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Centre for Energy Economics Research

Faculteit Economie en Bedrijfskunde
Centre for Energy Economics Research
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NWO project "Redesigning the Electricity Market to Foster Renewable Energy"

Datum:06 oktober 2015

As a result of the increase of renewable energy sources, the electricity market is changing in many perspectives. A multidisciplinary team of researchers will analyze the consequences of a number of alternative options to redesign the electricity market to facilitate the transition towards a sustainable energy system.

The objective of the research project is to give insights in the technical, economic and societal impact of the growth in renewable energy given the current as well as alternative designs of the electricity market.

For the funding of this research the Dutch scientific research council (NWO) has granted a research fund to facilitate the project. The project will last until the summer of 2016 and has a strict timeline in order to contribute to the current debate about the transition towards a sustainable energy system. 

Detailed information:

As a result of national policies to stimulate renewable energy sources (RES), the share of RES in the energy mix is growing strongly in most European countries and will continue to do so in the coming years. This increase of RES has many consequences for different elements of the electricity market. The objective of the RES-EM project is to give insights in the technical, economic and societal impacts of the growth in renewable energy given the current as well as alternative designs of the electricity market. By electricity market design, we mean all relevant institutional aspects. This research will pay attention to the regulation of networks, the way wholesale and retail markets are organized, the instruments used to foster renewable energy as well as the integration of the energy system.

Several research fields are needed to study the overall effects of an alternative electricity market designs against this background. Economic effects include the efficiency of electricity supply and the incentives for investments. The technical issues concern the reliability of the grid. Societal questions include the acceptance of differences in commodity prices, access tariffs or energy taxes during different time periods, among regions, or groups of energy users.

The research team consists of academic workers from different faculties of the University of Groningen. The research group consists of four postdocs, supervised by five academic members with all many years of experience in conducting research in different sub fields in the energy sector.

One postdoc of the Faculty of Economics and Business (FEB) will develop the economic model of the electricity market. Another postdoc of the FEB will focus on empirical studies regarding the different choices made about the institutional design in several European countries. The postdoc of the Faculty of Mathematics and Natural Science will develop a model of the physical infrastructure and will work together with the postdocs from the FEB who will develop the economic model of the electricity market. The postdoc of the Faculty of Philosophy will focus on the societal issues, in particularly issues regarding the fairness and the acceptability of alternative market designs to the different stakeholders in general and the consumers in particular.

In order to facilitate the current debate a Dutch valorization board is created. Members of this board give feedback on the aim and draft results during the project. The results of the research will be valuable for the current debate, not only in the Netherlands, but also on a European level. Therefore also an international advisory board has been installed, including experts from several European countries and several types of institutions.