scholarly journals Investment Incentives and Electricity Market Design: the British Experience

2005 ◽  
Vol 4 (2) ◽  
Author(s):  
Fabien A. Roques ◽  
David M. Newbery ◽  
William J. Nuttall
Keyword(s):  
Electricity Market ◽  
Market Design ◽  
Cost Recovery ◽  
Reserve Capacity ◽  
Investment Incentives ◽  
Market Failures ◽  
Electricity Trading ◽  
British Experience ◽  
Capacity Cost ◽  
Price Spikes

There is no academic consensus on which electricity market design provides the least distorting investment incentives. Theory suggests that "energy-only market" can allow capacity cost recovery by generators. However, separate payments for capacity or reserve obligations do not need to rely on infrequent price spikes to remunerate reserve capacity. Three years after the controversial change from the compulsory British Electricity Pool with capacity payments to the decentralised energyonly New Electricity Trading Arrangements (NETA), we contrast the two market designs in terms of investment incentives, analyse NETA's balancing market failures, and review the case for regulatory support for investment.

A Nice Electricity Market Design

2019 ◽  
Author(s):  
Chi-Keung Woo ◽  
Jay Zarnikau
Keyword(s):  
Electricity Market ◽  
Market Design

scholarly journals Investment Incentives in Competitive Electricity Markets

2018 ◽  
Vol 8 (10) ◽  
pp. 1978 ◽  
Author(s):  
Jaber Valinejad ◽  
Taghi Barforoshi ◽  
Mousa Marzband ◽  
Edris Pouresmaeil ◽  
Radu Godina ◽  
...  
Keyword(s):  
Electricity Markets ◽  
Electricity Market ◽  
Planning Horizon ◽  
Optimization Method ◽  
Design Criterion ◽  
Mixed Integer ◽  
Investment Incentives ◽  
Mixed Integer Linear Program ◽  
Interconnected Power System ◽  
The Impact

This paper presents the analysis of a novel framework of study and the impact of different market design criterion for the generation expansion planning (GEP) in competitive electricity market incentives, under variable uncertainties in a single year horizon. As investment incentives conventionally consist of firm contracts and capacity payments, in this study, the electricity generation investment problem is considered from a strategic generation company (GENCO) ′ s perspective, modelled as a bi-level optimization method. The first-level includes decision steps related to investment incentives to maximize the total profit in the planning horizon. The second-level includes optimization steps focusing on maximizing social welfare when the electricity market is regulated for the current horizon. In addition, variable uncertainties, on offering and investment, are modelled using set of different scenarios. The bi-level optimization problem is then converted to a single-level problem and then represented as a mixed integer linear program (MILP) after linearization. The efficiency of the proposed framework is assessed on the MAZANDARAN regional electric company (MREC) transmission network, integral to IRAN interconnected power system for both elastic and inelastic demands. Simulations show the significance of optimizing the firm contract and the capacity payment that encourages the generation investment for peak technology and improves long-term stability of electricity markets.

scholarly journals Market Evolution: Wholesale Electricity Market Design for 21st Century Power Systems

2013 ◽  
Author(s):  
Jaquelin Cochran ◽  
Mackay Miller ◽  
Michael Milligan ◽  
Erik Ela ◽  
Douglas Arent ◽  
...  
Keyword(s):  
Power Systems ◽  
21St Century ◽  
Electricity Market ◽  
Market Design ◽  
Market Evolution ◽  
Wholesale Electricity Market

Research on Surveillance Risk Index System of Unified and Interconnected Electricity Market in China

2014 ◽  
Vol 1070-1072 ◽  
pp. 1516-1523
Author(s):  
Chun Cheng Gao ◽  
Shu Hong Shi
Keyword(s):  
Electricity Market ◽  
Index System ◽  
Risk Index ◽  
First Grade ◽  
Risk Level ◽  
Electricity Trading ◽  
Operating Region ◽  
Market State ◽  
Grid Operation ◽  
And Control

After the establishment of the unified and interconnected electricity market in China, electricity trading range will cover the entire State Grid operating region, and headquarters market and provincial market will become interconnected, unified and coordinated operation. Aiming at the surveillance risk under the unified and interconnected electricity market, a relatively complete surveillance risk index system is proposed. The proposed risk index system includes six first grade indices, i.e., market state, transaction plan, contract and settlement, market coordination, energy efficiency and power grid operation. The risk index system can reasonably and overall reflect the risk level of the electric power transaction under the unified and interconnected electricity market circumstances. It is useful for State Grid to achieve risk management and control of electricity trading surveillance, rectify the irregularities, and maintain a fair and impartial market order.

scholarly journals Effects of a Delayed Expansion of Interconnector Capacities in a High RES-E European Electricity System

Energies ◽  
2019 ◽  
Vol 12 (16) ◽  
pp. 3098
Author(s):  
Ritter ◽  
Meyer ◽  
Koch ◽  
Haller ◽  
Bauknecht ◽  
...  
Keyword(s):  
Co2 Emissions ◽  
Electricity Market ◽  
Electricity Generation ◽  
Power Plants ◽  
Energy Transition ◽  
Market Model ◽  
Electricity Trading ◽  
Electricity System ◽  
System A ◽  
The Impact

In order to achieve a high renewable share in the electricity system, a significant expansion of cross-border exchange capacities is planned. Historically, the actual expansion of interconnector capacities has significantly lagged behind the planned expansion. This study examines the impact that such continued delays would have when compared to a strong interconnector expansion in an ambitious energy transition scenario. For this purpose, scenarios for the years 2030, 2040, and 2050 are examined using the electricity market model PowerFlex EU. The analysis reveals that both CO2 emissions and variable costs of electricity generation increase if interconnector expansion is delayed. This effect is most significant in the scenario year 2050, where lower connectivity leads roughly to a doubling of both CO2 emissions and variable costs of electricity generation. This increase results from a lower level of European electricity trading, a curtailment of electricity from a renewable energy source (RES-E), and a corresponding higher level of conventional electricity generation. Most notably, in Southern and Central Europe, less interconnection leads to higher use of natural gas power plants since less renewable electricity from Northern Europe can be integrated into the European grid.

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