We develop an analytical model to derive the competitive market equilibrium for electricity spot and reserve markets under stochastic demand and uncertain renewable electricity generation. We then derive the welfare-optimal provision of reserves. At rst-best, cost of reserve capacity is balanced...

Increasing infeed from renewable energy sources poses considerable challenges to system operators who are in charge of power system reliability. Accordingly, the frequency of network congestion and the corresponding congestion management costs have increased dramatically over the last years and...

We develop an analytical model to derive the competitive market equilibrium for electricity spot and reserve markets under stochastic demand and uncertain renewable electricity generation. We then derive the welfare-optimal provision of reserves. At rst-best, cost of reserve capacity is balanced...

Increasing infeed from renewable energy sources poses considerable challenges to system operators who are in charge of power system reliability. Accordingly, the frequency of network congestion and the corresponding congestion management costs have increased dramatically over the last years and...

Increasing infeed from renewable energy sources poses considerable challenges to system operators who are in charge of power system reliability. Accordingly, the frequency of network congestion and the corresponding congestion management costs have increased dramatically over the last years and...

We develop an analytical model to derive the competitive market equilibrium for electricity spot and reserve markets under stochastic demand and uncertain renewable electricity generation. We then derive the welfare-optimal provision of reserves. At first-best, cost of reserve capacity is...

We develop a novel probabilistic methodology for consistently assessing system adequacy within an interconnected region. Relevant stochastic quantities, such as load and generation from wind and PV, are characterized by the help of quantile regressions and copulas. Based on this...