A COMPARISON OF MARKET CLEARING TOOLS IN ELECTRICITY SYSTEMS

To maintain a strict balance between demand and supply in the US power systems, the Independent System Operators (ISOs) schedule power plants and determine electricity prices using a market clearing model. This model determines for each time period and power plant, the times of startup, shutdown, the amount of power production, and the provisioning of spinning and non-spinning power generation reserves, etc. Such a deterministic optimization model takes as input the characteristics of all the generating units such as their power generation installed capacity, ramp rates, minimum up and down time requirements, and marginal costs for production, as well as the forecast of intermittent energy such as wind and solar, along with the minimum reserve requirement of the whole system. This reserve requirement is determined based on the likelihood of outages on the supply side and on the levels of error forecasts in demand and intermittent generation. With increased installed capacity of intermittent renewable energy, determining the appropriate level of reserve requirements has become harder. Stochastic market clearing models have been proposed as an alternative to deterministic market clearing models. Rather than using a fixed reserve targets as an input, stochastic market clearing models take different scenarios of wind power into consideration and determine reserves schedule as output. Using a scaled version of the power generation system of PJM, a regional transmission organization (RTO) that coordinates the movement of wholesale electricity in all or parts of 13 states and the District of Columbia, and wind scenarios generated from BPA (Bonneville Power Administration) data, this paper explores a comparison of the performance between a stochastic and deterministic model in market clearing. The two models are compared in their ability to contribute to the affordability, reliability and sustainability of the electricity system, measured in terms of total operational costs, load shedding and air emissions. The process of building the models and running for tests indicate that a fair comparison is difficult to obtain due to the multi-dimensional performance metrics considered here, and the difficulty in setting up the parameters of the models in a way that does not advantage or disadvantage one modeling framework. Along these lines, this study explores the effect that model assumptions such as reserve requirements, value of lost load (VOLL) and wind spillage costs have on the comparison of the performance of stochastic vs deterministic market clearing models.

A strategic review of electricity systems models

Electricity systems models are software tools used to manage electricity demand and the electricity systems, to trade electricity and for generation expansion planning purposes. Various portfolios and scenarios are modelled in order to compare the effects of decision making in policy and on business development plans in electricity systems so as to best advise governments and industry on the least cost economic and environmental approach to electricity supply, while maintaining a secure supply of sufficient quality electricity. The modelling techniques developed to study vertically integrated state monopolies are now applied in liberalised markets where the issues and constraints are more complex. This paper reviews the changing role of electricity systems modelling in a strategic manner, focussing on the modelling response to key developments, the move away from monopoly towards liberalised market regimes and the increasing complexity brought about by policy targets for renewable energy and emissions. The paper provides an overview of electricity systems modelling techniques, discusses a number of key proprietary electricity systems models used in the USA and Europe and provides an information resource to the electricity analyst not currently readily available in the literature on the choice of model to investigate different aspects of the electricity system.

CASCADE: An Agent Based Framework For Modeling The Dynamics Of Smart Electricity Systems

The Complex Adaptive Systems, Cognitive Agents and Distributed Energy (CASCADE) project is developing a framework based on Agent Based Modelling (ABM). The CASCADE Framework can be used both to gain policy and industry relevant insights into the smart grid concept itself and as a platform to design and test distributed ICT solutions for smart grid based business entities. ABM is used to capture the behaviors of diff erent social, economic and technical actors, which may be defi ned at various levels of abstraction. It is applied to understanding their interactions and can be adapted to include learning processes and emergent patterns. CASCADE models ‘prosumer’ agents (i.e., producers and/or consumers of energy) and ‘aggregator’ agents (e.g., traders of energy in both wholesale and retail markets) at various scales, from large generators and Energy Service Companies down to individual people and devices. The CASCADE Framework is formed of three main subdivisions that link models of electricity supply and demand, the electricity market and power fl ow. It can also model the variability of renewable energy generation caused by the weather, which is an important issue for grid balancing and the profi tability of energy suppliers. The development of CASCADE has already yielded some interesting early fi ndings, demonstrating that it is possible for a mediating agent (aggregator) to achieve stable demandfl attening across groups of domestic households fi tted with smart energy control and communication devices, where direct wholesale price signals had previously been found to produce characteristic complex system instability. In another example, it has demonstrated how large changes in supply mix can be caused even by small changes in demand profi le. Ongoing and planned refi nements to the Framework will support investigation of demand response at various scales, the integration of the power sector with transport and heat sectors, novel technology adoption and diffusion work, evolution of new smart grid business models, and complex power grid engineering and market interactions.

Economic criteria for the selection and development of power stations and electricity systems

Includes bibliography

Some problems arising from the development of power stations and electricity systems

Includes bibliography

A comparison of integrated biomass to electricity systems

This thesis presents a comparison of integrated biomass to electricity systems on the basis of their efficiency, capital cost and electricity production cost. Four systems are evaluated: combustion to raise steam for a steam cycle; atmospheric gasification to produce fuel gas for a dual fuel diesel engine; pressurised gasification to produce fuel gas for a gas turbine combined cycle; and fast pyrolysis to produce pyrolysis liquid for a dual fuel diesel engine. The feedstock in all cases is wood in chipped form. This is the first time that all three thermochemical conversion technologies have been compared in a single, consistent evaluation.The systems have been modelled from the transportation of the wood chips through pretreatment, thermochemical conversion and electricity generation. Equipment requirements during pretreatment are comprehensively modelled and include reception, storage, drying and communication. The de-coupling of the fast pyrolysis system is examined, where the fast pyrolysis and engine stages are carried out at separate locations. Relationships are also included to allow learning effects to be studied. The modelling is achieved through the use of multiple spreadsheets where each spreadsheet models part of the system in isolation and the spreadsheets are combined to give the cost and performance of a whole system.The use of the models has shown that on current costs the combustion system remains the most cost-effective generating route, despite its low efficiency. The novel systems only produce lower cost electricity if learning effects are included, implying that some sort of subsidy will be required during the early development of the gasification and fast pyrolysis systems to make them competitive with the established combustion approach. The use of decoupling in fast pyrolysis systems is a useful way of reducing system costs if electricity is required at several sites because• a single pyrolysis site can be used to supply all the generators, offering economies of scale at the conversion step. Overall, costs are much higher than conventional electricity generating costs for fossil fuels, due mainly to the small scales used. Biomass to electricity opportunities remain restricted to niche markets where electricity prices are high or feed costs are very low. It is highly recommended that further work examines possibilities for combined beat and power which is suitable for small scale systems and could increase revenues that could reduce electricity prices.

Essays on market design and regulation in electricity systems

This thesis discusses market design and regulation in electricity systems, focusing on the information exchange of the regulated grid firm and the generation firms as well as the regulation of the grid firm. In the first chapter, an economic framework is developed to consistently analyze different market designs and the information exchange between the grid firm and the generation firms. Perfect competition between the generation firms and perfect regulation of the grid firm is assumed. A numerical algorithm is developed and its feasibility demonstrated on a large-scale problem. The effects of different market designs for the Central Western European (CWE) region until 2030 are analyzed. In the second chapter, the consequences of restricted grid expansion within the current market design in the CWE region until 2030 are analyzed. In the third chapter the assumption of efficient markets is modified. The focus of the analysis is then, whether and how inefficiencies in information availability and processing affect different market designs. For different parameter settings, nodal and zonal pricing are compared regarding their welfare in the spot and forward market. In the fourth chapter, information asymmetries between the regulator and the regulated firm are analyzed. The optimal regulatory strategy for a firm, providing one output with two substitutable inputs, is defined. Thereby, one input and the absolute quantity of inputs is not observable for the regulator. The result is then compared to current regulatory approaches.

Benchmarking sustainability of Indian electricity system: An indicator approach

India needs to significantly increase its electricity consumption levels, in a sustainable manner, if it has to ensure rapid economic development, a goal that remains the most potent tool for delivering adaptation capacity to its poor who will suffer the worst consequences of climate change. Resource/supply constraints faced by conventional energy sources, techno-economic constraints faced by renewable energy sources, and the bounds imposed by climate change on fossil fuel use are likely to undermine India's quest for having a robust electricity system that can effectively contribute to achieving accelerated, sustainable and inclusive economic growth. One possible way out could be transitioning into a sustainable electricity system, which is a trade-off solution having taken into account the economic, social and environmental concerns. As a first step toward understanding this transition, we contribute an indicator based hierarchical multidimensional framework as an analytical tool for sustainability assessment of electricity systems, and validate it for India's national electricity system. We evaluate Indian electricity system using this framework by comparing it with a hypothetical benchmark sustainable electrical system, which was created using best indicator values realized across national electricity systems in the world. This framework, we believe, can be used to examine the social, economic and environmental implications of the current Indian electricity system as well as setting targets for future development. The analysis with the indicator framework provides a deeper understanding of the system, identify and quantify the prevailing sustainability gaps and generate specific targets for interventions. We use this framework to compute national electricity system sustainability index (NESSI) for India. (C) 2014 Elsevier Ltd. All rights reserved.

Impact of a price-maker pumped storage hydro unit on the integration of wind energy in power systems

The increasing integration of larger amounts of wind energy into power systems raises important operational issues, such as the balance between power generation and demand. The pumped storage hydro (PSH) units are one possible solution to mitigate this problem, once they can store the excess of energy in the periods of higher generation and lower demand. However, the behaviour of a PSH unit may differ considerably from the expected in terms of wind power integration when it operates in a liberalized electricity market under a price-maker context. In this regard, this paper models and computes the optimal PSH weekly scheduling in a price-taker and price-maker scenarios, either when the PSH unit operates in standalone and integrated in a portfolio of other generation assets. Results show that the price-maker standalone PSH will integrate less wind power in comparison with the price-taker situation. Moreover, when the PSH unit is integrated in a portfolio with a base load power plant, the role of the price elasticity of demand may completely change the operational profile of the PSH unit. (C) 2014 Elsevier Ltd. All rights reserved.

Cost savings from relaxation of operational constraints on a power system with high wind penetration

Wind energy is predominantly a nonsynchronous generation source. Large-scale integration of wind generation with existing electricity systems, therefore, presents challenges in maintaining system frequency stability and local voltage stability. Transmission system operators have implemented system operational constraints (SOCs) in order to maintain stability with high wind generation, but imposition of these constraints results in higher operating costs. A mixed integer programming tool was used to simulate generator dispatch in order to assess the impact of various SOCs on generation costs. Interleaved day-ahead scheduling and real-time dispatch models were developed to allow accurate representation of forced outages and wind forecast errors, and were applied to the proposed Irish power system of 2020 with a wind penetration of 32%. Savings of at least 7.8% in generation costs and reductions in wind curtailment of 50% were identified when the most influential SOCs were relaxed. The results also illustrate the need to relax local SOCs together with the system-wide nonsynchronous penetration limit SOC, as savings from increasing the nonsynchronous limit beyond 70% were restricted without relaxation of local SOCs. The methodology and results allow for quantification of the costs of SOCs, allowing the optimal upgrade path for generation and transmission infrastructure to be determined.

Intelligent demand response electric water heating to integrate wind power in Ireland

Dwindling fossil fuel resources and pressures to reduce greenhouse gas (GHG) emissions will result in a more diverse range of generation portfolios for future electricity systems. Irrespective of the portfolio mix the overarching requirement for all electricity suppliers and system operators is that supply instantaneously meets demand and that robust operating standards are maintained to ensure a consistent supply of high quality electricity to end-users. Therefore all electricity market participants will ultimately need to use a variety of tools to balance the power system. Thus the role of demand side management (DSM) with energy storage will be paramount to integrate future diverse generation portfolios. Electric water heating (EWH) has been studied previously, particularly at the domestic level to provide load control, peak shave and to benefit end-users financially with lower bills, particularly in vertically integrated monopolies. In this paper, a continuous Direct Load Control (DLC) EWH algorithm is applied in a liberalized market environment using actual historical electricity system and market data to examine the potential energy savings, cost reductions and electricity system operational improvements.

Integrating wind power using intelligent electric water heating

Dwindling fossil fuel resources and pressures to reduce greenhouse gas emissions will result in a more diverse range of generation portfolios for future electricity systems. Irrespective of the portfolio mix the overarching requirement for all electricity suppliers and system operators is to instantaneously meet demand, to operate to standards and reduce greenhouse gas emissions. Therefore all electricity market participants will ultimately need to use a variety of tools to balance the power system. Thus the role of demand side management with energy storage will be paramount to integrate future diverse generation portfolios. Electric water heating has been studied previously, particularly at the domestic level to provide load control, peak shave and to bene?t end-users ?nancially with lower bills, particularly in vertically integrated monopolies. In this paper a number of continuous direct load control demand response based electric water heating algorithms are modelled to test the effectiveness of wholesale electricity market signals to study the system bene?ts. The results are compared and contrasted to determine which control algorithm showed the best potential for energy savings, system marginal price savings and wind integration.

The role of conventional generation in managing variability

As electricity systems incorporate increasing levels of variable renewable generation, conventional plant will be required to operate more flexibly, with potential impacts for economic viability and reliability. Northern Ireland is pursuing an ambitious target of 40% of electricity to be supplied from renewable sources by 2020. The dominant source of this energy is anticipated to come from inherently variable wind power, one of the most mature renewable technologies. Conventional thermal generators will have a significant role to play in maintaining security of supply. However, running conventional generation more flexibly in order to cater for a wind led regime can reduce its efficiency, as well as shortening its lifespan and increasing O&M costs. This paper examines the impacts of variable operation on existing fossil fuel based generators, with a particular focus on Northern Ireland. Access to plant operators and industry experts has provided insight not currently evident in the energy literature. Characteristics of plant operation and the market framework are identified that present significant challenges in moving to the proposed levels of wind penetration. Opportunities for increasing flexible operation are proposed and future research needs identified.

Measuring significant variability characteristics: An assessment of three UK renewables

The variability of renewable energy is widely recognised as a challenge for integrating high levels of renewable generation into electricity systems. However, to explore its implications effectively, variability itself should first be clearly understood. This is particularly true for national electricity systems with high planned penetration of renewables and limited interconnection such as the UK. Variability cannot be considered as a distinct resource property with a single measurable parameter, but is a multi-faceted concept best described by a range of distinct characteristics. This paper identifies relevant characteristics of variability, and considers their implications for energy research. This is done through analysis of wind, solar and tidal current resources, with a primary focus on the Bristol Channel region in the UK. The relationship with electricity demand is considered, alongside the potential benefits of resource diversity. Analysis is presented in terms of persistence, distribution, frequency and correlation between supply and demand. Marked differences are seen between the behaviours of the individual resources, and these give rise to a range of different implications for system integration. Wind shows strong persistence and a useful seasonal pattern, but also a high spread in energy levels at timescales beyond one or two days. The solar resource is most closely correlated with electricity demand, but is undermined by night-time zero values and an even greater spread of monthly energy delivered than wind. In contrast, the tidal resource exhibits very low persistence, but also much greater consistency in energy values assessed across monthly time scales. Whilst this paper focuses primarily on the behaviour of resources, it is noted that discrete variability characteristics can be related to different system impacts. Persistence and predictability are relevant for system balancing, whereas statistical distribution is more relevant when exploring issues of asset utilisation and energy curtailment. Areas of further research are also identified, including the need to assess the value of predictability in relation to other characteristics.