Overview Balance Management project

Transcription

1 Overview Balance Management project Ove S. Grande WS Gardermoen 26 January 11 SINTEF Energy Research 0

2 The Balance Management Project Competence building project in the framework of The Norwegian Research Council - Renergi Program. Project period Project partners: TSOs (Statnett, TenneT), regulator (NVE), 4 Norwegian producers, GDF Suez, Delft University of Technology, The Norwegian University of Science and Technology (NTNU) 2 Norwegian and 2 Dutch PhDs PhD funding from The Norwegian Research Council, Next Generation Infrastructure (NGI) NL and GDF Suez, Belgium SINTEF Energy Research 1

3 The Balance Management Project Motivation Optimal use of reserves over national borders Reduce reserve costs Exploit the favorable properties of hydro power plants as balancing resources Increased need for reserves due to a growing share of RES with less predictable output. Market coupling of European day ahead markets and the ongoing integration process in Europe SINTEF Energy Research 2

4 Balance management project Results Overview Balancing Mechanisms Northern Europe Analyses of present costs (incl. database marginal costs thermal prod) General market design aspects Potential exchange schemes between the Nordic and the Central European synchronous systems PhD work: Market design and regulatory aspects (TU Delft) Market models and simulations (NTNU) 4 seminars / WS: Arnhem, NL, Feda, N, Schiphol, NL, Gardermoen, N List of publications Dec 10: 4 TRs, 15 papers, database regulation costs thermal production, presentations/lectures Open documents downloadable at SINTEF Energy Research 3

5 Balancing Areas in Northern Europe SINTEF Energy Research 4

6 Future picture (?): The Nordic synchrounous region and the merged Norhtern Central European control area SINTEF Energy Research 5

7 Integration of balance management Main challenges Use of terminology Harmonization of market and rules Procurement and prioritization Timing market gate closure Settlement procedures Technical Exchange between separate synchronous systems via HVDC links Different production technologies Different control strategies SINTEF Energy Research 6

8 Definitions Imbalance Power Deviation: Difference between production output and consumption that will cause a rise or fall in frequency leading to activation of the primary control Regional/Area imbalance: Deviations from exchange plan for the defined balancing region/area. Area Control Error: ACE = Pexc + R f Settlement imbalance: Deviations from exchange plans for the balance responsible parties (BRP), in average over the settlement period (MWh/period) where the settlement period can be 60, 30 or 15 min. SINTEF Energy Research 7

9 Definitions Balancing control Primary Control: Automatic droop based frequency control Secondary Control: Automatic LFC/AGC Tertiary Control: Manual set point control Time Control: Manual set point control to eliminate the deviation between synchronous and universal time SINTEF Energy Research 8

10 Definitions Reserves (ETSO reference model) Frequency Containment Reserves (FCR) Operating reserves necessary for constant containment of frequency deviations (fluctuations) from nominal value Frequency Restoration Reserves (FRR) Operating reserves necessary to restore frequency to the nominal value after sudden system disturbance occurrence and consequently replace FCR Replacement Reserves (RR) Operating reserves necessary to restore the required level of operating reserves (FCR and FRR) SINTEF Energy Research 9

11 Definitions Balancing reserves Category Nordel Netherlands Germany Frequency Containment Reserves (FCR) Frequency Controlled Normal Operation Reserve (FCNOR) Primary reaction Primary Control capacity Frequency Controlled Disturbance Reserves (FCDR) Frequency Restoration Fast Active Regulation Capacity Secondary Control Reserves (FRR) Disturbance Reserves Reserve Capacity capacity (FADR) (Emergency Capacity) (Manually activated) Reserve Replacement Reserve Capacity Minutes reserves (RR) (Emergency Capacity) SINTEF Energy Research 10

12 Transition from market to physical operation in the Nordic region SINTEF Energy Research 11

13 Imbalance settlement Definitions Active balancing: Change in production or consumption on a request from the TSO to activate their bid in the balance market. Passive balancing: Contribution to regulation without having been requested to do so by the TSO. Two price settlement is used when different prices are used for active and passive balancing. Single and dual pricing: Only one or both of the up- and down prices within the hour SINTEF Energy Research 12

14 Alternatives for imbalance pricing: Marginal price. The price of the last balancing unit used. Average price of the energy balance actions.. Pay-as-bid. Each activation is paid the bid price. Elspot area price Incentive component (NL): Added to or subtracted from the imbalance price in the case of upward or downward regulation respectively SINTEF Energy Research 13

15 New Nordic model for BM settlement The Nordic TSOs have harmonised the pricing model based on two separate balances: Balance for production Balance for consumption The pricing of production imbalances is based on twoprice settlement and the pricing of consumption imbalances would be based on one-price settlement. SINTEF Energy Research 14

16 Overview imbalance settlement Settlement period [minutes] Balance definition Single/dual BM pricing Payment Mechanism Norway Consumption Dual (all Two prices Sweden Denmark 60 (Total) + Production countries from 2009) Marginal price Finland Netherlands 15 Total Dual One price Marginal price Germany 15 Total Single Two prices * Pay as bid / Average price SINTEF Energy Research 15

17 Balancing costs Technical report (ADAPT-consulting) : Documentation of present cost covering production and industrial consumption Spread sheet with cost data for 418 thermal production units (S, DK, GE, NL, B) Plan type Heat delivery Primary and secondary fuel Marginal fuel and CO2 costs Start/stop costs Efficiency SINTEF Energy Research 16

18 TR Balancing Market Design Role of Balancing Exchange of Balancing Services between control areas Design Variables Multi control area Balancing Market design proposals Performance criteria Evaluation of multinational balancing market designs SINTEF Energy Research 17

19 TR Exchange of Balancing resources between separate synchronous systems in Northern Europe Background Key principles for balance market integration The France-UK inititiative Merging of control areas in Northern Central Europe Exchange of reserves to/from the Nordic system System Characteristics Reserve requirements related to forecast uncertainties Balancing resources control objects Reservation of transmission capacity Pricing principles Alternative schemes for exchange (6 models proposed) Modeling of balance market integration in Northern Europe SINTEF Energy Research 18

20 Key principles BM integration (ERGEG) Security of supply Market based Mechanisms Effective Competition Impact of Cross-Border Trade reservation of transmission capacity Compatibility of balancing mechanisms SINTEF Energy Research 19

21 Nordic characteristics Balancing: Common merit order list Control criteria: f and t Restrictions: Bottlenecks, other opertional Automatic secondary control Balancing resources Hydro, Thermal, reducible loads Optimal choice of regulation objects Reserve requirements Allocation of HVDC transmission capacity SINTEF Energy Research 20

22 Optimal choise of control objects Efficiency of control actions is dependent of geographic location of control object Example: Loss of 100 MW production in Northern Norway in a situation with full utilization of the grid from north to south can be replaced by 60 MW load reduction in the Stockholm area due to reduction in marginal losses SINTEF Energy Research 21

23 Reserve requirements Update of Nordic requirements referring to congested corridors, not country borders Dynamic reservation related to wind and consumption forecast uncertainty SINTEF Energy Research 22

24 Allocation of HVDC transmission capacity P[MW] P ATC Balancing trade Intraday trade P BM P ID Day Ahead trade P DA ptu time SINTEF Energy Research 23

25 Sum up Main contributions Overview of balancing mechanisms in NE Regulation costs database thermal production Evaluation of market design Exchange with a merged N-CE control area parallel utilization of HVDC links Alternative exchange schemes between the Nordic and CE systems PhD work: Market design and regulatory aspects Modeling and analyses SINTEF Energy Research 24