Please use this identifier to cite or link to this item: http://hdl.handle.net/10419/228788
Authors: 
Golub, Alexander
Govorukha, Kristina
Mayer, Philip
Rübbelke, Dirk
Year of Publication: 
2020
Series/Report no.: 
Working Paper No. 012.2020
Abstract: 
The effects of extreme weather events, such as heat waves and droughts are taken into account in both global and European policies. Accordingly, the protection of critical infrastructures and in particular, the resilience of the energy sector was the subject of intense research. There are regional differences in the degree of exposure to extreme events. In Northern Europe, their intensity has increased dramatically within a decade. In our analysis we identify emerging risks of extreme weather events, in particular, droughts and high temperatures, for the German power sector. Furthermore, we consider how European policy addressed these severe risks. Our analysis is based on extensive datasets covering temperature and drought data for the last 40 years. We find evidence of a higher frequency of power plants outages as a consequence of droughts and high temperatures. We investigate increases in the wholesale electricity price and price volatility and develop a capacity-adjusted drought index. The results are used to assess the monetary loss of power plant outages due to heatwaves and droughts. We stress that increasing frequencies of such extreme weather events will aggravate the observed problem, especially with respect to the transition of the power sector.
Subjects: 
Electricity
Energy
Energy Utilities
Gas
Hydrocarbons
Climate
Climate Change
Desertification
Drought
Global Warming
Weather
JEL: 
Q4
Q54
Document Type: 
Working Paper

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