Assessing Socioeconomic Impacts of Integrating Distributed Energy Resources in Electricity Markets through Input-Output Models

Abstract

In competitive electricity markets, the growth of electricity generated by renewable sources will reduce the market price of electricity assuming marginal cost pricing. However, small renewable distributed generation (RDG) alone cannot modify the formation of electricity prices. By aggregating small RDG units into a Virtual Power Plants (as a single unit market) they are capable of dealing at the wholesale electricity market analogous to large-scale producer following in changes in wholesale prices. This paper investigates the socioeconomic impacts of different type of RDG technologies on Spanish economic sectors and households. To this end, we applied an input-output price model to detail the activities more sensitive to changes in electricity price due to RDG technologies deployment and the associated modifications in income and total output associated with the households’ consumption variation. Detailed Spanish electricity generation disaggregation of the latest available Spanish Input-Output table, which refers to 2015, was considered. It was found that the integration of RDG units in the electricity market project a better situation for the economy and Spanish households. This paper’s scope and information can be used to benefit decision-making with respect to electricity pricing policies.

Whether it is economical to use combined heat and power (CHP) system for the efficient utilization of associated petroleum gas in oil extraction sites in China: A cost-benefit analysis considering environmental benefits

“…This research's model still has limitations. Considering the wide distribution and a large number of oil extraction sites in the entire oilfield area, if the number of sites using combined heat and power is large enough, the economy of scale will be formed (Carvajal et al, 2019), which makes the model in this research need to be revised. Moreover, when the site's heat and power needs are met, there is still a lot of associated petroleum gas left over (Valentin et al, 2020).…”

Impactos urbanos de la pandemia: el fenómeno de la dispersión urbana y sus consecuencias. El caso de Madrid

“…Todo esto ha permitido diversas contribuciones desde distintos puntos de vista, como es el caso de Lenzen et al (2003), que evalúan los impactos medioambientales usando input-output, o Wiedmann et al (2007), donde se analiza el impacto medioambiental de actividades de consumo regional. Otros estudios previos también han analizado el sistema eléctrico español utilizando el modelo input-output, como Duarte et al (2017), donde los autores desagregan el sector eléctrico en una tabla input-output para España (Ramos Carvajal et al, 2019 ), donde se analizan impactos socioeconómicos de cambios en el sector usando input-output, o , donde se analizan renovables de pequeña escala.…”

Beyond the Energy System: Modeling Frameworks Depicting Distributional Impacts for Interdisciplinary Policy Analysis

“…[ 65 ] To address this issue, Miyazawa [ 66 ] developed an extension to the IOM by introducing an inter‐relational multiplier which computes how direct changes in income of one group results in indirect and induced income changes in another. [ 67 ]…”

“…Zhang et al [ 64 ] use an IOM with hybrid units and different income groups to investigate the effects of a CO 2 tax on the Chinese economy and the results indicate that while this instrument is successful on reducing emissions with little impact to GDP, the effect on households is regressive and the most affected group are low‐income rural households. Ramos Carvajal et al [ 67 ] also uses the Miyazawa model to analyze the expansion of renewable distributed generation of electricity in Spain and suggests that increasing wind and solar electricity generation has the potential to decrease electricity prices and generate a positive impact on households’ income.…”

“…[65] To address this issue, Miyazawa [66] developed an extension to the IOM by introducing an inter-relational multiplier which computes how direct changes in income of one group results in indirect and induced income changes in another. [67] Recent applications of IOMs go beyond the monetary framework and include physical units to better portray the energy and environmental systems. Zhang et al [64] use an IOM with hybrid units and different income groups to investigate the effects of a CO 2 tax on the Chinese economy and the results indicate that while this instrument is successful on reducing emissions with little impact to GDP, the effect on households is regressive and the most affected group are low-income rural households.…”