Imbalance settlement evaluation for China's balancing market design via an agent-based model with a multiple criteria decision analysis method

Wu, Zhaoyuan; Zhou, Ming; Zhang, Ting; Li, Gengyin; Zhang, Yan; Liu, Xiaojuan

doi:10.1016/j.enpol.2020.111297

Cited by 21 publications

(11 citation statements)

References 44 publications

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“…In the analysis of bidding strategies for retailers with flexible demands, Song and Amelin [62] show the extent to which larger imbalances may be to the detriment of profits. Thus, while various studies have focused on the design of the balancing market [56][57][58][59][60], the forecasting of its price movements is under-researched [61][62][63]. Marneris, Roumkos, and Biskas [57] present a study on balancing market integration in the European region, while Wu and Zhou [59] recommend a dual pricing mechanism for balancing markets.…”

Section: Research On Balancing Systemsmentioning

confidence: 99%

Analysis of the Fundamental Predictability of Prices in the British Balancing Market

Bunn

Inekwe

MacGeehan

2021

IEEE Trans. Power Syst.

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This research analyses the non-linear and complex effects of drivers of system imbalance prices in the GB electricity market. Unlike day-ahead prices, the balancing settlement prices are comparatively under-researched, yet their importance is growing with greater market risks. The fundamental drivers of these prices are analysed over 2016-2019. The result of a nonlinear modelling approach reveals that system imbalance price exhibits a regime-switching behaviour, driven by weather and demand forecast errors, as well as other system effects. Surprisingly, balancing prices are predictable out of sample and a regime switching specification is more accurate than a linear model for prediction.

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Section: Research On Balancing Systemsmentioning

confidence: 99%

Analysis of the Fundamental Predictability of Prices in the British Balancing Market

Bunn

Inekwe

MacGeehan

2021

IEEE Trans. Power Syst.

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“…Small scale dynamic MFA; tracks material flows in production systems (Widok et al, 2011) SD with greater details on specific part of the system (Morgan et al, 2017) None 242 281 ABM Dynamic LCA of systems with no central control; models market potential (Micolier et al, 2019) Dynamic analysis integrating microeconomic and macroeconomic data; models market potential (Al Irsyad et al, 2019) Dynamic MFA of systems with no central control; models market potential (Bollinger et al, 2012) SD of systems where heterogeneity and emergence matters; models market potential (Brailsford et al, 2019) DES of technical infrastructure populated with individuals; models market potential (Abel and Faust, 2020) None 59 OR LCA of a system optimal state; decision when faced with multiple conflicting criteria (Thies et al, 2019) Macroeconomic impact of optimal local value chains; decision when faced with multiple conflicting criteria (Johansen et al, 2017) Optimization of material flows (Cooper et al, 2020) SD models system, OR finds optimal system configuration; decision when faced with multiple conflicting criteria (Linnéusson et al, 2020) DES models system, OR finds optimal system configuration; decision when faced with multiple conflicting criteria (Linnéusson et al, 2020) DES models system, OR finds optimal system configuration; decision when faced with multiple conflicting criteria (Wu et al, 2020) None ABM, agent-based modeling; SD, system dynamics; MFA, material flow analysis; EEIOA, environmentally extended input output analysis; LCA, life cycle assessment; OR, operations research; DES, discrete event simulation. contribution of a system to the environmental and economic pillars of sustainability but do not usually account for social aspects (Merli et al, 2018), while emergy and exergy focus on the environment through energy accounting.…”

Section: Evaluating Materials Efficiency Potentials and Sustainabilitymentioning

confidence: 99%

Do We Need a New Sustainability Assessment Method for the Circular Economy? A Critical Literature Review

Walzberg¹,

Lonca²,

Hanes³

et al. 2021

Front. Sustain.

112

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The goal of the circular economy (CE) is to transition from today's take-make-waste linear pattern of production and consumption to a circular system in which the societal value of products, materials, and resources is maximized over time. Yet circularity in and of itself does not ensure social, economic, and environmental performance (i.e., sustainability). Sustainability of CE strategies needs to be measured against their linear counterparts to identify and avoid strategies that increase circularity yet lead to unintended externalities. The state of the practice in quantitatively comparing sustainability impacts of circular to linear systems is one of experimentation with various extant methods developed in other fields and now applied here. While the proliferation of circularity metrics has received considerable attention, to-date, there is no critical review of the methods and combinations of methods that underlie those metrics and that specifically quantify sustainability impacts of circular strategies. Our critical review herein analyzes identified methods according to six criteria: temporal resolution, scope, data requirements, data granularity, capacity for measuring material efficiency potentials, and sustainability completeness. Results suggest that the industrial ecology and complex systems science fields could prove complementary when assessing the sustainability of the transition to a CE. Both fields include quantitative methods differing primarily with regard to their inclusion of temporal aspects and material efficiency potentials. Moreover, operations research methods such as multiple-criteria decision-making (MCDM) may alleviate the common contradictions which often exist between circularity metrics. This review concludes by suggesting guidelines for selecting quantitative methods most appropriate to a particular research question and making the argument that while there are a variety of existing methods, additional research is needed to combine existing methods and develop a more holistic approach for assessing sustainability impacts of CE strategies.

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“…Several studies have analyzed the impact of imbalance pricing on the VRE revenue [11][12][13][14][15]. Wan et al studied the impact of the imbalance settlement rule of the United States on WTs [11]; Brunetto and Tina applied the imbalance pricing rule of Italy [12]; and Chaves-Ávila et al compared the imbalance pricing rule of Belgium, Denmark, Germany, and the Netherlands [13].…”

Section: Introductionmentioning

confidence: 99%

“…However, as the number of VREs and the proportion of their generations increase, their output and their imbalance affect day-ahead and real-time market prices. Thus, to consider the impact of VREs' generations on the prices, the VREs are assumed as price makers in this study, as in [14,15]. Haring et al carried out the allocation of reserve costs via imbalance settlement benchmarking Nordic power markets and Switzerland [14].…”

Section: Introductionmentioning

confidence: 99%

Impact of Imbalance Pricing on Variable Renewable Energies with Different Prediction Accuracies: A Korean Case

et al. 2021

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Although the Korean government plans to increase its share of variable renewable energies (VREs), the Korean power market is not sufficiently mature to accommodate a large increase in VRE generation. Thus, the Korean system operator plans to introduce a two-settlement, and an imbalance settlement is also under consideration, among several options. Therefore, this study analyzes how many incentives are given for prediction accuracy under several imbalance settlement schemes adopted from European and US power markets. Results show that the imbalance settlement consisting of threshold and penalty terms is useful for rule-makers, who can control revenue differences between the groups with different prediction accuracies by adjusting the two terms. The suggestion given in the paper will be useful for not only the Korean power market but also for the countries that plan to establish the imbalance settlement rules while increasing renewable energy.

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Imbalance settlement evaluation for China's balancing market design via an agent-based model with a multiple criteria decision analysis method

Cited by 21 publications

References 44 publications

Analysis of the Fundamental Predictability of Prices in the British Balancing Market

Analysis of the Fundamental Predictability of Prices in the British Balancing Market

Do We Need a New Sustainability Assessment Method for the Circular Economy? A Critical Literature Review

Impact of Imbalance Pricing on Variable Renewable Energies with Different Prediction Accuracies: A Korean Case

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