Impact of renewable energy generation on power reserve energy demand

Abstract

With increasing shares of renewable energy generation, the evolution of reserve needs may represent an important challenge for the power system. The evolution of reserve capacity needs in this context has been extensively studied in the literature (Hirth and Ziegenhagen, 2015). On the other hand, reserve energy needs have been less studied. This work focuses on analysing the relationship between reserve energy demand and load, wind, and solar generation. To this end, autoregressive models with exogenous variables are estimated on 2019 data of the French power system. We find a positive impact of renewable energy generation on downward reserve energy demand and a negative impact on upward reserve energy demand. These results can be interpreted through the relationship between the level of residual load and the probability to find a counterpart on the intraday market to balance forecast errors, thus allowing to reduce the imbalance of the system in real-time and thus the need for reserve energy.

Laureen Deman, Quentin Boucher.

Published in December 2023 – Energy Economics