2,363 research outputs found
Market Coupling as the Universal Algorithm to Assess Zonal Divisions
Adopting a zonal structure of electricity market requires specification of
zones' borders. In this paper we use social welfare as the measure to assess
quality of various zonal divisions. The social welfare is calculated by Market
Coupling algorithm. The analyzed divisions are found by the usage of extended
Locational Marginal Prices (LMP) methodology presented in paper [1], which
takes into account variable weather conditions. The offered method of
assessment of a proposed division of market into zones is however not limited
to LMP approach but can evaluate the social welfare of divisions obtained by
any methodology.Comment: 5 page
Time and location differentiated NOX control in competitive electricity markets using cap-and-trade mechanisms
Due to variations in weather and atmospheric chemistry, the timing and location of nitrogen oxide (NOX) reductions determine their effectiveness in reducing ground-level ozone, which adversely impacts human health. Electric generating plants are the primary stationary sources of NOX in most regions of the United States. In the Eastern U.S. they are subject to a summertime NOX cap and trade program that is not well matched to the time and locational impacts of NOX on ozone formation. We hypothesize that the integration of weather and atmospheric chemistry forecasting, a cap and trade system in which the "exchange rates" for permits can be varied by time and location based on these forecasts, and its application to a competitive wholesale electricity market, can achieve ozone standards more efficiently. To demonstrate the potential for reductions in NOX emissions in the short run, we simulate the magnitude of NOX reductions that can be achieved at various locations and times as a consequence of redispatch of generating units in the "classic" PJM region taking supply-demand balance constraints and network congestion into account. We report simulations using both a zonal model and an optimal power flow model.(cont.) We also estimate the relationship between the level NOX emission prices, competitive market responses to different levels of NOX prices, and the associated reductions in NOx emissions. The estimated maximum potential reductions, which occur at NOX prices of about $125,000/ton, are about 8 tons (20%) hourly in peak electricity demand hours and about 10 tons (50%) in average demand hours. We find that network constraints have little effect on the magnitude of the reductions in NOX emissions.Funding provided jointly by the U.S. Environmental Protection Agency (EPA) and the National Oceanic and Atmospheric Administration (NOAA); as well as the CEEP
The Effects of Coal Capacity Retirement on Wholesale Electricity Prices: A Demand Side Analysis
U.S. electric utilities retired 47% of their coal-fired generation capacity between 2008-2017 and have plans to continue decreasing this capacity through 2020. This means that areas of the U.S., like the Pennsylvania-New Jersey-Maryland Interconnection (PJM) Regional Transmission Organization, not only have experienced, but will continue to experience major shifts in its energy fuel mix and available electricity generation capacity. On June 1, 2015, the American Electric Power (AEP) zone experienced the retirement of 5,408 MW of coal-fired generation capacity from the wholesale electricity market. This research analyzes the impacts of this retirement on wholesale prices, i.e., locational marginal price (LMP) of electricity. Demand-side analyses of wholesale electricity prices are performed by regressing LMP against electricity demand variables. These variables include: the generation forecast error occurring from differences between forecasted day-ahead electricity consumption and real-time consumption, degree cooling and heating days, and accounting for hourly, daily, and seasonal differences in electricity consumption. Regression analyses were performed for six zones within the PJM for a 24-month period from June 1st, 2014 â June 1st, 2016, thus including 12 months of available data before and after the capacity retirement. Four analyses were created to measure the effects of consumption forecast error and coal-fired capacity retirement timing on LMP. The results from the four analyses demonstrate that: (1) average LMP in all zones decreased by between 16.6% and 29.2% if coal-fired generation capacity was projected to retire a year earlier than its observed retirement, and (2) average LMP in all zones increased by between 15.0% and 26.9% if this capacity was projected not to retire. The outcomes also showed early retirement of the coal-fired capacity resulted in more stable LMPs. The magnitude of percent decreases in LMP in the top 5% of observations was much larger during the early retirement analyses compared to the no retirement analyses. These price trends align with the national wholesale electricity price averages decreasing from June 1st, 2014 â June 1st, 2016. Thus, each of the six PJM zones did not experience any observed adverse effects on LMP from retirement of coal-fired generation capacity
Market design for a reliable ~100% renewable electricity system: Deliverable D3.5
Project TradeRES - New Markets Design & Models for 100% Renewable Power Systems: https://traderes.eu/about/ABSTRACT: The goal of this report is to identify in which respects the design and regulation of electricity markets needs to be improved in order facilitate a (nearly) completely decarbonized electricity system. It provides a basis for scoping the modeling analyses that are to be performed in subsequent work packages in the TradeRES project. These simulations will provide the basis for an update of this deliverable in the form of a more precise description of an all-renewable electricity market design. In this first iteration1 of deliverable 3.5, we analyze how the current design of electricity markets may fall short of future needs. Where there is a lack of certainty about the best market design choices, we identify alternative choices. Alternatives may concern a choice between policy intervention and no intervention or different intervention options. Section 2 outlines current European electricity market design and the key pieces of European legislation that underlie it. The European target model is zonal pricing with bidding zones that are defined as geographic areas within the internal market without structural congestion. That implies that within one bidding zone electricity can be traded without considering grid constraints and there are uniform wholesale prices in each zone. The main European markets are Nordpool, EPEX and MIBEL. Trading between zones in the European Price Coupling Region occurs through an implicit auction where price and quantity are computed for every hour of the next day, using EUPHEMIA, a hybrid algorithm for flowbased market coupling that is considered the best practice in Europe at this time.N/
A Review of the Monitoring of Market Power The Possible Roles of TSOs in Monitoring for Market Power Issues in Congested Transmission Systems
The paper surveys the literature and publicly available information on market power monitoring in electricity wholesale markets. After briefly reviewing definitions, strategies and methods of mitigating market power we examine the various methods of detecting market power that have been employed by academics and market monitors/regulators. These techniques include structural and behavioural indices and analysis as well as various simulation approaches. The applications of these tools range from spot market mitigation and congestion management through to long-term market design assessment and merger decisions. Various market-power monitoring units already track market behaviour and produce indices. Our survey shows that these units collect a large amount of data from various market participants and we identify the crucial role of the transmission system operators with their access to dispatch and system information. Easily accessible and comprehensive data supports effective market power monitoring and facilitates market design evaluation. The discretion required for effective market monitoring is facilitated by institutional independence.Electricity, liberalisation, market power, regulation
Mechanisms for efficient investments and optimal zones in regional power market
The paper is result of research different cross-border electricity trading
mechanisms impact. Focus is on investments in generation and transmission
power system facilities in regional market. Assumptions include efficient
market coupling mechanism (with more bidding zones), use of additional
investment indicators (like social welfare and congestion cost) and security
of supply issues (capacity mechanisms). There is discussion on cost benefits
analysis for particular market participants and there is possibility of risk
reduction for regional power system expansion. It is shown current
state-of-the-art, problems and trends in solving some aspects of market
integration and investment issues. In some cases smaller and well defined
bidding areas are absolutely essential in order to ensure system security and
economic efficiency. There is no single criterion for power system expansion
but it is possible to use combination of incentive schemes and possible
through one index for cross-border trade. Risk management for cross-border
electricity trading through several areas needs to be upgraded with use of
financial transmission rights like weighted average area prices,
respectively. Regional power system security is closely associated with
timely investments in energy supply in line with economic development and
environmental needs. Security of supply indicator is deriving an estimation
of security of supply improvement from the market based simulation results
when a generation or transmission investment project is implemented. All
researched makes market integration and investments in Europe more efficient
and gives more correct signals to market participants in regional market
The Scheme of a Novel Methodology for Zonal Division Based on Power Transfer Distribution Factors
One of the methodologies that carry out the division of the electrical grid
into zones is based on the aggregation of nodes characterized by similar Power
Transfer Distribution Factors (PTDFs). Here, we point out that satisfactory
clustering algorithm should take into account two aspects. First, nodes of
similar impact on cross-border lines should be grouped together. Second,
cross-border power flows should be relatively insensitive to differences
between real and assumed Generation Shift Key matrices. We introduce a
theoretical basis of a novel clustering algorithm (BubbleClust) that fulfills
these requirements and we perform a case study to illustrate social welfare
consequences of the division.Comment: 7 page
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