Abstract:

Our paper analyzes the sustainability and competitiveness issues at the wholesale electricity markets using an example of combined heat and power (CHP) plants. We employ the parameter of the cost of electricity production under the conditions of competitive pricing at the wholesale energy market, and in its electricity sector and make our calculations for the day-ahead market. Using the suggested methodology of cost assigning and of assessment of the energy products cost, we assess the cost of electricity production for CHP plants, as well as for the operation in the cogeneration and the condensation modes. Our results demonstrate that a CHP plant drops out of the zone of acceptable prices in the trade schedule of the day ahead-market, when operating in the condensation mode. Therefore, in too many ways, the efficiency of a CHP is determined by the ratio of electricity generation (as well as the cogeneration and condensation modes) within the calculated period. Our results might contribute to the debate on the reforms needed at the electricity markets in Europe and worldwide.