Economics of intermittent renewable energy sources: four essays on large-scale integration into European power systems

This thesis centres on issues of economic efficiency originating from the large-scale development of intermittent renewable energy sources (RES) in Europe. The flexible resources that are necessary to cope with their specificities (variability, low-predictability, site specificity) are already known, but adequate signals are required to foster efficient operation and investment in these resources. A first question is to what extent intermittent RES can remain out of the market at times when they are the main driver of investment and operation in power systems. A second question is whether the current market design is adapted to their specificities. These two questions are tackled in four distinct contributions.The first chapter is a critical literature review. This analysis introduces and confronts two (often implicit) paradigms for RES integration. It then identifies and discusses a set of evolutions required to develop a market design adapted to the large-scale development of RES, such as new definitions of the products exchanged and reorganisation of the sequence of electricity markets.In the second chapter, an analytical model is used to assess the potential of intra-day markets as a flexibility provider to intermittent RES with low production predictability. This study highlights and demonstrates how the potential of intra-day markets is heavily dependent on the evolution of the forecast errors.The third chapter focuses on the benefits of curtailing the production by intermittent RES, as a tool to smooth out their variability and reduce overall generation costs. Another analytical model is employed to anatomise the relationship between these benefits and a set of pivotal parameters. Special attention is also paid to the allocation of these benefits between the different stakeholders.In the fourth chapter, a numerical simulation is used to evaluate the ability of the European transmission system operators to tackle the investment wave required in order to manage the production of intermittent RES. Alternative financing strategies are then assessed. The findings reveal that under the current trend of tariffs, the volumes of investment forecasted will be highly challenging for transmission system operators. (author)