THE ELECTRICITY MARKET, EXPLAINED
What sets the price of electricity?
Change the market. See which generators run—and what everyone earns.
02 Watch the market clear
SINGLE ZONE / 1 HOURCLEARING PRICE
€79.75/ MWh
PRICE-SETTING GENERATORCombined-cycle gas60 of 60 GW served
THE MERIT ORDERCheapest generation runs first
DispatchedAvailable, unusedDemandClearing price
The last generator sets the price.
Operational emissions
g CO₂/kWh
Total operating margin
/ hour
Excludes fixed & capital costs. Not total profit.
Two scenarios. One market model.
Scenario A is a fixed snapshot. The simulator controls edit B. This is separate from the default-baseline toggle.
| Technology | A · GW | B · GW | Change · GW | Mix share change |
|---|
Challenges 0 / 3 completedLearn by changing the market +
Success applies to this simplified one-hour operating model, not a full investment or policy assessment. Completion is saved only in this browser.
03 Inside the generator fleetDispatch, costs & operating margins +
| Technology | Installed GW | Available GW | Dispatched GW | Marginal cost €/MWh | Emissions t CO₂ | Operating margin €/hour |
|---|
Model assumptionsA simplified market, with transparent rules +
One zone. One hour. One price.
This is an educational simulation, not a forecast. Illustrative generators bid their marginal costs in a competitive, single-zone market. Output is divisible; the cheapest available capacity is dispatched first. The last generator actually needed sets a uniform price for all electricity served.
There are no network constraints, losses, imports, storage, minimum loads, ramp limits, start-up costs, or reserve requirements. Negative bids and scarcity pricing are not modelled. Equal-cost generators are ordered by their original fleet order: wind, solar, nuclear, coal, combined-cycle gas, peaker.
If supply is insufficient, every available generator runs. Unmet demand is reported and the price and all operating margins are unavailable. We do not invent a scarcity price.
Costs & units
- Wind: installed GW × wind availability; €0/MWh.
- Solar: installed GW × solar availability; €0/MWh. Default installed capacity is zero.
- Nuclear: 20 GW; €12/MWh.
- Coal: 25 GW; 30 + carbon × 0.90.
- Combined-cycle gas: 30 GW; gas ÷ 0.55 + 3 + carbon × 0.37.
- Gas peaker: 15 GW; gas ÷ 0.35 + 5 + carbon × 0.58.
Gas is €/MWh of fuel; carbon is €/tonne CO₂. Coal, combined-cycle gas and peaker emissions factors are 0.90, 0.37 and 0.58 t CO₂/MWh of electricity. Wind, solar and nuclear operational emissions are zero; lifecycle emissions are excluded.
Thermal and nuclear availability is 100% of installed capacity. Default installed capacities are editable. This models one hour of operations. It does not assess construction costs, annual reliability, or investment returns. The fleet with the lowest operating costs is not necessarily cheapest to build. 1 GW for one hour = 1,000 MWh. Operating margin = (price − marginal cost) × dispatched MWh. It excludes fixed and capital costs and is not total profit. Emissions intensity uses electricity actually served. Baseline comparisons always use the default inputs; values are calculated at full precision before display rounding.