Risky Power: Choice of technology, security of supply, and market power in power markets

This project explores the interaction between risky supply, stochastic demand and the organisation of power markets and how these combine to determine the risk to supply security and adequacy – the risk of a blackout.

 
This project deals with the mix of generation technologies, the level of generation capacities, and security of supply in power markets. Risk enters at several levels. Demand for power is stochastic – but so is supply – and hence the risk of a blackout is real. Some generation technologies have a more intermittent nature than others: Energy produced by wind mills is fed into the transmission systems more randomly than power produced by traditional fuels. Thus, the mix of technologies affects the security of supply and the need to invest in reserve capacity. As power markets have been liberalised, decisions to invest in capacity have been decentralised and are now partly or wholly at the discretion of commercial companies. Their incentives to invest in generation capacities depend on market prices. How well markets work, depends on how they are organised and regulated.

This research project is financed by the Danish Social Sciences Research Council with a grant of DKK 4,5 million (approximately EUR 600,000) and by Copenhagen Business School.

Read more about "Risky Power" at the project's web-site

 

Page updated  by   19.04.2010


Poul Erik Morthorst
Professor
Systems Analysis (SYS)
Dir tel+45 46775106