Modelling Investment Behaviour in the German Electricity System: The Influence of Energy System and Technology Parameters

Kurzfassung

This thesis analyses how uncertainty in energy system and technology parameters affects investment behaviour in the German electricity market. The German energy transition requires substantial private investment in renewable generation, storage and flexible capacity, while future market conditions remain uncertain. To examine this uncertainty, a meta-analysis compares selected parameters across recent German energy scenario studies. These parameters include technology costs, CO2 prices, fuel prices, electricity demand, installed generation capacity and storage capacity. The observed parameter spreads are then linked to a sensitivity analysis based on a modelling framework consisting of an agent-based investment model coupled with an agent-based electricity market model. The meta-analysis shows that scenario studies agree on the broad direction of the transition, especially increasing electrification, renewable expansion and growing flexibility needs. However, substantial differences remain in the quantitative trajectories of key parameters. These spreads are particularly relevant for investment decisions because they influence both the cost and revenue side of project profitability. The sensitivity analysis shows that parameter variations can affect investment behaviour in two ways. First, they can change the level of the net present value (NPV) and therefore the expected profitability of a technology. Second, if the baseline NPV is close to the break-even threshold, they can also change whether investment takes place at all. PV is the clearest example of this second effect, as CAPEX variations can shift its NPV above or below zero. Onshore wind and battery storage remain profitable across the tested variations. However, their NPV levels still change, especially for battery storage under natural gas price variations. Gas-fired plants remain unprofitable in the analysed set-up, even under favourable parameter variations like lower natural gas and CO2 prices. Overall, the results show that differences between energy scenario studies are not only relevant for describing alternative transformation pathways. They can affect investor-oriented profitability assessments, and in some cases, capacity expansion decisions. This highlights the importance of analysing scenario uncertainty when assessing future investment needs and the development of the German electricity system.