The Economics of Variable Renewable Energy and Electricity Storage

  title={The Economics of Variable Renewable Energy and Electricity Storage},
  author={Javier L'opez Prol and Wolf-Peter Schill},
  journal={Annual Review of Resource Economics},
The transformation of the electricity sector is a central element of the transition to a decarbonized economy. Conventional generators powered by fossil fuels have to be replaced by variable renewable energy (VRE) sources in combination with electricity storage and other options for providing temporal flexibility. We discuss the market dynamics of increasing VRE penetration and its integration in the electricity system. We describe the merit-order effect (the decline of wholesale electricity… 
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