {Cross-border cannibalization: Spillover effects of wind and solar energy on interconnected European electricity markets}, publisher = {arXiv}, doi = {10.48550/arXiv.2405.17166}, pages = {25}, abstract = {The average revenue, or market value, of wind and solar energy tends to fall with increasing market shares, as is now evident across European electricity markets. At the same time, these markets have become more interconnected. In this paper, we empirically study the multiple cross-border effects on the value of renewable energy: on one hand, interconnection is a flexibility resource that allows to export energy when it is locally abundant, benefitting renewables. On the other hand, wind and solar radiation are correlated across space, so neighboring supply adds to the local one to depress domestic prices. We estimate both effects, using spatial panel regression on electricity market data from 2015 to 2023 from 30 European bidding zones. We find that domestic wind and solar value is not only depressed by domestic, but also by neighboring renewables expansion. The better interconnected a market is, the smaller the effect of domestic but the larger the effect of neighboring renewables. While wind value is stabilized by interconnection, solar value is not. If wind market share increases both at home and in neighboring markets by one percentage point, the value factor of wind energy is reduced by just above 1 percentage points. For solar, this number is almost 4 percentage points.}, language = {en} } @article{StieweXuEickeetal., author = {Stiewe, Clemens and Xu, Alice Lixuan and Eicke, Anselm and Hirth, Lion}, title = {Cross-border cannibalization: Spillover effects of wind and solar energy on interconnected European electricity markets}, series = {Energy Economics}, volume = {143}, journal = {Energy Economics}, publisher = {Elsevier BV}, issn = {0140-9883}, doi = {10.1016/j.eneco.2025.108251}, abstract = {The average per-MWh revenue, or market value, of wind and solar energy tends to fall with increasing market share, as is now evident across European electricity markets. At the same time, these markets are becoming more interconnected. In this paper, we empirically study cross-border effects on the value of renewable energy: On one hand, interconnection is a flexibility resource that allows to export energy when it is locally abundant, benefitting renewables. On the other hand, wind and solar patterns are correlated between countries, so neighboring supply adds to the local one to depress domestic prices. We estimate both effects, using spatial panel regression on electricity market data from 2015 to 2023 from 30 European bidding zones. We find that domestic wind and solar value is not only depressed by domestic, but also by neighboring renewables expansion. The better interconnected a market is, the smaller the effect of domestic but the larger the effect of neighboring renewables. While wind value is stabilized by interconnection, the data suggest that solar value is not. These results can be used to estimate the impact of simultaneous domestic and neighboring capacity expansion: If wind market share increases both at home and in neighboring markets by one percentage point, the value factor of wind energy is reduced by just above 1 percentage point. For solar, this number is almost 4 percentage points.}, language = {en} } @techreport{HirthTiedemannSchill, type = {Working Paper}, author = {Hirth, Lion and Tiedemann, Silvana and Schill, Wolf-Peter}, title = {Was sind eigentlich Netzentgelte?}, publisher = {Kopernikus-Projekt Ariadne}, address = {Potsdam}, doi = {10.48485/pik.2024.020}, pages = {8}, language = {de} } @article{EhrhartEickeHirthetal., author = {Ehrhart, Karl-Martin and Eicke, Anselm and Hirth, Lion and Ocker, Fabian and Ott, Marion and Schlecht, Ingmar and Wang, Runxi}, title = {Congestion Management Games in Electricity Markets}, series = {The Energy Journal}, volume = {47}, journal = {The Energy Journal}, number = {1}, doi = {10.1177/01956574251365606}, pages = {77 -- 108}, abstract = {This paper proposes a game-theoretic model to analyze the strategic behavior of inc-dec gaming in market-based congestion management (redispatch). We extend existing models by considering incomplete information about competitors' costs and a finite set of providers. We find that these extensions do not dissolve inc-dec gaming, which already occurs in our setup of two regions. We also benchmark market-based redispatch against grid investment, cost-based redispatch, and the Vickrey-Clarke-Groves mechanism. The comparison highlights a significant inefficiency of market-based redispatch and inflated redispatch payments. Finally, we study seven variations of our basic model to assess whether different market fundamentals or market design changes mitigate inc-dec gaming. None of these variations eliminate inc-dec gaming entirely.}, language = {en} }