Welfare benefits of co-optimization of energy and reserves in electricity markets
Διπλωματική Εργασία
| Επιβλέπων | Αντώνιος Παπαβασιλείου |
|---|---|
| Συσχετιζόμενο μάθημα | Οικονομική και Αξιόπιστη Λειτουργία ΣΗΕ |
Περιγραφή
Framework
Power networks are evolving with the deep integration of renewable resources such as wind and solar power. These resources are unpredictable, hard to control, and variable, thus increasing the value for balancing capacity (reserve) services in electricity markets. This necessitates a redesign of electricity markets to adapt to these changes. Energy and balancing capacity are interdependent, as both rely on the same power generation capacity and require similar fixed costs and network capacity for delivery. Ignoring this interdependency leads to economic inefficiencies and pricing issues. Currently, European market operations separate the clearing of balancing capacity and energy. Balancing capacity is cleared before the day-ahead energy market, and asset owners must then nominate units to deliver the traded energy and balancing capacity. Resources cleared for balancing capacity must offer at least the contracted amount in the real-time energy market.
The paradigm described above contrasts to a joint clearing of energy and balancing capacity, which is the norm in several international markets, including the US. We will refer to this paradigm of jointly clearing energy and balancing capacity in the day-ahead market as co-optimisation. Quantifications of the inefficiencies introduced by the separate clearing of balancing capacity and energy at a European level have been performed in recent years [1]. However, these studies have assumed a joint clearing of reserve products which is not in line with standard EU practice, thus leading to an optimistic behaviour of the separate clearing of balancing capacity and energy. The objective of the present project is to quantify the inefficiencies brought by not clearing jointly the reserve products.
Theoretical background
- An understanding (or willing of understanding) of the operation of power markets in Europe.
- Exposure to mathematical programming.
Indicative thesis objectives
- Perform simulations of different sequential clearing designs
- Quantify the inefficiencies brought by not clearing jointly the reserve products.
Tools
The model is developed using the Julia programming language. A different language can be used to develop the simplified version (e.g. Python, Ampl, GAMS).
References
[1]https://www.acer.europa.eu/sites/default/files/documents/Publications/ACER_Cooptimisation_Benefits_Study_2024.pdf
[2] https://ap-rg.eu/wp-content/uploads/2020/07/J10.pdf