scholarly journals Uncovering Wholesale Electricity Market Principles

2020 ◽  
pp. 145
Author(s):  
Michael Panfil ◽  
Rama Zakaria
Keyword(s):  
Public Policy ◽  
Electricity Market ◽  
Market Design ◽  
Ancillary Services ◽  
Policy Preferences ◽  
Court Decisions ◽  
Wholesale Market ◽  
Design Change ◽  
Market Structures ◽  
State Public Policy

This paper examines, enunciates, and makes explicit a set of market principles historically relied upon by the Federal Energy Regulatory Commission (FERC) to regulate wholesale electricity markets as required under the Federal Power Act (FPA). These identified competitive market principles are supported by policy and legal foundations that run through a myriad of FERC orders and court decisions. This paper seeks to make that history and those implicit market principles explicit by distilling and organizing Commission Orders and court decisions. It concludes that five market principles, each with multiple subprinciples, can be identified as elemental to how FERC understands and implements its statutory authority. Clear articulation of these foundational principles should help guide engaged entities as wholesale power markets continue to evolve. Market Principle 1 states that wholesale market revenues should predominantly flow from well-designed energy and ancillary services markets. Market structures generally are found to be preferable to non-market structures. Moreover, energy and ancillary services markets, in relationship to wholesale capacity markets, are better able to efficiently promote a least-cost resource. Market Principle 2 states that when altering market design, FERC and Independent System Operators (ISOs) should focus on only those services that are clearly needed, and ensure that any market design change does not unduly discriminate between resources. Market design changes focused on technology-neutral and well-defined granular services will help ensure that the design change does not lead to undue discrimination or preference that effectively favors certain resources. When such an impact still occurs, strong evidence showing that the rules are not unreasonable and arbitrary and that no non-unduly discriminatory and preferential alternative exists must support the change. Market Principle 3 states that interventions that distort transparent and accurate pricing should be minimized. Out-of-market interventions, in particular, have the potential to distort price signals and undermine competition. Market Principle 4 states that FERC’s just and reasonable standard strongly favors rate decreasing outcomes. Markets are premised on the economic presumption that competition reduces prices, in furtherance of the just and reasonable standard. Market Principle 5 states that FERC and ISOs should facilitate and not undermine state public policy preferences. FERC and ISOs are not well-situated to serve as decision-makers in determining which state public policy preferences should be given effect. State public policy preferences that do not run afoul of FERC’s authority under the FPA should thus be given full effect.

scholarly journals Re-Designing GB’s Electricity Market Design: A Conceptual Framework Which Recognises the Value of Distributed Energy Resources

Energies ◽  
2021 ◽  
Vol 14 (4) ◽  
pp. 1124
Author(s):  
Thomas Pownall ◽  
Iain Soutar ◽  
Catherine Mitchell
Keyword(s):  
Electricity Market ◽  
Large Scale ◽  
Market Design ◽  
Geographical Area ◽  
Energy Resources ◽  
Distributed Energy Resources ◽  
Distributed Energy ◽  
Wholesale Market ◽  
Efficient Operation ◽  
Net Zero

The design of electricity markets determines the technologies, services and modes of operation that can access value, consequently shaping current and future electricity landscapes. This paper highlights that the efficacy of Great Britain’s electricity market design in facilitating net zero is inadequate and must be reconfigured. The rules of the current electricity market design are remnants of an electricity sector dominated by large-scale, centralised, fossil fuel technologies. Therefore, routes to market for the provision of necessary services to support net zero, not least flexibility, are largely inaccessible for distributed energy resources and, despite their benefits to the system, are thus undervalued. Based upon a review and consolidation of 30 proposed electricity market designs from liberalised electricity sectors, this paper proposes a new electricity market design for Great Britain. This design is presented alongside a new institutional framework to aid in the efficient operation of the market. Specifically, this paper proposes a new local balancing and coordinating market located at each grid supply point (the transmission and distribution interface). This is realised through the implementation of a distributed locational marginal pricing structure which is governed by the evolution of the current distributed network operator, known as the distributed service provider (DSP). The DSP also operates a local balancing and ancillary market for their geographical area. The wholesale market is reconfigured to coordinate with these new local markets and to harmonise the actors across the distribution and transmission network.

A Nice Electricity Market Design

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

scholarly journals Soft Law Engagements and Hard Law Preferences: Comparing EU Lobbying Positions between UN Global Compact Signatory Firms and Other Interest Group Types

2021 ◽  
pp. 1-23
Author(s):  
Onna van den Broek
Keyword(s):  
Public Policy ◽  
Political Representation ◽  
Policy Preferences ◽  
Soft Law ◽  
The European Union ◽  
Global Compact ◽  
Un Global Compact ◽  
Political Activities ◽  
Policy Issues ◽  
The Relationship

Abstract Although corporate social responsibility (CSR) has gone “mainstream,” the relationship between CSR and corporate political activities (CPA) has received little scholarly attention. This is problematic because firms potentially have a more sizable impact through their lobbying activities for socially and environmentally beneficial (or unbeneficial) public policies than through their own operations. This paper investigates if, and how, UN Global Compact signatory firms differ in their policy preferences on key EU proposals compared to other interest groups. To capture state-of-the-art data on firms’ policy preferences, I draw from the INTEREURO database, which includes firms’ lobbying positions on forty-three directives and twenty-seven regulations covering 112 public policy issues in the European Union. Statistical results show that Global Compact signatory firms significantly lobby for stricter regulation than non-signatory firms and industry associations, however, their positions are still lower than nonbusiness groups. These results are similar across various public policy issues and suggest that the regulatory preferences of firms’ participating in soft law CSR initiatives are more aligned with stakeholders' interests. This paper contributes to public policy literature exploring the relationship between hard and soft law as well as literature studying the political representation of divergent interest.

scholarly journals Prosumer Community Portfolio Optimization via Aggregator: The Case of the Iberian Electricity Market and Portuguese Retail Market

Energies ◽  
2021 ◽  
Vol 14 (13) ◽  
pp. 3747
Author(s):  
Ricardo Faia ◽  
Tiago Pinto ◽  
Zita Vale ◽  
Juan Manuel Corchado
Keyword(s):  
Portfolio Optimization ◽  
Electricity Markets ◽  
Electricity Market ◽  
Retail Market ◽  
Wholesale Market ◽  
Generation Capacity ◽  
Wholesale Electricity Market ◽  
Portfolio Optimization Model ◽  
Photovoltaic Generators

The participation of household prosumers in wholesale electricity markets is very limited, considering the minimum participation limit imposed by most market participation rules. The generation capacity of households has been increasing since the installation of distributed generation from renewable sources in their facilities brings advantages for themselves and the system. Due to the growth of self-consumption, network operators have been putting aside the purchase of electricity from households, and there has been a reduction in the price of these transactions. This paper proposes an innovative model that uses the aggregation of households to reach the minimum limits of electricity volume needed to participate in the wholesale market. In this way, the Aggregator represents the community of households in market sales and purchases. An electricity transactions portfolio optimization model is proposed to enable the Aggregator reaching the decisions on which markets to participate to maximize the market negotiation outcomes, considering the day-ahead market, intra-day market, and retail market. A case study is presented, considering the Iberian wholesale electricity market and the Portuguese retail market. A community of 50 prosumers equipped with photovoltaic generators and individual storage systems is used to carry out the experiments. A cost reduction of 6–11% is achieved when the community of households buys and sells electricity in the wholesale market through the Aggregator.

Ancillary Services Potential for Flexible Combined Cycles

2021 ◽  
Author(s):  
Alberto Vannoni ◽  
Jose Angel Garcia ◽  
Weimar Mantilla ◽  
Rafael Guedez ◽  
Alessandro Sorce
Keyword(s):  
Electricity Market ◽  
Gas Turbines ◽  
High Efficiency ◽  
Combined Cycle ◽  
Ancillary Services ◽  
Ancillary Service ◽  
Spinning Reserve ◽  
Service Market ◽  
Partial Load ◽  
Ancillary Services Market

Abstract Combined Cycle Gas Turbines, CCGTs, are often considered as the bridging technology to a decarbonized energy system thanks to their high exploitation rate of the fuel energetic potential. At present time in most European countries, however, revenues from the electricity market on their own are insufficient to operate existing CCGTs profitably, also discouraging new investments and compromising the future of the technology. In addition to their high efficiency, CCGTs offer ancillary services in support of the operation of the grid such as spinning reserve and frequency control, thus any potential risk of plant decommissioning or reduced investments could translate into a risk for the well-functioning of the network. To ensure the reliability of the electricity system in a transition towards a higher share of renewables, the economic sustainability of CCGTs must be preserved, for which it becomes relevant to monetize properly the ancillary services provided. In this paper, an accurate statistical analysis was performed on the day-ahead, intra-day, ancillary service, and balancing markets for the whole Italian power-oriented CCGT fleet. The profitability of 45 real production units, spread among 6 market zones, was assessed on an hourly basis considering local temperature, specific plant layouts, and off-design performance. The assessment revealed that net income from the ancillary service market doubled, on average, the one from the day-ahead energy market. It was observed that to be competitive in the ancillary services market CCGTs are required to be more flexible in terms of ramp rates, minimum environmental loads, and partial load efficiencies. This paper explores how integrating a Heat Pump and a Thermal Energy Storage within a CCGT could allow improving its competitiveness in the ancillary services market, and thus its profitability, by means of implementing a model of optimal dispatch operating on the ancillary services market.

scholarly journals Assessment of the Target Model Implementation in the Wholesale Electricity Market of Greece

Energies ◽  
2021 ◽  
Vol 14 (19) ◽  
pp. 6397
Author(s):  
Filippos Ioannidis ◽  
Kyriaki Kosmidou ◽  
Kostas Andriosopoulos ◽  
Antigoni Everkiadi
Keyword(s):  
Electricity Market ◽  
System Capacity ◽  
Successful Implementation ◽  
The European Union ◽  
Wholesale Market ◽  
Target Model ◽  
Time Period ◽  
Unethical Behaviors ◽  
Wholesale Electricity Market ◽  
Of Greece

The European Union Target Model aims to integrate European energy market by removing barriers to trade and align markets. The most important goals of the Target Model are to provide consistent prices, enhance liquidity, support cross boarder trading, facilitate interconnections, and coordinate the use of transmission system capacity. In that context, the smooth operation of both forward and spot markets is a core development that directly affects the good operation of the wholesale market. This paper examines the application of the Target Model in the wholesale electricity market of Greece and its impact on electricity prices. The study explores the time period before the implementation of the Target Model, which took place on November 2020, and the first nine months of its execution. Based on the feedback received by the rest of the European countries, which are already part of the European Single Market, this crucial period of time is considered transitional, when many distortions and unethical behaviors take place. Empirical findings indicate a relatively successful implementation of the Target Model in Greece, with price disorders mostly met in the Balancing Market.

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
Sign in / Sign up

Export Citation Format

Share Document