Effect of Wind Turbine Selection in Newly Built Wind Farms in Decentralized Electricity Markets

Abstract

As energy systems are transitioning to renewable sources of power, planning of the locations of new renewable energy generation is in an increasingly important role. A renewable power based system is characterized by intermittent supply of power, which is reflected on the day-ahead market prices of electricity. By geographically dispersing renewable power generation capacity, it is less likely that the power generation from different sites significantly overlap. By using wind power estimates based on global ERA5 weather data, it is possible to evaluate the effect of new additional wind power generation capacity in different geographical areas. By modifying day-ahead market bid curves to include newly added generation from the building of a new 100 MW wind farm, the effects of the additional wind power capacity on the day-ahead electricity prices can be quantified. This paper studies the effects of five different wind turbines, with total 100 MW of installed capacity, at different locations on the day-ahead electricity markets with focus on revenue, cannibalization of the day-ahead electricity price, and societal benefit in electricity price reduction.