The Effects of Electricity Generation from Solar and Wind Energy on the Day Ahead Market-Clearing Prices and Price Volatility: The Turkish Case
The Effects of Electricity Generation from Solar and Wind Energy on the Day Ahead Market-Clearing Prices and Price Volatility: The Turkish Case

Summary/Abstract: Solar and wind generation are the primary tools to prevent climate change and high carbon emissions. Due to their intermittent generation characteristics, solar and wind power plants have a different impact on the marketclearing prices (mcp) formation compared to conventional generation sources. The paper investigates the effects of solar and wind generation on the day ahead mcp and mpc volatility in Turkey between the 2016 and 2022. To this end, several machine learning methods are used. The second-degree polynomial learner method generated the best-fitting model. We find that Dutch TTF increases mcp with a coefficient of 0.24. An increase in wind and solar generation reduces mcp. Solar generation is ineffective on mcp below a certain demand level. Wind generation reduces mcp with a 37.78 coefficient at low demand levels and a 6.55 coefficient at high demand levels. Solar generation has a price-reducing effect with 5.55 at high demand levels. Finally, Dutch TTF and wind generation increased volatility with coefficients of 0.04 and 0.69; solar generation reduced volatility with a coefficient of 0.83.

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