The effect of introducing negative prices in HUPX on the Hungarian electricity system and security of supplyUploaded: 1 of September, 2011

The market integration process demands the harmonization of rules in many fields of the electricity market. It is a question whether the introduction of negative prices to the stock exchanges is necessary or not, whether is it beneficial or not. In the face of the Czech-Slovak-Hungarian market coupling Hungary also has to consider this issue. The study intends to contribute to this discussion.

In the first part we analyse the international background and the pros and cons of negative prices, complemented with country case studies where the negative prices have already been implemented.

The second part analyses the possible effects of introducing negative prices in Hungary in a regional context: the past years’ hours with negative and minimum prices, the effect of the method of market-coupling, and the flexibility of the electricity markets of the countries in the region.

Lastly we analyse those segments of the electricity market which could be effected by the introduction of negative prices.

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