Renewable energy generation efficiency and market effects in Serbian power system

The power plant generation planning is presented in this paper. The simulation combines expected overall industry costs, associated cost uncertainty and expected CO2 emission costs for different generation, variation of future fossil-fuel costs, carbon prices, plant investment costs and demand, including price elasticity impacts. The elasticity of fuel and electricity prices influences the decision making. The method applied in the paper is based on fuzzy numbers and Monte Carlo method with multitude of possible scenarios and their checking. The real case study, in the first part, comprises three ‘classical’ candidate power plants (thermal coal power plant, CCGT and ST on lignite). In the second part, the same simulation was used for ‘the renewables’, wind (WG), solar (SG) and hydro (HG) power plants. Comparing the results, decisions were made about the profitability of investments in renewable energy. It could be concluded that the proposed method is a powerful aid to renewable and non-renewable generation mix - planning. The method diversifies the generation mix features and their combinations placing them in the time prospective. The incentive to build is based on purely economic signals and on the time-value of-money principle.