Market-Based Coordination of Transmission and Generation Capacity Planning

We propose an ISO model for coordinating transmission expansion planning with competitive generation capacity planning in electricity markets. The purpose of the model is a holistic simulation of generation and transmission capacity expansion in the market environment. The solution represents an iterative process for simulating the interactions among GENCOs, TRANSCOs, and the ISO, which might be terminated by the ISO based on a pre-specified stopping criterion. The proposed model adopts a joint energy and transmission auction market and a capacity mechanism. The joint auction market enables competition to occur among generation and transmission resources. The capacity mechanism offers incentives for market participant investments that reflect the locational values of additional capacity. Transmission capacity expansion decisions are made by merchant transmission lines that recover their capacity investments through transmission marginal pricing and capacity payments. Transmission network security is reflected in the proposed competitive resource planning model. The examples illustrate a coordinated planning of generation and transmission in restructured power systems.     

有功和AGC联合电力市场调度模型及定价分析

自动发电控制(AGC)作为一种主要用于有功调频和实时电力电量平衡的负荷备用容量,与有功电能交易的耦合性较强,在系统运行出现波动时,AGC容量的确定直接关系到电能市场的价格波动.为了防止在线机组事后(即在实时调度中需要AGC时)通过滞留容量来牟取暴利,电力市场环境下如何考虑有功和AGC联合电力市场的协调运作问题是一个值得研究的课题.文中对此进行了讨论,首先建立了有功和AGC协调运作的联合市场调度模型,使得购买有功和AGC容量的费用最小;然后重点就联合优化下的AGC机组进行了定价分析,特别针对其机会成本和滞留容量等问题进行了讨论,得到了一些有益的结论.最后,通过算例仿真说明了所建模型的基本特征.     

Transmission Congestion and Competition on Power Generation Expansion

Generation expansion planning involves decisions on location and capacity of new generation, which may lead to adding or relieving congestion in transmission lines and to increasing or reducing competition in deregulated markets. Generation expansion may encounter congestion in the transmission network by constrained single-line flows as well as flowgate transfer capabilities. In this paper, a model to study the interaction between competition and transmission congestion on power generation expansion is proposed. The generation expansion problem is modeled as a Cournot competition game. Network transmission constraints are included in the optimal generation expansion problem to comply with power flow limits. Results from a five-bus power network and the IEEE 24-bus system are presented and discussed     

Energy bidding strategies for restructured electricity market

Many countries around the world have changed the economics of their electricity markets from monopolies to oligopolies in an effort to increase competition. The restructured electricity markets have introduced risk and uncertainty into a sector of the economy that was traditionally state-owned. Suppliers and customers use financial methods to manage the risk from market prices. The maximization of profit for power companies is highly associated with the bidding strategies. In order to maximize the profit, participants need suitable bidding models. In an open access electricity market, the bidding problem is a complicated task because of producer’s uncertain behaviors and demand fluctuation. Therefore, developing bidding strategy is extremely important for electricity market participants to achieve the maximum profit. This paper analyses a comprehensive literature on the state of the art research of bidding strategies in restructured electric power market.     

Understanding Competitive Pricing and Market Power in Wholesale Electricity Markets

Discussions of competition in restructured electricity markets have revealed many misunderstandings about the definition, diagnosis, and implications of market power, including the common myths that it is present in all markets and that it must be present in order for firms with significant fixed costs to remain profitable.     

A Framework to Implement Supply and Demand Side Contingency Management in Reliability Assessment of Restructured Power Systems

This paper presents a framework to implement supply and demand side contingency management in the reliability assessment of hybrid power markets. A model for the independent system operator (ISO) to coordinate reserve and load curtailment bids for contingency states is introduced to balance reliability worth and reliability cost. The load curtailments and generation re-dispatch for a contingency state are determined based on minimizing the market interruption cost using an optimization technique. A nonsequential Monte Carlo simulation technique based on this framework has been proposed to evaluate the customer reliability of restructured power systems with the hybrid market model. The modified IEEE Reliability Test System (RTS) is used to illustrate the proposed technique     

Where Function Follows Form: International Comparisons of Restructured Electricity Markets

If in architecture form should follow function, the reverse seems to be true in designing restructured electricity markets: function—and certainly market performance—appears to follow the form of the restructured electricity market. Designers should always ask, however, whether a simpler and less costly mechanism can achieve the results they are seeking.     

电力改制后的电力工业协调扩容规划

电力市场化改革使得原本垂直一体化的电力工业需要进行统一的协调规划。研究给出了市场条件下考虑用户需求的发、输协调规划投资的数学模型,并对如何求解该数学问题进行了分析说明。在现阶段厂网分开、竞价上网以及建设区域电力市场的环境下,给出了实施电力工业协调扩容规划的若干建议,研究了实施协调规划时需要考虑的机构设置、实施步骤、效益评估以及一些特殊情形的扩容规划。对发展中国家实施电力工业协调扩容有一定参考作用。     

Generation expansion planning in electricity markets: A novel framework based on dynamic stochastic MPEC

This paper presents a novel framework for generation expansion planning (GEP) of restructured power systems under uncertainty in a multi-period horizon, which includes generation investment from a price maker perspective. The investment problem is modeled as a bi-level optimization problem. The first level problem includes decisions related to investment in order to maximize total profit in the planning horizon. The second level problem consists of maximizing social welfare where the power market is cleared. Rival uncertainties on offering and investment are modeled using sets of scenarios. The bi-level optimization problem is then converted to a dynamic stochastic MPEC and represented as a mixed integer linear program (MILP) after linearization. The proposed framework is examined on a typical six-bus power network, MAZANDARAN regional electric company (MREC) transmission network as an area of IRAN interconnected power system and IEEE RTS 24-bus network. Simulation results confirm that the proposed framework can be a useful tool for analyzing the behavior of investments in electricity markets.     

引入投资决策的电力容量市场均衡分析

针对纯能量市场难以解决发电机组的固定成本回收问题,国外电力市场已开展了建立容量市场的实践,以市场化机制形成对机组补偿的价格信号,保障发电容量充裕性。文中从容量市场机制设计的角度出发,在考虑市场成员策略行为的前提下,对引入投资决策的电力容量市场进行了建模与均衡分析。首先,描述了容量市场的基本机理,针对容量市场的投资决策问题建立双层均衡模型,上层模型为寡头主体的最优决策模型,下层模型为容量市场出清模型;其次,利用最优性条件将双层模型转化为单层模型,运用分段线性化等方法实现模型线性化,得到混合整数线性规划问题;最后,基于中国某省的实际数据进行算例分析,深入探究了市场主体的策略行为,揭示了寡头主体抬价时的过度投资行为及其影响因素,提出限制项目竞标自由度的策略行为规制方法并验证了该方法的有效性。     

Day-ahead price forecasting in restructured power systems using artificial neural networks

Over the past 15 years most electricity supply companies around the world have been restructured from monopoly utilities to deregulated competitive electricity markets. Market participants in the restructured electricity markets find short-term electricity price forecasting (STPF) crucial in formulating their risk management strategies. They need to know future electricity prices as their profitability depends on them. This research project classifies and compares different techniques of electricity price forecasting in the literature and selects artificial neural networks (ANN) as a suitable method for price forecasting. To perform this task, market knowledge should be used to optimize the selection of input data for an electricity price forecasting tool. Then sensitivity analysis is used in this research to aid in the selection of the optimum inputs of the ANN and fuzzy c-mean (FCM) algorithm is used for daily load pattern clustering. Finally, ANN with a modified Levenberg–Marquardt (LM) learning algorithm are implemented for forecasting prices in Pennsylvania–New Jersey–Maryland (PJM) market. The forecasting results were compared with the previous works and showed that the results are reasonable and accurate.     

Quantifying price risk of electricity retailer based on CAPM and RAROC methodology

In restructured electricity markets, electricity retailers set up contracts with generation companies (GENCOs) and with end users to meet their load requirements at agreed upon tariff. The retailers invest consumer payments as capital in the volatile competitive market.

In this paper, a model for quantifying price risk of electricity retailer is proposed. An IEEE 30 Bus test system is used to demonstrate the model. The Capital Asset Pricing Model (CAPM) is demonstrated to determine the retail electricity price for the end users. The factor Risk Adjusted Recovery on Capital (RAROC) is used to quantify the price risk involved. The methodology proposed in this paper can be used by retailer while submitting proposal for electricity tariff to the regulatory authority.     

A survey of critical research areas in the energy segment of restructured electric power markets

Availability of a large volume of recent literature on deregulated (a.k.a. restructured) electricity markets underscores the importance of the research needs to ensure proper design and functioning of the markets. Researchers have made significant contributions fueling the evolution of the fundamental market design changes that have taken place since the beginning of the restructuring process. Due to the vast scope, existing survey papers are focused on particular facets of deregulated electricity markets. We adopt a similar approach by focusing on the most important research areas related to the energy market. The contributions of the survey paper lie in the novel approach used in classifying the literature based on critical research areas. Some areas of research such as auction based pricing, bidding strategy formulation, market equilibria, and market power are reviewed in a different light than other existing survey papers. We conclude by providing some future research directions for the energy markets.     

Strategies for Power Systems Expansion Planning in a Competitive Electrical Market

A new methodology is presented for decision making in long-term expansion planning. Power system expansion planning involves an intrinsic uncertainty on data and parameters, a fact often worsened by the new rules of deregulated electrical markets. The proposed procedure models both the uncertainty in load forecasting and the experience of the planning expert who uses fuzzy sets theory and fuzzy dynamic programming in the model algorithm to find an optimal expansion alternative.This procedure was tested in a realistic model system and the results obtained were arranged in an expansion planning ranking list according to their membership in the decision set.     

电力市场短期边际电价的分时重构混沌相空间预测

为了实现高精度的电力市场短期边际电价预测,该文对市场边际电价时间序列数据分时段聚类进行了相空间重构,并分别计算分形维数和提取最大Lyapunov指数,经分析得出了边际电价分时序列数据的演化具有混沌特征,由此提出了短期边际电价的分时重构混沌相空间预测算法,相比目前通常采用的单一时间序列混沌预测算法,该算法具有相空间嵌入维数少和模型参数配置灵活的特点,通过电力市场短期边际电价预测实例验证,结果表明该算法比单一时序混沌预测算法在预测精度上有显著提高.     

缺电情况下能开放电力市场吗?——兼论当量电价的应用

大多数发展中国家，特别是中国，电力需求还处在快速增长阶段，而且装机容量本来就不富裕，在投资体制还未理顺甚至还时有短缺的情况下，如何开放和建立电力市场是必须面对的问题。文中讨论了在容量短缺情况下开放和建立电力市场的基本要求：①必须在保持市场效率前提下，给予投资者充分合理的回报以鼓励投资；②必须同时建立容量市场风险制约的投资机制，加以制衡，以形成良性循环；②必须建立能够自动抑制市场电价不合理飞升的交易机制；④政府要有比设置价格上限更为有效合理的监管手段。指出：在规模经济性没有完全消失的条件下，传统边际成本定价方法无法给予容量充分的回报，而且也不能在寡头垄断市场条件下，有效、合理地抑制哄抬电价和持留容量行为，因此一般说来，在容量短缺情况下不适合使用该方法启动电力市场。认为：当量电价在保持市场效率前提下能给予投资者充分合理的回报，鼓励投资；同时引入容量市场风险制约的投资机制，加以制衡；还能自动抑制发电厂商哄抬电价和持留容量的不良行为，并为电力监管提供了清晰的思路，因此，即使在容量短缺情况下开放和建立电力市场，当量电价仍不失为一种可操作的、简单易行的方法。     

An Online Dynamic Cable Rating System for an Industrial Power Plant in the Restructured Electric Market

In addition to market information, available energy and capacity to participate in the market are also essential to be an effective market participant. This paper discusses the development of an online dynamic cable rating system (DCRS) that can help a system engineer maximize asset utilization without jeopardizing system facilities or compromising the reliability of the cables. Based on real-time cable loading, cable surface temperature, ambient temperature, and forecasting temperature, the DCRS can estimate both steady-state and dynamic cable rating. To confirm with the actual operation condition, both real-time cable temperature and forecasting ambient temperature are taken into consideration to perform short-term cable ampacity estimation to prevent overestimation and/or underestimation. Based on the information provided by the DCRS, the system engineer can establish or adjust the bidding strategy in time to effectively participate in the restructured electric markets.     

Transmission service outside of ISO footprints: inefficient spot prices,illiquid secondary markets and misguided planning

FERC-approved wholesale transmission tariffs outside of ISOs impose economically inefficient hourly transmission rates for Point-to-Point (PTP) energy transfers, because they recover long-run fixed costs of transmission capacity in excess of marginal costs. In addition, secondary markets in PTP contract rights suffer from the imperfections of bilateral markets and the lack of regulatory oversight. The experience of the Western Energy Imbalance Market shows the benefits of eliminating intra-hour prices for transmission capacity, to support the redispatch of generation. FERC should require that all hourly PTP transmission charges be eliminated, that unused and uncommitted transmission contract rights be subject to a mandatory and robust capacity release program, and that transmission expansion studies quantify the benefits of removing these artificial barriers to trade. Both consumers and the environment will benefit from better use of existing transmission capacity.     

Multiyear Transmission Expansion Planning Using Ordinal Optimization

The increasing complexity of the transmission expansion planning problem in the restructured industry makes simulation the only viable means to evaluate and compare the performances of different plans. Ordinal optimization is an approach suitable for solving the simulation-based multiyear transmission expansion planning problem. It uses crude models and rough estimates to derive a small set of plans for which simulations are necessary and worthwhile to find good enough solutions. In the end, reasonable solutions are obtained with drastically reduced computational burden.     

Excessive Price Volatility in the California Ancillary Services Markets: Causes,Effects, and Solutions

An analysis suggests that price volatility has been caused by generators' exercise of market power. The response by the California ISO has included the imposition of a fixed price cap and reforms intended to curb market power; but mechanisms used in other restructured electricity markets could have been considered, such as threats of regulatory action and use of hedge contracts.