RISK MITIGATION CAPABILITY OF FLEXIBILITY PERFORMANCE CONTRACTS FOR DEMAND RESPONSE IN ELECTRICITY SYSTEMS

The transition of the energy system increases the urgency to cope with the intermittency of renewable energy sources to keep the electricity network balanced. Demand Response (DR) measures are a promising approach to align the electricity consumption, especially of industrial consumers, with current electricity supply. While adequate information systems (IS) are already in place to dynamically adapt electricity consumption patterns, industrial consumers are still reluctant to implement DR measures due to uncertainty of their financial performance. Nevertheless, studies on risk transfer instruments related to DR investments are still scarce. To con-tribute to the closure of this research gap, we examine the risk transfer capability of Flexibility Performance Contracts (FPC). We derive cash flow structures for representative FPC designs, calculate risk premiums and enable the comparison of corresponding risk profiles. Presented FPCs are evaluated based on a real-world industrial use case. Thereby, the financial perfor-mance is modelled stochastically, taking electricity price fluctuation, industrial process charac-teristics and IS-backed decisions into account. Our results reveal that FPCs represent well-suited risk transfer instruments for DR measures. Thus, FPCs have the potential to accelerate the application of DR measures and therefore to complement existing capabilities of IS in the context of electricity networks

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

A Review of ISO New England's Proposed Market Rules

This report reviews the proposed rules for restructured wholesale electricity markets in New England. We review the market rules, both individually and collectively, and identify potential problems that might limit the efficiency of these markets. We examine alternatives and identify the key tradeoffs among alternative designs. We believe that the wholesale electricity market in New England can begin on December 1, 1998. However, improvements are needed for long-run success. We have identified four major recommendations: 1. Switch to a multi-settlement system. 2. Introduce demand-side bidding. 3. Adopt location-based transmission congestion pricing, especially for the import/export interfaces. 4. Fix the pricing of the ten minute spinning reserves.Auctions; Multiple Object Auctions; Electricity Auctions

Review on distribution network optimization under uncertainty

With the increase of renewable energy in electricity generation and increased engagement from demand sides, distribution network planning and operation face great challenges in the provision of stable, secure and dedicated service under a high level of uncertainty in network behaviors. Distribution network planning and operation, at the same time, also benefit from the changes of current and future distribution networks in terms of the availability of increased resources, diversity, smartness, controllability and flexibility of the distribution networks. This paper reviews the critical optimization problems faced by distribution planning and operation, including how to cope with these changes, how to integrate an optimization process in a problem-solving framework to efficiently search for optimal strategy and how to optimize sources and flexibilities properly in order to achieve cost-effective operation and provide quality of services as required, among other factors. This paper also discusses the approaches to reduce the heavy computation load when solving large-scale network optimization problems, for instance by integrating the prior knowledge of network configuration in optimization search space. A number of optimization techniques have been reviewed and discussed in the paper. This paper also discusses the changes, challenges and opportunities in future distribution networks, analyzes the possible problems that will be faced by future network planning and operations and discusses the potential strategies to solve these optimization problems

Future market design options for electricity markets with high RES-E: Lessons from the Irish Single Electricity Market. ESRI Working Paper No. 702 May 2021.

Variable renewable electricity generation presents challenges for traditional power markets. The island of Ireland has high levels of renewable generation by international standards with even higher levels envisaged and so must address these challenges. Market design is informed and constrained by EU policy and progress to date has been mixed. A qualitative review finds that market redesign is advised to address price cannibalisation, reveal consumer preferences for security and protect vulnerable households. Options for market design are presented and recommendations for short and medium term policy action are made

Power quality and electromagnetic compatibility: special report, session 2

The scope of Session 2 (S2) has been defined as follows by the Session Advisory Group and the Technical Committee: Power Quality (PQ), with the more general concept of electromagnetic compatibility (EMC) and with some related safety problems in electricity distribution systems. Special focus is put on voltage continuity (supply reliability, problem of outages) and voltage quality (voltage level, flicker, unbalance, harmonics). This session will also look at electromagnetic compatibility (mains frequency to 150 kHz), electromagnetic interferences and electric and magnetic fields issues. Also addressed in this session are electrical safety and immunity concerns (lightning issues, step, touch and transferred voltages). The aim of this special report is to present a synthesis of the present concerns in PQ&EMC, based on all selected papers of session 2 and related papers from other sessions, (152 papers in total). The report is divided in the following 4 blocks: Block 1: Electric and Magnetic Fields, EMC, Earthing systems Block 2: Harmonics Block 3: Voltage Variation Block 4: Power Quality Monitoring Two Round Tables will be organised: - Power quality and EMC in the Future Grid (CIGRE/CIRED WG C4.24, RT 13) - Reliability Benchmarking - why we should do it? What should be done in future? (RT 15

Energy policies and risks on energy markets; a cost-benefit analysis

The key question dealt with in this report is whether and how governments should be involved in taking measures regarding security of energy supply. In order to answer this question, we developed a framework for cost-benefit analysis and applied this framework to a number of policy options. Read also the press release and accompanying�document ' Increasing the reliability of electricity production: a cost-benefit analysis '. The options chosen vary from government investments in strategic oil stocks to financial incentives for consumers to reduce their consumption of electricity. The set of options comprises several types of governmental action, including subsidies, regulation and government investments. Moreover, the selection includes measures meant to address risks on all three major energy markets: oil, natural gas, and electricity. The general picture following from the cases studied is that security of supply measures are hardly ever beneficial to welfare: benefits of policy measures do generally not outweigh costs. From an economic point of view, therefore, it would be often wiser to accept consequences of supply disruptions than to pursue security of supply at any cost. This implies that governments should exercise caution in imposing measures regarding security of supply. If serious market failure is detected, careful attention should be paid to the design of the corrective measure. Establishing and maintaining well-functioning markets appears to be an efficient approach in realising a secure supply of energy. That approach would include removal of entry barriers, securing equal access to essential facilities and increasing transparency of markets.