LAPSE:2023.32676v1
Published Article

LAPSE:2023.32676v1
The Effectiveness of Energy Cooperatives Operating on the Capacity Market
April 20, 2023
Abstract
The European Green Deal aims to make Europe the world’s first climate-neutral continent by 2050 by shifting to a clean circular economy, combating biodiversity loss and reducing pollution levels. In Poland, whose economy invariably remains one of the most dependent on coal consumption in Europe, institutional responses to the above EU objectives have taken the shape of energy cooperatives aimed at filling the gaps in the development of the civic dimension of energy on a local scale and the use of potential renewable energy sources in rural areas, including in relation to the agricultural sector. This article is a continuation of the authors’ previous research work, which has so far focused on the analysis of the development of profitability of Polish institutions that fit into the European idea of a “local energy community”, which includes energy cooperatives. In this research paper, they present the results of subsequent research work and analyses performed on the basis of it which, on the one hand, complement the previously developed optimization model with variables concerning actual energy storage and, on the other hand, analyze the profitability of the operation of energy cooperatives in the conditions of the “capacity market”. The latter was actually introduced in Poland at the beginning of 2021. The research took account of the characteristics of energy producers and consumers in rural areas of Poland, the legally defined rules for the operation of the capacity market and the institutional conditions for the operation of energy cooperatives that can use the potential of energy storage. A dedicated mathematical model in mixed integer programming technology was used, enriched with respect to previous research, making it possible to optimize the operation of energy cooperative with the use of actual energy storage (batteries). Conclusions from the research and simulation show that the installation of energy storage only partially minimizes the volume of energy drawn from the grid in periods when fees related to the capacity market are in force (which should be avoided due to higher costs for consumers). The analysis also indicates that a key challenge is the proper parameterization of energy storage.
The European Green Deal aims to make Europe the world’s first climate-neutral continent by 2050 by shifting to a clean circular economy, combating biodiversity loss and reducing pollution levels. In Poland, whose economy invariably remains one of the most dependent on coal consumption in Europe, institutional responses to the above EU objectives have taken the shape of energy cooperatives aimed at filling the gaps in the development of the civic dimension of energy on a local scale and the use of potential renewable energy sources in rural areas, including in relation to the agricultural sector. This article is a continuation of the authors’ previous research work, which has so far focused on the analysis of the development of profitability of Polish institutions that fit into the European idea of a “local energy community”, which includes energy cooperatives. In this research paper, they present the results of subsequent research work and analyses performed on the basis of it which, on the one hand, complement the previously developed optimization model with variables concerning actual energy storage and, on the other hand, analyze the profitability of the operation of energy cooperatives in the conditions of the “capacity market”. The latter was actually introduced in Poland at the beginning of 2021. The research took account of the characteristics of energy producers and consumers in rural areas of Poland, the legally defined rules for the operation of the capacity market and the institutional conditions for the operation of energy cooperatives that can use the potential of energy storage. A dedicated mathematical model in mixed integer programming technology was used, enriched with respect to previous research, making it possible to optimize the operation of energy cooperative with the use of actual energy storage (batteries). Conclusions from the research and simulation show that the installation of energy storage only partially minimizes the volume of energy drawn from the grid in periods when fees related to the capacity market are in force (which should be avoided due to higher costs for consumers). The analysis also indicates that a key challenge is the proper parameterization of energy storage.
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Keywords
capacity market, energy cooperatives, Energy Storage, mixed integer programming, rural areas
Suggested Citation
Jasiński J, Kozakiewicz M, Sołtysik M. The Effectiveness of Energy Cooperatives Operating on the Capacity Market. (2023). LAPSE:2023.32676v1
Author Affiliations
Jasiński J: Institute of Rural and Agricultural Development, Polish Academy of Sciences, 72 Nowy Świat St., 00-330 Warsaw, Poland [ORCID]
Kozakiewicz M: Collegium of Economic Analysis, Warsaw School of Economics, Madalińskiego 6/8 St., 02-513 Warsaw, Poland [ORCID]
Sołtysik M: Faculty of Electrical Engineering, Częstochowa University of Technology, Armii Krajowej St. 17, 42-200 Częstochowa, Poland [ORCID]
Kozakiewicz M: Collegium of Economic Analysis, Warsaw School of Economics, Madalińskiego 6/8 St., 02-513 Warsaw, Poland [ORCID]
Sołtysik M: Faculty of Electrical Engineering, Częstochowa University of Technology, Armii Krajowej St. 17, 42-200 Częstochowa, Poland [ORCID]
Journal Name
Energies
Volume
14
Issue
11
First Page
3226
Year
2021
Publication Date
2021-05-31
ISSN
1996-1073
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Original Submission
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PII: en14113226, Publication Type: Journal Article
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