<\/p>\n
In an effort to mitigate climate change and to achieve a sustainable supply of energy, the Programa Estatal de Investigaci\u00f3n, Desarrollo e Innovaci\u00f3n Orientada a los Retos de la Sociedad \u2013 and in particular the Plan Estatal de Investigaci\u00f3n Cient\u00edfica y T\u00e9cnica y de Innovaci\u00f3n 2013-2016 \u2013 seeks to promote research and development (R&D) of renewable energy (RE) technologies and to foster their adoption by the market. The challenge to obtain \u201csafe, efficient and clean energy\u201d, declared by the Estrategia Espa\u00f1ola de Ciencia y Tecnolog\u00eda y de Innovaci\u00f3n, is also in line with the the EU\u2019s Strategic Energy Technology Plan (SET-Plan). Indeed, given the deregulation of energy sectors, i.e., both electricity and natural gas, in most EU member states, power companies would adopt RE technologies only if they contributed to their profit-maximising incentives. Furthermore, since RE technologies like wind and solar power are typically intermittent and uncertain in their output and geographically dispersed, their viability will depend on integration with the existing transmission network. However, grid-expansion decisions are taken by separate entities with differing and even conflicting objectives, i.e., welfare-maximising regulated transmission system operators (TSOs).<\/p>\n
Most policy-enabling models of the EU energy system overlook these intricacies and are based on assumptions of either perfect competition or perfect foresight, which do not adequately reflect the current paradigm and, thus, may lead to flawed market designs. Consequently, in order for the Spanish Plan Estatal\u2019s objectives to be achieved, policymakers and market participants alike will require an enhanced understanding of how market fundamentals and strategic behavior interact. Towards that end, STEXEM<\/strong> will develop completely new models that will be better suited for the research challenge of uncovering the impact of policy measures and market designs on investment and operational decisions in deregulated industries. Moreover, STEXEM<\/strong> will carry out state-of-the-art analyses based on stochastic optimisation and game theory in order to provide insights on efficient market design, the sustainable integration of RE and storage technologies, and the transmission investment necessary to maintain system security.<\/p>\n