5 ms·
Because markets, as currently implemented for energy in EU, do not adequately include things like intermittency of demand. If you take a source that has very l
by p_l 1y ago
Because markets, as currently implemented for energy in EU, do not adequately include things like intermittency of demand.
If you take a source that has very low per-MWh price but very intermittent, it gets effectively highly prioritized and everyone else is paying price to match up with this wrecking ball. Except, usually, gas turbines which slot very very nicely into the swings in capacity related to wind and solar and thus benefit from them.
- bryanlarsen 1y agoThat's true for the UK and Spain as of 2023[1], but the other major energy markets in the EU incorporate significant capacity mechanisms in their pricing. Edit: Spain added one in Feb 2025. Haven't looked up the UK yet. 1: https://www.eurelectric.org/in-detail/capacity-mechanisms/ https://www.eurelectric.org/in-detail/capacity-mechanisms/
- Y-bar 1y agoThat's not true in Scandinavia (can't speak for EU as a whole). For example Nord Pool's market structure and pricing mechanisms are specifically designed to account for the intermittency of production and demand: https://www.nordpoolgroup.com/en/the-power-market/Intraday-market/ https://www.nordpoolgroup.com/en/the-power-market/Intraday-m...