Three essays on the economics of renewable energy in small island economies

[摘要] In chapter 1, we introduce mechanism and present results of an integrated investment appraisal of an onshore wind farm for electricity generation in Cape-Verde that is owned and operated by a private investor. From the perspective of the electric utility and the economy, the results of such an ex-ante financial and economic appraisal of wind electricity generation depends critically on one’s view of the expected long-term level of future fossil fuel prices, negotiations of the power purchase agreement (PPA) price and wind capacity factor. In Chapter 2, we investigate the impacts of wind and solar renewable power sources on both electricity generation and planning by employing and applying a cost minimization model in Cyprus. The cost minimization model demonstrates that the use of wind alone and mix of wind and solar power in an electricity generation mix reduces the overall cost of the system. Due to high cost of electricity generation from fuel oil in Cyprus, we conclude that shift toward wind and solar mix of energy sources in Cyprus will have significant impact by means of cost reduction. Therefore, integrating these renewables will essentially contribute to the welfare of Cypriot consumers alongside its environmental and health benefits associated in them. In Chapter 3, we study the impacts of implementing real-time electricity pricing (RTP) in the Cypriot electricity market with and without wind/solar capacities. We use a merit order stack approach to generation investment and operation decisions. Empirical results show that dynamic pricing will increase generation capacity utilization by means of reduction in equilibrium installed capacity reduction and increase in load factors of off-peak plants. These savings are larger at higher demand elasticities. The emissions from electricity generation will potentially increase resulting from increased energy consumption, however. Because wind (solar) availability comes mostly during low (high) demand hours when relatively cleaner (dirtier) plants operate in the system, we find that there is considerable potential for capital cost savings and emission savings from smart metering even with only a small consumer response and at moderate participation in the programme. At the current costs of solar, investing in wind alone will however yield higher bill savings.

[发布机构] University:University of Birmingham;Department:Birmingham Business School, Department of Economics

[关键词] H Social Sciences;HC Economic History and Conditions