@article{HirthMuehlenpfordtBulkeley, author = {Hirth, Lion and M{\"u}hlenpfordt, Jonathan and Bulkeley, Marisa}, title = {The ENTSO-E Transparency Platform. An assessment of Europe's most ambitious electricity data platform}, series = {Applied Energy}, volume = {225}, journal = {Applied Energy}, issn = {0306-2619}, doi = {10.1016/j.apenergy.2018.04.048}, url = {http://nbn-resolving.de/urn:nbn:de:kobv:b1570-opus4-28171}, pages = {1054 -- 1067}, abstract = {Applied power system research is data intensive, often requiring hour-by-hour data on electricity consumption and generation as well as detailed information about technical and cost parameters of power stations. The European Union obliges firms to publish much of this information on a common website, the "ENTSO-E Transparency Platform" operated by the association of transmission system operators. It is possibly the most ambitious platform for power system data globally. However, anecdotal evidence from users indicates significant shortcomings regarding data quality and usability. This paper provides an introduction to and an assessment of the Transparency Platform, helping researchers to use it more efficiently and to judge data quality more rigorously.}, language = {en} } @article{StefanHirthSchlechtetal, author = {Stefan, Pfenninger and Hirth, Lion and Schlecht, et. al., Ingmar}, title = {Opening the black box of energy modelling: Strategies and lessons learned}, series = {Energy Strategy Reviews}, volume = {19}, journal = {Energy Strategy Reviews}, doi = {10.1016/j.esr.2017.12.002}, pages = {63 -- 71}, abstract = {The global energy system is undergoing a major transition, and in energy planning and decision-making across governments, industry and academia, models play a crucial role. Because of their policy relevance and contested nature, the transparency and open availability of energy models and data are of particular importance. Here we provide a practical how-to guide based on the collective experience of members of the Open Energy Modelling Initiative (Openmod). We discuss key steps to consider when opening code and data, including determining intellectual property ownership, choosing a licence and appropriate modelling languages, distributing code and data, and providing support and building communities. After illustrating these decisions with examples and lessons learned from the community, we conclude that even though individual researchers' choices are important, institutional changes are still also necessary for more openness and transparency in energy research.}, language = {en} } @article{Hirth, author = {Hirth, Lion}, title = {The benefits of flexibility: The value of wind energy with hydropower}, series = {Applied Energy}, volume = {181}, journal = {Applied Energy}, doi = {10.1016/j.apenergy.2016.07.039}, pages = {210 -- 223}, abstract = {Several studies have shown that the revenue of wind power generators on spot markets ("market value") diminishes with increasing deployment. This "value drop" is mostly observed in power markets that are dominated by thermal power plants, such as in Germany. This paper assesses the wind market value in power systems where hydroelectric stations with large reservoirs prevail, such as in Sweden. Due to their dispatch flexibility, such hydropower compensates for wind power output variability and thereby mitigates the wind power value drop. The market value of electricity from wind declines with penetration in both types of power systems, but it tends to decline at a slower rate if hydropower is present. This paper presents empirical evidence on the relevance of this effect derived from market data and numerical model results. Our results indicate that when moving from 0\% to 30\% wind penetration, hydropower mitigates the value drop by a third. As a result, 1 MWh of wind energy is worth 18\% more in Sweden than in Germany. Sensitivity analyses indicate high robustness despite large parameter uncertainty: in 80\% of all sensitivities, wind energy is valuable 12-29\% more in Sweden than in Germany. The benefits of hydropower seem to level off at around 20\% wind penetration. This suggests that the hydro flexibility is "exhausted" at this level. Low wind speed wind turbines, carbon pricing, and upgrades of hydropower generation capacity can lever the added value of hydro flexibility further. Not only is wind energy more valuable in the presence of hydropower, hydroelectricity also becomes more valuable if paired with wind power.}, language = {en} } @article{Hirth, author = {Hirth, Lion}, title = {Open data for electricity modeling: Legal aspects}, series = {Energy Strategy Reviews}, journal = {Energy Strategy Reviews}, edition = {27}, doi = {10.1016/j.esr.2019.100433}, abstract = {Power system modeling is data intensive. In Europe, electricity system data is often available from sources such as statistical offices or system operators. However, it is often unclear if these data can be legally used for modeling, and in particular if such use infringes intellectual property rights. This article reviews the legal status of power system data, both as a guide for data users and for data publishers. It is based on interpretation of the law, a review of the secondary literature, an analysis of the licenses used by major data distributors, expert interviews, and a series of workshops. A core finding is that in many cases the legality of current practices is doubtful: in fact, it seems likely that modelers infringe intellectual property rights quite regularly. This is true for industry analysis but also academic researchers. A straightforward solution is open data - the idea that data can be freely used, modified, and shared by anyone for any purpose. To be open, it is not sufficient for data to be accessible free of cost, it must also come with an open data license, the most common types of which are also reviewed in this paper.}, language = {en} } @article{JerrentrupLotzTiedemannetal., author = {Jerrentrup, Lars and Lotz, Bastian and Tiedemann, Silvana and Hirth, Lion}, title = {Technology-Neutral Auctions for Renewable Energy: EU Law vs. Member State Reality}, series = {Journal for European Environmental \& Planning Law}, volume = {16}, journal = {Journal for European Environmental \& Planning Law}, edition = {4}, issn = {1876-0104}, doi = {10.1163/18760104-01604005}, url = {http://nbn-resolving.de/urn:nbn:de:kobv:b1570-opus4-30906}, pages = {386 -- 406}, abstract = {European Union competition law, intended to thwart subsidies paid out by national governments, plays an important role in shaping EU Member States' support schemes for renewable energy. The Environmental and Energy State Aid Guidelines 2014-2020, which formalize the European Commission's take on subsidies in the electricity sector, prescribe technology-neutral auctions as the standard mechanism to determine support levels. In this study, we have assessed the formal decisions of the Commission with respect to technology-neutrality between July 2014 and May 2018. It turns out that 16 out of 18 schemes are not technology-neutral and figure high degrees of technology-differentiation. We have also studied the exemption clauses invoked to justify technology-discrimination, finding that the most ambiguous clause is used most frequently, and that the application and level of scrutiny varies strongly from case to case. The State Aid Guidelines are meant to increase transparency and legal certainty. We find that with respect to technology-neutral auctions for renewable energy, the Guidelines fail to deliver on their purpose.}, language = {en} } @article{RuhnauHirthPraktiknjo, author = {Ruhnau, Oliver and Hirth, Lion and Praktiknjo, Aaron}, title = {Time series of heat demand and heat pump efficiency for energy system modeling}, series = {Nature Scientific Data}, volume = {6}, journal = {Nature Scientific Data}, number = {189}, doi = {10.1038/s41597-019-0199-y}, abstract = {With electric heat pumps substituting for fossil-fueled alternatives, the temporal variability of their power consumption becomes increasingly important to the electricity system. To easily include this variability in energy system analyses, this paper introduces the "When2Heat" dataset comprising synthetic national time series of both the heat demand and the coefficient of performance (COP) of heat pumps. It covers 16 European countries, includes the years 2008 to 2018, and features an hourly resolution. Demand profiles for space and water heating are computed by combining gas standard load profiles with spatial temperature and wind speed reanalysis data as well as population geodata. COP time series for different heat sources - air, ground, and groundwater - and different heat sinks - floor heating, radiators, and water heating - are calculated based on COP and heating curves using reanalysis temperature data. The dataset, as well as the scripts and input parameters, are publicly available under an open source license on the Open Power System Data platform.}, language = {en} } @article{KochHirth, author = {Koch, Christopher and Hirth, Lion}, title = {Short-term electricity trading for system balancing: An empirical analysis of the role of intraday trading in balancing Germany's electricity system}, series = {Renewable \& Sustainable Energy Reviews}, volume = {113}, journal = {Renewable \& Sustainable Energy Reviews}, doi = {10.1016/j.rser.2019.109275}, abstract = {Previous studies have noted that, surprisingly, Germany's dramatic expansion of wind and solar energy coincided with a reduction of short-term balancing reserves. This paper provides further and updated evidence, supporting this "German Balancing Paradox": since 2011 wind and solar energy nearly doubled while reserve requirements and reserve activation declined by around 50\%. We quantitatively explore one reason for reduced balancing needs: increased and improved short-term wholesale electricity trading. Electricity trading is now commonly done around the clock and based on quarter hours, rather than hours. The shift to quarter-hourly products alone explains a decrease in balancing energy by 17\%. We also find strong evidence for market parties to respond efficiently to imbalance charges, suggesting that market-based approaches to balancing work.}, language = {en} } @article{WieseSchlechtBunkeetal., author = {Wiese, Frauke and Schlecht, Ingmar and Bunke, Wolf-Dieter and Gerbaulet, Clemens and Hirth, Lion and Jahn, Martin and Kunz, Friedrich and Lorenz, Casimir and M{\"u}hlenpfordt, Jonathan and Reimann, Juliane and Schill, Wolf-Peter}, title = {Open Power System Data - Frictionless data for electricity system modelling}, series = {Applied Energy}, volume = {236}, journal = {Applied Energy}, doi = {10.1016/j.apenergy.2018.11.097}, pages = {409}, abstract = {The quality of electricity system modelling heavily depends on the input data used. Although a lot of data is publicly available, it is often dispersed, tedious to process and partly contains errors. We argue that a central provision of input data for modelling has the character of a public good: it reduces overall societal costs for quantitative energy research as redundant work is avoided, and it improves transparency and reproducibility in electricity system modelling. This paper describes the Open Power System Data platform that aims at realising the efficiency and quality gains of centralised data provision by collecting, checking, processing, aggregating, documenting and publishing data required by most modellers. We conclude that the platform can provide substantial benefits to energy system analysis by raising efficiency of data pre-processing, providing a method for making data pre-processing for energy system modelling traceable, flexible and reproducible and improving the quality of original data published by data providers.}, language = {en} } @article{RuhnauHirthPraktiknjo, author = {Ruhnau, Oliver and Hirth, Lion and Praktiknjo, Aaron}, title = {Heating with Wind: Economics of heat pumps and variable renewables}, series = {Energy Economics}, volume = {92}, journal = {Energy Economics}, doi = {10.1016/j.eneco.2020.104967}, abstract = {With the growth of wind and solar energy in electricity supply, the electrification of space and water heating is becoming a promising decarbonization option. In turn, such electrification may help the power system integration of variable renewables, for two reasons: thermal storage could provide low-cost flexibility, and heat demand is seasonally correlated with wind power. However, temporal fluctuations in heat demand may also imply new challenges for the power system. This study assesses the economic characteristics of electric heat pumps and wind energy and studies their interaction on wholesale electricity markets. Using a numerical electricity market model, we estimate the economic value of wind energy and the economic cost of powering heat pumps. We find that, just as expanding wind energy depresses its €/MWhel value, adopting heat pumps increases their €/MWhel cost. This rise can be mitigated by synergistic effects with wind power, "system-friendly" heat pump technology, and thermal storage. Furthermore, heat pumps raise the wind market value, but this effect vanishes if accounting for the additional wind energy needed to serve the heat pump load. Thermal storage facilitates the system integration of wind power but competes with other flexibility options. For an efficient adoption of heat pumps and thermal storage, we argue that retail tariffs for heat pump customers should reflect their underlying economic cost.}, language = {en} } @article{EickeKhannaHirth, author = {Eicke, Anselm and Khanna, Tarun and Hirth, Lion}, title = {Locational Investment Signals: How to Steer the Siting of New Generation Capacity in Power Systems?}, series = {The Energy Journal}, volume = {41}, journal = {The Energy Journal}, number = {6}, doi = {10.5547/01956574.41.6.aeic}, pages = {281 -- 304}, abstract = {New generators located far from consumption centers require transmission infrastructure and increase network losses. The primary objective of this paper is to study signals that affect the location of generation investment. Such signals result from the electricity market itself and from additional regulatory instruments. We cluster them into five groups: locational electricity markets, deep grid connection charges, grid usage charges, capacity mechanisms, and renewable energy support schemes. We review the use of instruments in twelve major power systems and discuss relevant properties, including a quantitative estimate of their strength. We find that most systems use multiple instruments in parallel, and none of the identified instruments prevails. The signals vary between locations by up to 20 EUR per MWh. Such a difference is significant when compared to the levelized costs of combined cycle plants of 64-72 EUR per MWh in Europe.}, language = {en} } @article{RuhnauBucksteegRitteretal., author = {Ruhnau, Oliver and Bucksteeg, Michael and Ritter, David and Schmitz, Richard and B{\"o}ttger, Diana and Koch, Matthias and P{\"o}stges, Arne and Wiedmann, Michael and Hirth, Lion}, title = {Why electricity market models yield different results: Carbon pricing in a model-comparison experiment}, doi = {10.1016/j.rser.2021.111701}, abstract = {The European electricity industry, the dominant sector of the world's largest cap-and-trade scheme, is one of the most-studied examples of carbon pricing. In particular, numerical models are often used to study the uncertain future development of carbon prices and emissions. While parameter uncertainty is often addressed through sensitivity analyses, the potential uncertainty of the models themselves remains unclear from existing single-model studies. Here, we investigate such model-related uncertainty by running a structured model comparison experiment, in which we exposed five numerical power sector models to aligned input parameters—finding stark model differences. At a carbon price of 27 EUR/t in 2030, the models estimate that European power sector emissions will decrease by 36-57\% when compared to 2016. Most of this variation can be explained by the extent to which models consider the market-driven decommissioning of coal- and lignite-fired power plants. Higher carbon prices of 57 and 87 EUR/t yield a stronger decrease in carbon emissions, by 45-75\% and 52-80\%, respectively. The lower end of these ranges can be attributed to the short-term fuel switch captured by dispatch-only models. The higher reductions correspond to models that additionally consider market-based investment in renewables. By further studying cross-model variation in the remaining emissions at high carbon prices, we identify the representation of combined heat and power as another crucial driver of differences across model results.}, language = {en} } @article{CloeteRuhnauCloeteetal., author = {Cloete, Schalk and Ruhnau, Oliver and Cloete, Jan Hendrik and Hirth, Lion}, title = {Blue hydrogen and industrial base products: The future of fossil fuel exporters in a net-zero world}, publisher = {Journal of Cleaner Production Vo. 363}, doi = {10.1016/j.jclepro.2022.132347}, abstract = {Is there a place for today's fossil fuel exporters in a low-carbon future? This study explores trade channels between energy exporters and importers using a novel electricity-hydrogen-steel energy systems model calibrated to Norway, a major natural gas producer, and Germany, a major energy consumer. Under tight emission constraints, Norway can supply Germany with electricity, (blue) hydrogen, or natural gas with re-import of captured CO2. Alternatively, it can use hydrogen to produce steel through direct reduction and supply it to the world market, an export route not available to other energy carriers due to high transport costs. Although results show that natural gas imports with CO2 capture in Germany is the least-cost solution, avoiding local CO2 handling via imports of blue hydrogen (direct or embodied in steel) involves only moderately higher costs. A robust hydrogen demand would allow Norway to profitably export all its natural gas production as blue hydrogen. However, diversification into local steel production, as one example of easy-to-export industrial base products, offers an effective hedge against the possibility of lower European blue hydrogen demand. Thus, it is recommended that hydrocarbon exporters like Norway consider a strategic energy export transition to a diversified mix of blue hydrogen and climate-neutral industrial base products.}, language = {en} } @article{EickeRuhnauHirth, author = {Eicke, Anselm and Ruhnau, Oliver and Hirth, Lion}, title = {Electricity balancing as a market equilibrium: An instrument-based estimation of supply and demand for imbalance energy}, doi = {10.1016/j.eneco.2021.105455}, abstract = {Frequency stability requires equalizing supply and demand for electricity at short time scales. Such electricity balancing is often understood as a sequential process in which random shocks, such as weather events, cause imbalances that system operators close by activating balancing reserves. By contrast, we study electricity balancing as a market where the equilibrium price (imbalance price) and quantity (system imbalance) are determined by supply and demand. System operators supply imbalance energy by activating reserves; market parties that, deliberately or not, deviate from schedules create a demand for imbalance energy. The incentives for deliberate strategic deviations emerge from wholesale market prices and the imbalance price. We empirically estimate the demand curve of imbalance energy, which describes how sensitive market parties are to imbalance prices. To overcome the classical endogeneity problem of price and quantity, we deploy instruments derived from a novel theoretical framework. Using data from Germany, we find a decline in the demand for imbalance energy by 2.2 MW for each increase in the imbalance price by EUR 1 per MWh. This significant price response is remarkable because the German regulator prohibits strategic deviations. We also estimate cross-market equilibriums between intraday and imbalance markets, finding that a shock to the imbalance price triggers a subsequent adjustment of the intraday price.}, language = {en} } @article{CloeteRuhnauHirth, author = {Cloete, Schalk and Ruhnau, Oliver and Hirth, Lion}, title = {On capital utilization in the hydrogen economy: The quest to minimize idle capacity in renewables-rich energy systems}, series = {International Journal of Hydrogen Energy}, volume = {46}, journal = {International Journal of Hydrogen Energy}, number = {1}, doi = {10.1016/j.ijhydene.2020.09.197}, pages = {169 -- 188}, abstract = {The hydrogen economy is currently experiencing a surge in attention, partly due to the possibility of absorbing wind and solar energy production peaks through electrolysis. A fundamental challenge with this approach is low utilization rates of various parts of the integrated electricity-hydrogen system. To assess the importance of capacity utilization, this paper introduces a novel stylized numerical energy system model incorporating the major elements of electricity and hydrogen generation, transmission and storage, including both "green" hydrogen from electrolysis and "blue" hydrogen from natural gas reforming with CO2 capture and storage (CCS). Balancing renewables with electrolysis results in low utilization of electrolyzers, hydrogen pipelines and storage infrastructure, or electricity transmission networks, depending on whether electrolyzers are co-located with wind farms or demand centers. Blue hydrogen scenarios face similar constraints. High renewable shares impose low utilization rates of CO2 capture, transport and storage infrastructure for conventional CCS, and of hydrogen transmission and storage infrastructure for a novel process (gas switching reforming) that enables flexible power and hydrogen production. In conclusion, both green and blue hydrogen can facilitate the integration of wind and solar energy, but the cost related to low capacity utilization erodes much of the expected economic benefit.}, language = {en} } @article{BlumeWerryFaberHirthetal., author = {Blume-Werry, Eike and Faber, Thomas and Hirth, Lion and Huber, Claus and Everts, Martin}, title = {Eyes on the Price: Which Power Generation Technologies Set the Market Price?}, series = {Economics of Energy \& Environmental Policy}, volume = {10}, journal = {Economics of Energy \& Environmental Policy}, number = {1}, doi = {10.5547/2160-5890.10.1.eblu}, abstract = {Upon discussion of price setting on electricity wholesale markets, many refer to the so-called merit order model. Conventional wisdom holds that during most hours of the year, coal- or natural gas-fired power plants set the price on European markets. In this context, this paper analyses price setting on European power markets. We use a fundamental electricity market model of interconnected bidding zones to determine hourly price-setting technologies for the year 2020. We find a price-setting pattern that is more complex and nuanced than the conventional wisdom suggests: across all researched countries, coal- and natural gas-fired power plants set the price for only 40 per cent of all hours. Other power generation technologies such as wind, biomass, hydro and nuclear power plants as well as lignite-fired plants set the price during the rest of the year. On some markets, the price setting is characterised by a high level of interconnectivity and thus foreign influence - as illustrated by the example of the Netherlands. During some 75 per cent of hours, foreign power plants set the price on the Dutch market, whilst price setting in other more isolated markets is barely affected by foreign markets. Hence, applying the price setting analysis to the proposed Dutch carbon price floor, we show that different carbon prices have little effect on the technological structure of the price-setting units. In this respect, the impacts of the unilateral initiative are limited. There are, however, considerable changes to be observed in wholesale power prices, import/export balances as well as production volumes and subsequent CO2 outputs of lignite-, coal- and gas-fired power plants.}, language = {en} } @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 = {Analysis of a capacity-based redispatch mechanism}, series = {Energy Economics}, volume = {149}, journal = {Energy Economics}, publisher = {Elsevier BV}, doi = {10.1016/j.eneco.2025.108751}, abstract = {This paper discusses a capacity-based redispatch mechanism in which awarded market participants are compensated for their availability for redispatch, rather than activation. The rationale is to develop a market design that prevents so-called "inc-dec gaming" when including flexible consumers with a market-based approach. We conduct a game-theoretical analysis of a capacity-based redispatch mechanism. Our analysis reveals that despite its intention, the capacity-based redispatch is prone to undesirable behavior of market participants. The reason is that the availability payment incentivizes participants to change their energy consumption or generation behavior. However, this also applies to undesired participants who increase the redispatch requirement through participation. Under certain assumptions, the additional redispatch potential equals the additional redispatch requirement it creates. Consequently, the mechanism does not resolve network constraints, while causing costs for the compensation payments. Furthermore, we study three alternative implementation options, none of which resolves the underlying problem. It follows from our analysis that a mechanism can only be promising if it is capable to distinguish between the potential participants to exclude the undesired ones.}, language = {en} } @article{HirthKhannaRuhnau, author = {Hirth, Lion and Khanna, Tarun M. and Ruhnau, Oliver}, title = {How aggregate electricity demand responds to hourly wholesale price fluctuations}, series = {Energy Economics}, volume = {135}, journal = {Energy Economics}, publisher = {Elsevier BV}, issn = {0140-9883}, doi = {10.1016/j.eneco.2024.107652}, abstract = {Electricity needs to be consumed at the very moment of production, leading wholesale prices to fluctuate widely at (sub-)hourly time scales. This article investigates the response of aggregate electricity demand to such price variations. Using wind energy as an instrument, we estimate a significant and robust short-term price elasticity of about -0.05 in Germany and attribute this to industrial consumers. As the share of consumption that is exposed to real-time prices (currently less than 25\%) expands, we expect the aggregated price elasticity to grow.}, language = {en} } @article{RuhnauStieweMuesseletal., author = {Ruhnau, Oliver and Stiewe, Clemens and Muessel, Jarusch and Hirth, Lion}, title = {Natural gas savings in Germany during the 2022 energy crisis}, series = {Nature Energy}, journal = {Nature Energy}, doi = {10.48462/opus4-4944}, url = {http://nbn-resolving.de/urn:nbn:de:kobv:b1570-opus4-49445}, abstract = {Russia curbed its natural gas supply to Europe in 2021 and 2022, creating a grave energy crisis. This paper empirically estimates the crisis response of natural gas consumers in Germany—for decades the largest export market for Russian gas. Using a multiple regression model, we estimate the response of small consumers, industry, and power stations separately, controlling for the non-linear temperature-heating relationship, seasonality, and trends. We find significant and substantial gas savings for all consumer groups, but with differences in timing and size. For instance, industry started reducing consumption as early as September 2021, while small consumers saved substantially only since March 2022. Across all sectors, gas consumption during the second half of 2022 was 23\% below the temperature-adjusted baseline. We discuss the drivers behind these savings and draw conclusions on their role in coping with the crisis.}, language = {en} } @article{SchlechtMaurerHirth, author = {Schlecht, Ingmar and Maurer, Christoph and Hirth, Lion}, title = {Financial contracts for differences: The problems with conventional CfDs in electricity markets and how forward contracts can help solve them}, series = {Energy Policy}, volume = {186}, journal = {Energy Policy}, doi = {10.1016/j.enpol.2024.113981}, abstract = {Contracts for differences are widely seen as a cornerstone of Europe's future electricity market design. This paper is about designing such contracts. We identify the dispatch and investment distortions that conventional CfDs cause, the patches used to overcome these shortcomings, and the problems these fixes introduce. We then propose an alternative contract we call "financial" CfD. This hybrid between conventional CfDs and forward contracts mitigates revenue risk to a substantial degree while providing undistorted incentives. Like conventional CfDs, it is long-term and tailored to technology-specific (wind, solar, nuclear) generation patterns but, like forwards, decouples payments from actual generation. The proposed contract mitigates volume risk and avoids margin calls by accepting physical assets as collateral.}, language = {en} } @article{RuhnauEickeSgarlatoetal., author = {Ruhnau, Oliver and Eicke, Anselm and Sgarlato, Raffaele and Tr{\"o}ndle, Tim and Hirth, Lion}, title = {Cost-Potential Curves of Onshore Wind Energy: the Role of Disamenity Costs}, series = {Environmental and Resource Economics}, journal = {Environmental and Resource Economics}, doi = {10.1007/s10640-022-00746-2}, abstract = {Numerical optimization models are used to develop scenarios of the future energy system. Usually, they optimize the energy mix subject to engineering costs such as equipment and fuel. For onshore wind energy, some of these models use cost-potential curves that indicate how much electricity can be generated at what cost. These curves are upward sloping mainly because windy sites are occupied first and further expanding wind energy means deploying less favorable resources. Meanwhile, real-world wind energy expansion is curbed by local resistance, regulatory constraints, and legal challenges. This presumably reflects the perceived adverse effect that onshore wind energy has on the local human population, as well as other negative external effects. These disamenity costs are at the core of this paper. We provide a comprehensive and consistent set of cost-potential curves of wind energy for all European countries that include disamenity costs, and which can be used in energy system modeling. We combine existing valuation of disamenity costs from the literature that describe the costs as a function of the distance between turbine and households with gridded population data, granular geospatial data of wind speeds, and additional land-use constraints to calculate such curves. We find that disamenity costs are not a game changer: for most countries and assumptions, the marginal levelized cost of onshore wind energy increase by 0.2-12.5 €/MWh.}, language = {en} } @article{WinzerRamirezMolinaHirthetal., author = {Winzer, Christian and Ram{\´i}rez-Molina, H{\´e}ctor and Hirth, Lion and Schlecht, Ingmar}, title = {Profile contracts for electricity retail customers}, series = {Energy Policy}, volume = {195}, journal = {Energy Policy}, publisher = {Elsevier BV}, issn = {0301-4215}, doi = {10.1016/j.enpol.2024.114358}, abstract = {Decarbonization involves a large-scale expansion of low-carbon generators such as wind and solar and the electrification of heating and transport. Both space heating and battery-electric cars have significant embedded flexibility potential. Granular price signals that convey abundance or scarcity of electricity are a precondition for customers or aggregators acting on their behalf to exploit this flexibility. However, unmitigated real-time prices expose customers to electricity price risks. To tackle the dual need of providing flexibility incentives while protecting customers from cost shocks, real-time tariffs with a hedging component can be a solution. In such contracts customers pre-agree an amount of energy and a consumption profile, while hourly deviations are charged at spot prices. In this paper we analyze design options by using a dataset of anonymized smart meter data and show that profile tariffs can bring electricity bill volatility to similarly low levels as fixed tariffs while providing full flexibility incentives from spot prices.}, language = {en} } @article{DertingerHirth, author = {Dertinger, Andrea and Hirth, Lion}, title = {Reforming the electric power industry in developing economies: Evidence on efficiency and electricity access outcomes}, series = {Energy Policy}, journal = {Energy Policy}, number = {139}, doi = {10.1016/j.enpol.2020.111348}, abstract = {Since the 1990s, many developing countries have restructured their electric power industry. Policies such as breaking up, commercializing and privatizing utilities, allowing for independent power producers, installing independent regulators, and introducing competitive wholesale markets were meant to improve the industry's efficiency and service quality. We exploit more than 30 years of data from over 100 countries to investigate the impact of power sector reforms on efficiency (represented by network losses) and access to electricity (represented by connection rates and residential power consumption). Crucially, reforms are likely to be endogenous with respect to sector performance: a crisis in electricity supply might well trigger reform efforts. We deal with endogeneity using reform activity in neighboring countries as an instrument. Our results suggest that reforms strongly and positively impact electricity access. According to our preferred specification, a full reform program would increase connection rates by 20 percentage points and per capita consumption by 62 percent: these are large effects that are stable across a range of robustness checks. Moreover, the effect of improving access is largest in South Asian countries. In contrast to previous studies, we do not find robust evidence to support the theory that reforms reduce network losses.}, language = {en} } @article{Hirth, author = {Hirth, Lion}, title = {Open Data for Electricity Modeling: Legal Aspects}, series = {Energy Strategy Reviews}, journal = {Energy Strategy Reviews}, number = {27}, doi = {10.1016/j.esr.2019.100433}, abstract = {Power system modeling is data intensive. In Europe, electricity system data is often available from sources such as statistical offices or system operators. However, it is often unclear if these data can be legally used for modeling, and in particular if such use infringes intellectual property rights. This article reviews the legal status of power system data, both as a guide for data users and for data publishers. It is based on interpretation of the law, a review of the secondary literature, an analysis of the licenses used by major data distributors, expert interviews, and a series of workshops. A core finding is that in many cases the legality of current practices is doubtful: in fact, it seems likely that modelers infringe intellectual property rights quite regularly. This is true for industry analysis but also academic researchers. A straightforward solution is open data - the idea that data can be freely used, modified, and shared by anyone for any purpose. To be open, it is not sufficient for data to be accessible free of cost, it must also come with an open data license, the most common types of which are also reviewed in this paper.}, language = {en} } @article{CloeteHirth, author = {Cloete, Schalk and Hirth, Lion}, title = {Flexible power and hydrogen production: Finding synergy between CCS and variable renewables}, series = {Energy}, volume = {192}, journal = {Energy}, doi = {10.1016/j.energy.2019.116671}, abstract = {The expansion of wind and solar power is creating a growing need for power system flexibility. Dispatchable power plants with CO2 capture and storage (CCS) offer flexibility with low CO2 emissions, but these plants become uneconomical at the low running hours implied by renewables-based power systems. To address this challenge, the novel gas switching reforming (GSR) plant was recently proposed. GSR can alternate between electricity and hydrogen production from natural gas, offering flexibility to the power system without reducing the utilization rate of the capital stock embodied in CCS infrastructure. This study assesses the interplay between GSR and variable renewables using a power system model, which optimizes investment and hourly dispatch of 13 different technologies. Results show that GSR brings substantial benefits relative to conventional CCS. At a CO2 price of €100/ton, inclusion of GSR increases the optimal wind and solar share by 50\%, lowers total system costs by 8\%, and reduces system emissions from 45 to 4 kgCO2/MWh. In addition, GSR produces clean hydrogen equivalent to about 90\% of total electricity demand, which can be used to decarbonize transport and industry. GSR could therefore become a key enabling technology for a decarbonization effort led by wind and solar power.}, language = {en} } @article{KhannaBaiocchiCallaghanetal., author = {Khanna, Tarun and Baiocchi, Giovanni and Callaghan, Max and Creutzig, Felix and Guias, Horia and Haddaway, Neal R. and Hirth, Lion and Javaid, Aneeque and Koch, Nicolas and Laukemper, Sonja and L{\"o}schel, Andreas and del Mar Zamora Dominguez, Maria and Minx, Jan C.}, title = {A multi-country meta-analysis on the role of behavioural change in reducing energy consumption and CO2 emissions in residential buildings}, series = {Nature Energy}, volume = {6}, journal = {Nature Energy}, doi = {10.1038/s41560-021-00866-x}, pages = {925 -- 932}, abstract = {Despite the importance of evaluating all mitigation options to inform policy decisions addressing climate change, a comprehensive analysis of household-scale interventions and their emissions reduction potential is missing. Here, we address this gap for interventions aimed at changing individual households' use of existing equipment, such as monetary incentives or feedback. We have performed a machine learning-assisted systematic review and meta-analysis to comparatively assess the effectiveness of these interventions in reducing energy demand in residential buildings. We extracted 360 individual effect sizes from 122 studies representing trials in 25 countries. Our meta-regression confirms that both monetary and non-monetary interventions reduce the energy consumption of households, but monetary incentives, of the sizes reported in the literature, tend to show on average a more pronounced effect. Deploying the right combinations of interventions increases the overall effectiveness. We have estimated a global carbon emissions reduction potential of 0.35 GtCO2 yr-1, although deploying the most effective packages of interventions could result in greater reduction. While modest, this potential should be viewed in conjunction with the need for de-risking mitigation pathways with energy-demand reductions.}, 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} } @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} }