Offshore wind and its effect on the Nordic power market
Martine Brenden Utgård and Elise Tomt, graduates from NHH will present their master thesis work about the economic effect of integration of offshore wind.
An increasing share of renewable energy sources, such as offshore wind power, is expected in the future power markets. Several authors have found that power prices tend to decrease and fluctuate more when integrating offshore wind. This results from the merit order effect and the intermittent nature of wind power generation.
The presentation will introduce the results from their study on how generation of offshore wind power at Sørlige Nordsjø II and Utsira Nord will impact the Nordic day-ahead market. The optimization model used assumes that both sites are connected directly to the Norwegian mainline grid in NO2 and NO5. In general, adding offshore wind results in declining power prices for all three operating hours modelled, accounting for seasonal fluctuations in water reservoir levels. Overall, the study illustrates trends of increasing price differences and price fluctuations when integrating offshore wind. However, the effects vary for the three water level scenarios with different levels of initial price convergence.
Elise Tomt and Martine Utgård are fifth year students at the Norwegian School of Economics, currently finishing their master’s degree in finance. Last fall they wrote their master’s thesis on the integration of offshore wind power in the Nordic power market. They look forward to present and discuss their findings
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