Marginal Emission Factors in Power Systems: The Case of the Netherlands

The Marginal Emission Factor (MEF) is a consistent metric with increased accuracy, compared to the average emission factor, to evaluate the avoided emissions as a result of changes in electricity consumption caused by new technologies and policies. In this study, a method is developed to model MEFs by constructing merit order profiles in interconnected power systems. The proposed method is applied in a case study of the Netherlands for the years 2018 to 2022. This method, in contrast to previous studies that developed marginal emission profiles, does not neglect the share of the electricity demand which is met by countries in neighboring bidding zones. In this study, the results suggest that ignoring electricity trading significantly underestimates the marginal emission factors. It is found that the key factors resulting in clear temporal shifts in the marginal emission profiles are fuel and CO₂ prices. Even though the installed capacity of fossil-fueled electricity generation has declined over time, these are mainly the power plants that operate at the margin and often set electricity prices at the wholesale level. Overall, the MEF profiles obtained using the proposed method could be readily employed in detailed evaluations of the emission optimization of distributed power systems to support decarbonization.