Revenue analysis of spot and forward solar energy sales in Texas
Han Qi et al.
What the paper says
Texas is the largest electricity-consuming state in the United States and leads the nation in variable renewable energy (VRE) development. It projects a huge increase in solar plant construction, despite VRE development’s “cannibalization effect†on the investment incentive for solar generation and the rising popularity of short-term VRE power purchase agreements in the United States. Our empirical investigation of short-term spot and forward solar energy sales first uses Texas’s monthly wholesale electricity market data for February 2016 to December 2021 to forecast the average daytime (07:00–19:00) spot energy prices and their standard deviations for forward-looking periods of one year, three years, five years and ten years. It then applies the price forecast results to analyze the revenue forecasts for a solar generation developer’s spot and forward energy sales, revealing that a new solar plant’s revenue forecast level (respectively, volatility) increases (respectively, decreases) with a short-term solar power purchase agreement’s forward energy price. When the forward energy price is below (respectively, above) the spot energy price forecast, the developer’s short-term power purchase agreement offer in response to a loadserving entity’s VRE procurement auction announcement is for a megawatt-fraction (respectively, 100%) of the plant’s energy output.
4 citations
Evidence weight
Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40
| F · citation impact | 0.25 × 0.4 = 0.10 |
| M · momentum | 0.60 × 0.15 = 0.09 |
| V · venue signal | 0.50 × 0.05 = 0.03 |
| R · text relevance † | 0.50 × 0.4 = 0.20 |
† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.