Contract networks for electric power transmission

Hogan, William W.

doi:10.1007/bf00133621

“…Several classes of financial property rights for ESS have appeared in the literature. As opposed to their transmission counterparts, for which its impracticality has been shown [3] as a result of the physics of electricity, the feasibility of physical storage rights to ESS was analysed in [8] for market allocation of storage resources in the different energy and ancillary services markets. Two other classes of financial rights to storage analogous to FGRs were introduced in [7], namely, energy capacity (ECR) and power capacity rights (PCR).…”

Section: B Relevant Literaturementioning

confidence: 99%

Financial storage rights for hydroelectricity

Martins

¹

,

Hochstetler²

2019

2019 International Conference on Smart Energy Systems and Technologies (SEST)

1

0

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There has recently been growing interest in the development of financial storage rights for energy storage systems as instruments akin to their transmission counterparts as a means to not only distribute congestion rents, but also to mitigate price risks, and even to signal and finance investments in light of increasing penetration of renewable generation and downward pressures on market clearing prices. This work presents a discussion on the applicability of such instruments to hydroelectric power plants as a mechanism to decouple ownership and operation of reservoirs, especially those with small regulating capacity, aiming to improve their valuation and investment risk management in electricity markets. The resulting model takes into consideration reasonable assumptions regarding their nonlinear physics and short-term operation properties, extending the applicability of a strong theoretical framework recently proposed in the literature to a large share of the energy mix.

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“…8 Nodal pricing is often considered as a benchmark for efficient congestion management. It allows for transmission pricing by considering loop-flows and line specific congestion in the market (Hogan, 1992(Hogan, , 1997Stoft, 1997). Market dispatch does not require congestion management measures under perfect foresight.…”

Section: Literature Overviewmentioning

confidence: 99%

Two price zones for the German electricity market — Market implications and distributional effects

Egerer

¹

,

Weibezahn

²

,

Hermann

³

2016

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractWe discuss the implications of two price zones, i.e. one northern and southern bidding area, on the German electricity market. In the northern zone, continuous capacity additions with low variable costs cause large regional supply surpluses in the market dispatch while conventional capacity decreases in the southern zone.As the spatial imbalance of supply and load is increasing, the current single bidding area results more often in technically infeasible market results requiring curative congestion management.There is an ongoing discussion about the potential effects of introducing bidding zones in Germany. Using a line sharp electricity sector model, this paper analyzes the system implications and the distributional effects of two bidding zones in the German electricity system in 2012 and 2015, respectively. Results show a modest decrease in cross-zonal re-dispatch levels, in particular in 2015. However, overall network congestion and re-dispatch levels increase in 2015 and also remain high for both bidding zones. Results are very sensitive to additional line investments illustrating the challenge to define stable price zones in a dynamic setting. With two bidding areas, prices in the model results increase in the southern zone and decrease in the northern zone. The average price deviation grows from 0.4 EUR/MWh in 2012 to 1.7 EUR/MWh in 2015 with absolute values being significantly higher in hours with price differences. Stakeholders within zones are exposed to the price deviations to a different extent. Distributional effects are surprisingly small compared to the wholesale price or different network charges.

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“…It allows for transmission pricing by considering loop-flows and line specific congestion in the market (Hogan, 1992(Hogan, , 1997Stoft, 1997). Market dispatch does not require congestion management measures under perfect foresight.…”

Section: Literature Overviewmentioning

confidence: 99%

Two Price Zones for the German Electricity Market: Market Implications and Distributional Effects

Egerer

¹

,

Weibezahn

²

,

Hermann³

2015

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractWe discuss the implications of two price zones, i.e. one northern and southern bidding area, on the German electricity market. In the northern zone, continuous capacity additions with low variable costs cause large regional supply surpluses in the market dispatch while conventional capacity decreases in the southern zone.As the spatial imbalance of supply and load is increasing, the current single bidding area results more often in technically infeasible market results requiring curative congestion management.There is an ongoing discussion about the potential effects of introducing bidding zones in Germany. Using a line sharp electricity sector model, this paper analyzes the system implications and the distributional effects of two bidding zones in the German electricity system in 2012 and 2015, respectively. Results show a modest decrease in cross-zonal re-dispatch levels, in particular in 2015. However, overall network congestion and re-dispatch levels increase in 2015 and also remain high for both bidding zones. Results are very sensitive to additional line investments illustrating the challenge to define stable price zones in a dynamic setting. With two bidding areas, prices in the model results increase in the southern zone and decrease in the northern zone. The average price deviation grows from 0.4 EUR/MWh in 2012 to 1.7 EUR/MWh in 2015 with absolute values being significantly higher in hours with price differences. Stakeholders within zones are exposed to the price deviations to a different extent. Distributional effects are surprisingly small compared to the wholesale price or different network charges.

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Contract networks for electric power transmission

Cited by 834 publications

References 14 publications

Financial storage rights for hydroelectricity

Financial storage rights for hydroelectricity

Two price zones for the German electricity market — Market implications and distributional effects

Two Price Zones for the German Electricity Market: Market Implications and Distributional Effects

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