Analyzing the influence of Climate Change in Brazilian Electricity Markets

Abstract

The Brazilian Power System is mostly supplied by hydro-generation. In this context there is a strong connection between rain-fall regimes and the Electricity Prices in the short term market. This work describes the main features, developments and functioning of a System Dynamics model that simulates the four Brazilian short term electricity submarkets. Based on studies reporting the change in rainfall regimes in Brazil due to Climate Change, we analyze the impacts of these changes in each specific region and in the electricity markets as a whole. The results provide good insights on the impacts of Global Warming in the Brazilian Power System, indicating for instance that the Southeast/Center-West Electricity Submarket is the one that will be most affected by the global issue in terms of rise in the electricity prices.