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Project information

Strategic network and generation expansion planning under uncertainty in the electricity market

S. Wogrin I.C. González-Romero T. Gómez E. Centeno D.A. Tejada J.J. Valentín Vírseda

December 2016 - December 2020

Funding entity Ministerio de Economía, Industria y Competitividad


In an effort to mitigate climate change and to achieve a sustainable supply of energy, the Programa Estatal de Investigación, Desarrollo e Innovación Orientada a los Retos de la Sociedad – and in particular the Plan Estatal de Investigación Científica y Técnica y de Innovación 2013-2016 – seeks to promote research and development (R&D) of renewable energy (RE) technologies and to foster their adoption by the market. The challenge to obtain “safe, efficient and clean energy”, declared by the Estrategia Española de Ciencia y Tecnología y de Innovación, is also in line with the the EU’s Strategic Energy Technology Plan (SET-Plan). Indeed, given the deregulation of energy sectors, i.e., both electricity and natural gas, in most EU member states, power companies would adopt RE technologies only if they contributed to their profit-maximising incentives. Furthermore, since RE technologies like wind and solar power are typically intermittent and uncertain in their output and geographically dispersed, their viability will depend on integration with the existing transmission network. However, grid-expansion decisions are taken by separate entities with differing and even conflicting objectives, i.e., welfare-maximising regulated transmission system operators (TSOs). Most policy-enabling models of the EU energy system overlook these intricacies and are based on assumptions of either perfect competition or perfect foresight, which do not adequately reflect the current paradigm and, thus, may lead to flawed market designs. Consequently, in order for the Spanish Plan Estatal’s objectives to be achieved, policymakers and market participants alike will require an enhanced understanding of how market fundamentals and strategic behaviour interact. Towards that end, STEXEM will develop completely new models that will be better suited for the research challenge of uncovering the impact of policy measures and market designs on investment and operational decisions in deregulated industries. Moreover, STEXEM will carry out state-of-the-art analyses based on stochastic optimisation and game theory in order to provide insights on efficient market design, the sustainable integration of RE and storage technologies, and the transmission investment necessary to maintain system security.


STEXEM