Price of Electricity and Its Influencing Factors

2017
Antans Sauļus Sauhats, Kārlis Baltputnis, Zane Broka

Research tasks: • identify the factors influencing formation of electricity price in Latvia; • perform modelling of the electricity market price within the Latvian bidding area of Nord Pool power exchange until 2030; • evaluate possibilities of reducing the capacity payments currently awarded to cogeneration power plants with installed capacity of more than 100 MW (namely Riga TEC-1,2). Results of the research: • to quantify the role of the large cogeneration power plants in the day-ahead electricity market, long-term modelling has been carried out up to 2030; different amounts of capacity payments for the power plants have been evaluated in respect to the current subsidies; • hourly generation profiles for different types of power plants, including Riga TEC, have been determined with respect to the day-ahead market price; • modelling results allow evaluating the prospective influence of support reduction on the financial indicators of Riga TEC power plants. E.g. were the payments reduced up to 50% or 25% of the current award, it would significantly deteriorate the profitability of Riga TEC, whereas lesser reduction to 75% would lead to negative profitability for a few years only with positive cash-flow from 2018 or 2022 (depending on the modelling assumptions); • forecasts of electricity price and natural gas prices for the Northern countries imply beneficial market conditions for operation of natural gas combined heat and power plants in the upcoming years.

Keywords
elektroenerģijas cena; jaudas maksājums; termoelektrostacija
Hyperlink
https://www.em.gov.lv/files/attachments/Elektroenergijas_cenu_petijuma_nosleguma_zinojums_2017-05-31.pdf

Sauhats, A., Baltputnis, K., Broka, Z. Price of Electricity and Its Influencing Factors [online]. Rīgas Tehniskā universitāte, 2017. Available from: https://www.em.gov.lv/files/attachments/Elektroenergijas_cenu_petijuma_nosleguma_zinojums_2017-05-31.pdf.

Publication language
Latvian (lv)