Impact of Hydroelectric Power Plants on the Electricity Market and Stability of the Electrical System
Adelino J. C. Pereira(1,2,3), R. M. Monteiro Pereira(1,2,3) 1. Polytechnic University of Coimbra, Coimbra, Portugal 2. SUScita - Research Group on Sustainability, Cities and Urban Intelligence, Polytechnic University of Coimbra, Coimbra Institute of Engineering, Coimbra, Portugal 3. INESC Coimbra - Instituto de Engenharia de Sistemas e Computadores de Coimbra, Portugal. 2026-02-15

Abstract

Hydroelectric power plants are an extremely important part of the electricity market and one of the most reliable sources of renewable energy. The demand for electricity has gone up and so will the requirement of efficient and sustainable electricity generation. The role of hydroelectric power plants on the electricity market is in their contribution to a steady and stable supply of electricity which can reduce the intermittency of solar and wind power which is another renewable energy source. With the increasing integration of renewable energy sources, future energy systems will necessitate enhanced mechanisms for balancing supply and demand. The variability of renewable energy is leading to challenges in providing a stable and continuous supply of electricity to end users, as well as maintaining grid stability. This study evaluates the influence of hydroelectric plants on price dynamics in the Iberian Electricity Market (MIBEL). Furthermore, it examines their role in integrating renewable energy sources, enhancing system flexibility during periods of significant fluctuations in wind and solar power generation.

Key words: Hydroelectric Power Plants, Pumped-Storage Hydropower, Renewable Energy, Electricity Market, Ancillary Services, Power Systems Stability.

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