Effects of Further Integration of Distributed Generation on the Electricity Market

Abstract

Environmental concern leads to legislation to stimulate the further integration of renewable energy in the Dutch electricity supply system. Distributed generation is suited for the integration of renewable energy sources. Furthermore it can be used to generate both heat and electricity in a more efficient way using ptCHP. Unfortunately, the additional integration of distributed generation has some negative consequences for the organisation of the electricity market. Programme responsible parties have to set up E-programmes which describe trade amongst them. Due to the higher unpredictability and uncontrollability of distributed generation, the E-programmes tend to be less accurate. This results in imbalance between supply and demand of electricity which has to be settled by the transmission system operator. This leads to extra costs for the programme responsible parties which could finally result in a drawback for the integration of renewable energy sources. Therefore market based solutions have to be created. INTRODUCTION minutes. The TSO verifies the E-programmes on consistency before approving them. The production and Due to environmental concerns and resulting demand for electricity should always be in balance since international legislation on the emissions of greenhouse electricity cannot yet be stored on a large scale. On the gasses, the use of renewable energy sources is day of the realisation of the E-programme, all stimulated. Renewable energy sources are often used in programme responsible parties have to exchange distributed electricity generation because of their electricity exactly as described in the E-programme. relatively low energy density. Unfortunately, the further Deviations result in imbalance in the system. integration of distributed generation (DG) in the electricity market causes a number of obstacles which To determine the E-programmes, programme have to be tackled. Many of those issues are purely responsible parties use profiles to estimate small loads. technical. Nevertheless some of them are related to the These profiles are based on historic data and external market and the organisation of the electricity supply conditions. Large loads are taken into account via data system. This paper discusses the problems, related to acquiring. Production of large facilities is known imbalance settlement, which are induced by the because of commitment of producers and production of unpredictability and uncontrollability of DG. small facilities is estimated. Due to uncertainties in the load profile of consumers there is always a certain imbalance in the electricity production system which

Photovoltaic energy in power market

“…The advantage of trading via APX instead of trading via long term contracts is that the quantity and price of the bid only has to be defined one day ahead. In this way it enables player and anticipation on weather conditions and load predictions in a better way to the variable fuel sources such as renewable energy [3].…”

“…Both for positive and negative imbalances markets exist. All suppliers receive an equal price when their capacity is dispatched [3].…”

“…The distribution of the deployment of the imbalance capacity is a Gaussian distribution with the mean of -11 MW and the standard deviation of 106 MW in 2006 [3]. Moreover, the third order trend line, which is the stochastic relation between the imbalance capacity and the difference of imbalance price and APX price at every fifteen minutes in 2005 is as (10).…”

“…λ(P imb ) = -6.1226 · 10 -7 · (P imb ) 3 It is assumed that the stochastic relation between the imbalance power and the price difference at every hour in 2006 has the same function as at every fifteen minutes in 2005. Therefore, the above function is considered as the stochastic relation between the expected hourly imbalance power and the expected hourly price difference in 2006.…”

Analysis of deployment of control power in the Netherlands

“…Figure 2 displays the amounts of energy traded in bilateral contracts 4 , on the day ahead APX 5 and for balance management 6 . Next to deployment of control power by the imbalance settlement system it is also possible to contribute in balance management without being called upon by the TSO.…”