Energy markets in transition: essays on electricity prices, storage options and residential pv systems
File(s)
Author(s)
Nowakowska, Liliana
Type
Thesis
Abstract
The UK energy market is in a transition state, characterized by the integration of renewable energy sources and the growing potential of energy storage technologies. This thesis provides a comprehensive analysis of electricity price dynamics and explores the strategic use of storage technologies, offering novel insights into profit maximization for both energy suppliers and residential consumers.
The first study examines the UK’s wholesale electricity market, analyzing key factors driving price volatility between 2009 and 2018. Despite increased renewable energy generation, gas prices continue to dominate electricity price fluctuations, emphasizing persistent market instability. Understanding these drivers highlights investment challenges and the potential for storage to enhance resilience.
The second study focuses on profit maximization strategies for energy suppliers through lithium-ion battery deployment. The analysis reveals that storage can significantly increase retailer profitability, particularly in imperfectly competitive markets. However, high investment costs and limited profitability highlight the need to explore various market routes. This strategic approach provides valuable insights for suppliers optimizing operations and understanding storage's broader market effects.
The third study evaluates the economic viability of residential PV systems combined with Battery Energy Storage Systems (BESS). While solar panels alone offer substantial household savings, storage provides further reductions under high electricity price scenarios. However, high costs and limited lifespan often result in payback periods exceeding battery operational life, making solar-only setups a more viable option unless additional incentives exist.
In conclusion, this thesis explores the UK energy market’s transition, focusing on price volatility, storage technologies, and economic implications for stakeholders. By examining price fluctuations, energy storage for profit maximization, and the financial viability of residential solar and storage systems, this work offers practical insights into integrating renewables and storage. These studies highlight the complexities of balancing market dynamics with investment incentives, providing a foundation for informed decision-making.
The first study examines the UK’s wholesale electricity market, analyzing key factors driving price volatility between 2009 and 2018. Despite increased renewable energy generation, gas prices continue to dominate electricity price fluctuations, emphasizing persistent market instability. Understanding these drivers highlights investment challenges and the potential for storage to enhance resilience.
The second study focuses on profit maximization strategies for energy suppliers through lithium-ion battery deployment. The analysis reveals that storage can significantly increase retailer profitability, particularly in imperfectly competitive markets. However, high investment costs and limited profitability highlight the need to explore various market routes. This strategic approach provides valuable insights for suppliers optimizing operations and understanding storage's broader market effects.
The third study evaluates the economic viability of residential PV systems combined with Battery Energy Storage Systems (BESS). While solar panels alone offer substantial household savings, storage provides further reductions under high electricity price scenarios. However, high costs and limited lifespan often result in payback periods exceeding battery operational life, making solar-only setups a more viable option unless additional incentives exist.
In conclusion, this thesis explores the UK energy market’s transition, focusing on price volatility, storage technologies, and economic implications for stakeholders. By examining price fluctuations, energy storage for profit maximization, and the financial viability of residential solar and storage systems, this work offers practical insights into integrating renewables and storage. These studies highlight the complexities of balancing market dynamics with investment incentives, providing a foundation for informed decision-making.
Version
Open Access
Date Issued
2024-05-31
Date Awarded
01/04/2025
License URL
Advisor
Green, Richard
Publisher Department
Business School
Publisher Institution
Imperial College London
Qualification Level
Doctoral
Qualification Name
Doctor of Philosophy (PhD)