Early nuclear retirements in deregulated U.S. markets: Causes, implications and policy options

Haratyk, Geoffrey

doi:10.1016/j.enpol.2017.08.023

Cited by 31 publications

(26 citation statements)

References 10 publications

Supporting

Mentioning

Contrasting

Order By: Relevance

“…Trends, 2006Trends, -2016 (2) Retirements and Additions: There have been significant retirements of thermal generation assets in recent years (Figure 2), driven by a variety of market, policy, and plant-specific factors (DOE 2017). Perhaps most importantly, following natural gas prices, average annual wholesale electricity prices have declined, reducing the revenue of more-inflexible generation units (BNEF 2017;Hartman 2017;Houser, Bordoff, and Marsters 2017;Chang et al 2017;Hibbard, Tierney, and Franklin 2017;Jenkins 2017;DOE 2017;Linn and McCormack 2017;Burtraw et al 2012;Haratyk 2017); more-flexible dispatchable units, meanwhile, are in a better position to withstand average price declines as they can avoid operating when prices are below operating costs. 2 Additionally, new power plants may offer advanced 6 technologies that enable improved heat rates, lower operating costs, lower emissions, and/or increased flexibility in operations, putting pressure on the economic position of older and smaller plants that use less-advanced technology EIA 2016;DOE 2017).…”

Section: Executive Summarymentioning

confidence: 99%

Impacts of Variable Renewable Energy on Bulk Power System Assets, Pricing, and Costs

Wiser

Mills

Seel

et al. 2017

View full text Add to dashboard Cite

and Patrick Brown (MIT). Of course, any omissions or errors that remain are solely the responsibility of the authors. penetrations increase, but sometimes come at a cost to the consumer that is not always accounted for in generation portfolio decision-making. (see Chapters 2 and 5) All generation types are unique in some respect-bringing benefits and challenges to the power system-and wholesale markets, industry investments, and operational procedures have evolved over time to manage the characteristics of a changing generation fleet. With increased VRE penetrations, power system planners, operators, regulators, and policymakers will continue to be challenged to develop methods to smoothly and cost-effectively manage the reliable integration of these new and growing sources of electricity supply. Less-liquid bilateral markets exist outside of ISO/RTO regions. Note also that substantial amounts of generation even in ISO/RTO regions are locked-into longer-term physical or financial contracts, in which case available wholesale market prices signal opportunity costs but may not affect immediate revenue generation for those existing generators; wholesale pricing will, of course, still affect market entry decisions for new generation. 2 Where active wholesale markets do not exist, the same basic dynamics hold: the declining cost of natural gas, for example, puts economic pressure on inflexible units even in markets that do not feature an ISO/RTO.

show abstract

Section: Executive Summarymentioning

confidence: 99%

Impacts of Variable Renewable Energy on Bulk Power System Assets, Pricing, and Costs

Wiser

Mills

Seel

et al. 2017

View full text Add to dashboard Cite

show abstract

“…Several studies have used historical observations or simple models to estimate the impact of VRE on wholesale prices for different regions of the U.S. [45][46][47][48][49][50][51][52], summarized in Table 3. For most studies, we report the effect of VRE as the decrease in the average RT wholesale price with the average amount of VRE over the study period, relative to the average price without the VRE;…”

Section: Impacts On Average Annual Historical Wholesale Electricity Pmentioning

confidence: 99%

“…they represent regions with among the highest shares of VRE, and (2) as single-state ISOs, they are relatively easier to model than multi-state markets.The simple fundamental model uses a merit-order supply curve based on individual generator capacity and marginal costs along with hourly observed demand and VRE production to estimate hourly prices. Following generally similar approaches used to explain the decrease in wholesale prices in Germany[56][57][58] 6 as well as in the Midwest and Mid-Atlantic[52], we isolate the impact of each individual factor on the decline in wholesale prices by holding all factors from 2016 fixed except for one that is changed from its 2016 value to its 2008 value. For example, we estimate the impact of growing amounts of renewable energy by changing the renewable electricity supply from its 2016 value to its 2008 value, while keeping other factors constant at their 2016 levels.…”

mentioning

confidence: 99%

“…Growth of wind in MISO and PJM was found to have a much smaller effect of ~$1-2.5/MWh (2-5% reduction). Haratyk[52], meanwhile, estimates the drivers for wholesale price reductions from 2008 to 2015 in the Midwest and Mid-Atlantic regions, finding that natural gas price declines and load reductions were the two dominant drivers with growth in wind playing a relatively smaller role.29ERCOT CAISONote: 2016 used as the base year.…”

mentioning

confidence: 99%

See 1 more Smart Citation

Impacts of variable renewable energy on wholesale markets and generating assets in the United States: A review of expectations and evidence

Mills

Levin

Wiser

et al. 2020

Renewable and Sustainable Energy Reviews

View full text Add to dashboard Cite

We synthesize available literature, data, and analysis on the degree to which growth in variable renewable energy (VRE) has impacted or might in the future impact bulk power system assets, pricing, and costs in the United States. Most studies of future scenarios indicate that VRE reduces wholesale energy prices and capacity factors of thermal generators. Traditional baseload generators are more exposed to these changing market conditions than low-capital cost and more flexible intermediate and peak-load generators. From analysis of historical data we find that VRE is already influencing the bulk power market through changes in temporal and geographic patterns areas with higher levels of VRE. The most significant observed impacts have concentrated in areas with significant VRE and/or nuclear generation along with limited transmission, with negative pricing also often occurring during periods with lower system-wide load. So far, however, VRE, has had a relatively modest impact on historical average annual wholesale prices across entire market regions, at least in comparison to other drivers. The reduction of natural gas prices is the primary contributor to the decline in wholesale prices since 2008. Similarly, VRE impacts on thermal plant retirements have been limited and there is little relationship between the location of recent retirements and VRE penetration levels. Although impacts on wholesale prices have been modest so far, impacts of VRE on the electricity market will be more significant under higher VRE penetrations. KEYWORDSVariable renewable energy; electricity markets; electricity prices; generator profitability 3 ABBREVIATIONS AS Ancillary services CAISO California Independent System Operator CCGT Combined cycle gas turbine CREZ Competitive Renewable Energy Zones CT Combustion turbine DOE

show abstract

“…Table 9 breaks down the bins and shows total capacity in each case. These bins are categorizations that reflect the current discussion pointing to more economic pressure on restructured and single-reactor units (Haratyk 2017;Steckler 2017). Table 10).…”

Section: Retirementsmentioning

confidence: 99%

Regional Energy Deployment System (ReEDS) Model Documentation: Version 2018

Cohen

Becker

Bielen

et al. 2019

View full text Add to dashboard Cite

AcknowledgmentsWe gratefully acknowledge the many people whose efforts contributed to this report. The ReEDS modeling and analysis team at the National Renewable Energy Laboratory (NREL) was active in developing and testing the ReEDS model v.2018. We also acknowledge the vast number of current and past NREL employees on and beyond the ReEDS team who have participated in data and model development, testing, and analysis. We are especially grateful to Walter Short who first envisioned and developed the Wind Deployment System (WinDS) and ReEDS models. We thank for their comments and improvements on successive versions of this report. Finally, we are grateful to all those who helped sponsor ReEDS model development and analysis, particularly supporters from the U.S. Department of Energy (DOE) but also others who have funded our work over the years.

show abstract

Early nuclear retirements in deregulated U.S. markets: Causes, implications and policy options

Cited by 31 publications

References 10 publications

Impacts of Variable Renewable Energy on Bulk Power System Assets, Pricing, and Costs

Impacts of Variable Renewable Energy on Bulk Power System Assets, Pricing, and Costs

Impacts of variable renewable energy on wholesale markets and generating assets in the United States: A review of expectations and evidence

Regional Energy Deployment System (ReEDS) Model Documentation: Version 2018

Contact Info

Product

Resources

About