The transformation of the electricity sector is a central element of the transition to a decarbonized economy. Conventional generators powered by fossil fuels have to be replaced by variable renewable energy (VRE) sources in combination with electricity storage and other options for providing temporal flexibility. We discuss the market dynamics of increasing VRE penetration and its integration in the electricity system. We describe the merit-order effect (the decline of wholesale electricity prices as VRE penetration increases) and the cannibalization effect (the decline of VRE value as its penetration increases). We further review the role of electricity storage and other flexibility options for integrating variable renewables and how storage can contribute to mitigating the two mentioned effects. We also use a stylized open-source model to provide some graphical intuition on these issues. While relatively high shares of VRE are achievable with moderate amounts of electricity storage, the role of long-duration storage increases as the VRE share approaches 100%.

中文翻译：

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可变可再生能源和电力储存的经济学

电力部门的转型是向脱碳经济转型的核心要素。由化石燃料驱动的传统发电机必须由可变可再生能源 (VRE) 资源以及电力存储和其他提供时间灵活性的选项来取代。我们讨论了增加 VRE 渗透率及其在电力系统中的整合的市场动态。我们描述了优劣顺序效应（批发电价随着 VRE 渗透率的增加而下降）和蚕食效应（VRE 值随着其渗透率的增加而下降）。我们进一步回顾了电力存储和其他灵活性选项在整合可变可再生能源方面的作用，以及存储如何有助于减轻上述两种影响。我们还使用程式化的开源模型来提供有关这些问题的一些图形直觉。虽然适度的电力存储可以实现相对较高的 VRE 份额，但随着 VRE 份额接近 100%，长期存储的作用会增加。