Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/51264
Authors: 
Flinkerbusch, Kai
Heuterkes, Michael
Year of Publication: 
2009
Series/Report no.: 
CAWM discussion paper / Centrum für Angewandte Wirtschaftsforschung Münster 25
Abstract: 
This article examines potential cost reductions in the market for balancing power by pooling all four German control areas. In a united control area both the procurement and the production of balancing power may be more efficient than in four separated control areas. Our data contain published bids on energy procurement as well as balancing power flows in the period from December 2007 to November 2008. A reference scenario simulates the market results for primary and secondary balancing power, as well as minutes reserve. Subsequently, we simulate a united control area by pooling the historical bids of each control area and by netting the area imbalances. We show that in the period under review the total costs of procured and produced balancing power are reduced by 17 %. The production costs for secondary balancing power are reduced by even 45 %.
Subjects: 
Electricity
Balancing Power
Regulation
JEL: 
Q42
L1
L94
Document Type: 
Working Paper

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