The impact of weather changes on the supply and demand of electric power and wholesale prices of electricity in Germany

Kenta Tanaka, Ken’ichi Matsumoto, Alexander Ryota Keeley, Shunsuke Managi

Research output: Contribution to journalArticlepeer-review

2 Citations (Scopus)

Abstract

Weather conditions critically affect electricity demand. Recently, weather changes have also affected the electricity supply because renewable energy sources have been diffused. Some studies have revealed that weather conditions affect electricity supply or demand. However, few studies have revealed the integrated effects of weather changes on the electricity supply, demand, and market prices. This study aims to reveal the regional weather impact on the German electricity spot market based on combined hourly weather and electricity market data using structural equation modeling. Our results reveal that weather changes affect both demand and supply. First, the effect of weather on electricity supply differs in each state. Our estimation results show a more complex effect of an increase in solar radiation. Second, the electricity demand is also affected by weather conditions, particularly by temperature. Additionally, regional differences in weather conditions create a complex structure of electricity supply and demand. Our results indicate that extreme weather events in specific areas have a significant impact on the electricity market price.

Original languageEnglish
Pages (from-to)1813-1825
Number of pages13
JournalSustainability Science
Volume17
Issue number5
DOIs
Publication statusPublished - Sep 2022

All Science Journal Classification (ASJC) codes

  • Global and Planetary Change
  • Health(social science)
  • Geography, Planning and Development
  • Ecology
  • Sociology and Political Science
  • Nature and Landscape Conservation
  • Management, Monitoring, Policy and Law

Fingerprint

Dive into the research topics of 'The impact of weather changes on the supply and demand of electric power and wholesale prices of electricity in Germany'. Together they form a unique fingerprint.

Cite this