Does the increasing share of renewable energy lead to more “extreme” electricity prices in the Dutch imbalance market? A quantile regression analysis approach

In response tothe increasing focus on sustainable forms of electricity generation,this research investigates the effect renewable energy has on the peak electricity prices in the Dutch imbalance market. With solar and wind energy being the two primal renewable energy sources present in the Dutch energy mix, this research is limited by these two aforementioned energy sources. The period analyzed stretches between 01-01-2015 to 20-09-2019and contains a total of 16383 observations. By performing a quantile regression analysis, this research has aimed to quantify its results into three different models. Supported by existing literature, evidence is found that the increasing share of renewable energy indeed has an amplifying effect on the electricity price peaks. Hereby, this thesis contributes to policy makers, investors and entrepreneurs who are affected by, or see opportunity in, extreme energy prices.