lynx   »   [go: up one dir, main page]
IDEAS home Printed from https://ideas.repec.org/a/sae/enejou/v41y2020i2p47-72.html
   My bibliography  Save this article

Spatial Effects of Wind Generation and Its Implication for Wind Farm Investment Decisions in New Zealand

Author

Listed:
  • Le Wen
  • Basil Sharp
  • Erwann Sbai
Abstract
Spill-over effects on electricity nodal prices associated with increased wind generation have not been examined in the literature. To examine these effects, we use spatial econometric models to estimate the direct and indirect effects of wind generation on nodal wholesale electricity prices. Spatial econometric models allow us to provide quantitative estimates of spill-over magnitudes and statistical tests for significance. Results show negative and significant effects are associated with increases in wind penetration, and the effect is stronger during peak hours and weaker during off-peak hours. Simulation results demonstrate net savings of NZ$8 million per MW of additional wind capacity installed at the CNI2 wind site. The findings provide valuable information on the evaluation of wind farm development in terms of site location, wholesale prices, and financial feasibility. Our approach also contributes to forecasting location specific wholesale electricity prices, and provides a better understanding of the implications of locating wind sites.

Suggested Citation

  • Le Wen & Basil Sharp & Erwann Sbai, 2020. "Spatial Effects of Wind Generation and Its Implication for Wind Farm Investment Decisions in New Zealand," The Energy Journal, , vol. 41(2), pages 47-72, March.
    • Handle: RePEc:sae:enejou:v:41:y:2020:i:2:p:47-72
    DOI: 10.5547/01956574.41.2.lwen
    as

    Download full text from publisher

    File URL: https://journals.sagepub.com/doi/10.5547/01956574.41.2.lwen
    Download Restriction: no
    File URL: https://libkey.io/10.5547/01956574.41.2.lwen?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Other versions of this item:

    References listed on IDEAS

    as
    1. Oliver Browne & Stephen Poletti & David Young, 2012. "Simulating market power in the New Zealand electricity market," New Zealand Economic Papers, Taylor & Francis Journals, vol. 46(1), pages 35-50, December.
    2. Sébastien Annan-Phan and Fabien A. Roques, 2018. "Market Integration and Wind Generation: An Empirical Analysis of the Impact of Wind Generation on Cross-Border Power Prices," The Energy Journal, International Association for Energy Economics, vol. 0(Number 3).
    3. Alessandra Faggian & Philip McCann, 2009. "Human capital, graduate migration and innovation in British regions," Cambridge Journal of Economics, Cambridge Political Economy Society, vol. 33(2), pages 317-333, March.
    4. Harris, Richard D. F. & Tzavalis, Elias, 1999. "Inference for unit roots in dynamic panels where the time dimension is fixed," Journal of Econometrics, Elsevier, vol. 91(2), pages 201-226, August.
    5. Suomalainen, Kiti & Pritchard, Geoffrey & Sharp, Basil & Yuan, Ziqi & Zakeri, Golbon, 2015. "Correlation analysis on wind and hydro resources with electricity demand and prices in New Zealand," Applied Energy, Elsevier, vol. 137(C), pages 445-462.
    6. Mason, I.G. & Page, S.C. & Williamson, A.G., 2010. "A 100% renewable electricity generation system for New Zealand utilising hydro, wind, geothermal and biomass resources," Energy Policy, Elsevier, vol. 38(8), pages 3973-3984, August.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Wen, Le & Guang, Fengtao & Sharp, Basil, 2021. "Dynamics in Aotearoa New Zealand’s energy consumption between 2006/2007 and 2012/2013," Energy, Elsevier, vol. 225(C).
    2. Yi, Ming & Liu, Yafen & Sheng, Mingyue Selena & Wen, Le, 2022. "Effects of digital economy on carbon emission reduction: New evidence from China," Energy Policy, Elsevier, vol. 171(C).
    3. Ajanaku, Bolarinwa A. & Collins, Alan R., 2024. "“Comparing merit order effects of wind penetration across wholesale electricity markets”," Renewable Energy, Elsevier, vol. 226(C).
    4. Mohapatra, Souryabrata & Wen, Le & Sharp, Basil & Sahoo, Dukhabandhu, 2024. "Unveiling the spatial dynamics of climate impact on rice yield in India," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 922-945.
    5. Wen, Le & Suomalainen, Kiti & Sharp, Basil & Yi, Ming & Sheng, Mingyue Selena, 2022. "Impact of wind-hydro dynamics on electricity price: A seasonal spatial econometric analysis," Energy, Elsevier, vol. 238(PC).
    6. Wen, Le & Sheng, Mingyue Selena & Sharp, Basil & Meng, Tongyu & Du, Bo & Yi, Ming & Suomalainen, Kiti & Gkritza, Konstantina, 2023. "Exploration of the nexus between solar potential and electric vehicle uptake: A case study of Auckland, New Zealand," Energy Policy, Elsevier, vol. 173(C).
    7. De Siano, Rita & Sapio, Alessandro, 2022. "Spatial merit order effects of renewables in the Italian power exchange," Energy Economics, Elsevier, vol. 108(C).
    8. Suomalainen, Kiti & Wen, Le & Sheng, Mingyue Selena & Sharp, Basil, 2022. "Climate change impact on the cost of decarbonisation in a hydro-based power system," Energy, Elsevier, vol. 246(C).
    9. Guang, Fengtao & Wen, Le & Sharp, Basil, 2022. "Energy efficiency improvements and industry transition: An analysis of China's electricity consumption," Energy, Elsevier, vol. 244(PA).
    10. Lai, Chunyang & Kazemtabrizi, Behzad, 2024. "A novel data-driven tighten-constraint method for wind-hydro hybrid power system to improve day-ahead plan performance in real-time operation," Applied Energy, Elsevier, vol. 371(C).
    11. Yang Yi & Le Wen & Shan He, 2022. "Partitioning for “Common but Differentiated” Precise Air Pollution Governance: A Combined Machine Learning and Spatial Econometric Approach," Energies, MDPI, vol. 15(9), pages 1-23, May.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wen, Le & Suomalainen, Kiti & Sharp, Basil & Yi, Ming & Sheng, Mingyue Selena, 2022. "Impact of wind-hydro dynamics on electricity price: A seasonal spatial econometric analysis," Energy, Elsevier, vol. 238(PC).
    2. Engeland, Kolbjørn & Borga, Marco & Creutin, Jean-Dominique & François, Baptiste & Ramos, Maria-Helena & Vidal, Jean-Philippe, 2017. "Space-time variability of climate variables and intermittent renewable electricity production – A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 79(C), pages 600-617.
    3. Gholami, Mina Bahrami & Poletti, Stephen & Staffell, Iain, 2021. "Wind, rain, fire and sun: Towards zero carbon electricity for New Zealand," Energy Policy, Elsevier, vol. 150(C).
    4. Bruinshoofd Allard & Kool Clemens, 2002. "The Determinants of Corporate Liquidity in the Netherlands," Research Memorandum 014, Maastricht University, Maastricht Research School of Economics of Technology and Organization (METEOR).
    5. Kolawole Ogundari & Shoichi Ito & Victor O Okoruwa, 2016. "Estimating nutrition-income elasticities in sub-Saharan Africa: implications on health," Journal of Economic Studies, Emerald Group Publishing Limited, vol. 43(1), pages 59-69, January.
    6. Guglielmo Maria Caporale & Anamaria Diana Sova & Robert Sova, 2024. "The Covid‐19 pandemic and European trade flows: Evidence from a dynamic panel model," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 29(3), pages 2563-2580, July.
    7. George Halkos & Iacovos Psarianos, 2016. "Exploring the effect of including the environment in the neoclassical growth model," Environmental Economics and Policy Studies, Springer;Society for Environmental Economics and Policy Studies - SEEPS, vol. 18(3), pages 339-358, July.
    8. M. Shahe Emran & Dilip Mookherjee & Forhad Shilpi & M. Helal Uddin, 2021. "Credit Rationing and Pass-Through in Supply Chains: Theory and Evidence from Bangladesh," American Economic Journal: Applied Economics, American Economic Association, vol. 13(3), pages 202-236, July.
    9. Andros Gregoriou, 2010. "Corporate Valuation and Dividends: UK Evidence from Panel Unit Root and Cointegration Tests," Atlantic Economic Journal, Springer;International Atlantic Economic Society, vol. 38(1), pages 15-22, March.
    10. Na Zhang & Jinqian Deng & Fayyaz Ahmad & Muhammad Umar Draz & Nabila Abid, 2023. "The dynamic association between public environmental demands, government environmental governance, and green technology innovation in China: evidence from panel VAR model," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(9), pages 9851-9875, September.
    11. Oscar Bajo-Rubio & Carmen Diaz-Roldan, 2005. "Optimal endowments of public capital: An empirical analysis for the Spanish regions," Regional Studies, Taylor & Francis Journals, vol. 39(3), pages 297-304.
    12. In Choi, 2019. "Unit Root Tests for Dependent Micropanels," The Japanese Economic Review, Springer, vol. 70(2), pages 145-167, June.
    13. Jaewon Lim & Changkeun Lee & Euijune Kim, 2015. "Contributions of human capital investment policy to regional economic growth: an interregional CGE model approach," The Annals of Regional Science, Springer;Western Regional Science Association, vol. 55(2), pages 269-287, December.
    14. Nagmi Moftah Aimer, 2020. "Renewable energy consumption, financial development and economic growth: Evidence from panel data for the Middle East and North African countries," Economics Bulletin, AccessEcon, vol. 40(3), pages 2058-2072.
    15. Barbara Dańska-Borsiak, 2012. "Konwergencja wojewódzkich wartości TFP. Zastosowanie panelowych testów pierwiastków jednostkowych," Collegium of Economic Analysis Annals, Warsaw School of Economics, Collegium of Economic Analysis, issue 26, pages 73-85.
    16. Nagayasu, Jun, 2012. "The threshold consumption correlation-based approach to international capital mobility: Evidence from advanced and developing countries," Structural Change and Economic Dynamics, Elsevier, vol. 23(3), pages 256-263.
    17. Simplice A. Asongu & Joseph Nnanna & Paul N. Acha-Anyi, 2021. "The Openness Hypothesis in the Context of Economic Development in Sub-Saharan Africa: The Moderating Role of Trade Dynamics on FDI," The International Trade Journal, Taylor & Francis Journals, vol. 35(4), pages 336-359, July.
    18. Shirizadeh, Behrang & Quirion, Philippe, 2022. "The importance of renewable gas in achieving carbon-neutrality: Insights from an energy system optimization model," Energy, Elsevier, vol. 255(C).
    19. Uk Heo & Min Ye, 2016. "Defense Spending and Economic Growth around the Globe: The Direct and Indirect Link," International Interactions, Taylor & Francis Journals, vol. 42(5), pages 774-796, October.
    20. Jan Hoffmann & Naima Saeed & Sigbjørn Sødal, 2020. "Liner shipping bilateral connectivity and its impact on South Africa’s bilateral trade flows," Maritime Economics & Logistics, Palgrave Macmillan;International Association of Maritime Economists (IAME), vol. 22(3), pages 473-499, September.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    JEL classification:

    • F0 - International Economics - - General

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sae:enejou:v:41:y:2020:i:2:p:47-72. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: SAGE Publications (email available below). General contact details of provider: .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.
    Лучший частный хостинг