Long-Term Dynamics of Electricity Generation Expansion Optimal Investments for the Next 50 Years

Abstract

Sustainable development has become the foundation in planning for the future. Nowhere is it more evident than in the energy sector. Re-Conceptualization of the electricity market is currently underway. The latter being unsustainable has attracted a lot of public attention. Debates on its future vary significantly in expectations. However its transition to a fully renewable based one has gathered most of the scientific and public support. Energy Transitions exhibit complex and dynamic behavior. In order to better understand them and close the gap between desired expectations and achieved results, new electricity market models are being build and analyzed. This thesis will rely on the System Dynamics methodology to build a small model of the electricity market. The model sheds some light on the dynamics of the battle between old non-renewable technologies and new renewable ones. The core interest is in generation expansion planning and its investment strategy. Optimal strategies given the built model are determined relying on a tool called Stochastic Optimization in Policy Space (SOPS). The policies highlight the fact that most investment should be re-allocated from the non-renewable to renewable technologies from the beginning to achieve optimal results on the long run.