Toward a fundamental understanding of flow-based market coupling for cross-border electricity trading

Schönheit, David; Kenis, Michiel; Lorenz, Lisa; Möst, Dominik; Delarue, Erik; Bruninx, Kenneth

doi:10.1016/j.adapen.2021.100027

Cited by 33 publications

(14 citation statements)

References 14 publications

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“…Studies generally focus on the formal dimension in their numerical experiments by describing the relation of a specific parametrization policy to a chosen metric, e.g., system cost or welfare, with the goal to provide a better understanding of parameter choices. Current literature on flow-based parameter policies in relation to system cost exist for GSKs (Voswinkel et al, 2019), min-RAMs (Schönheit et al, 2021b), commercial exchange and uncertainty in the basecase parametrization (Byers and Hug, 2020) and selection of CNECs (Schönheit et al, 2021c). All contribute to better understanding the relation between the parameters, however comparability remains difficult since it requires similar definitions on how flow-based domains should be used.…”

Section: Flow Based Discussionmentioning

confidence: 99%

“…However, the process's ability to accommodate policy decisions and impact of integration of large shares of RES is mostly absent. In Schönheit et al (2021c) the authors describe the TSOs degree of freedom to influence the parametrization and its impact on results. The analysis also includes a scenario with moderate increase in RES capacities.…”

Section: Related Literaturementioning

confidence: 99%

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Uncertainty-Aware Capacity Allocation in Flow-Based Market Coupling

Weinhold¹,

Mieth²

2021

Preprint

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The effective allocation of cross-border trading capacities is one of the central challenges in implementation of a pan-European internal energy market. flow-based market coupling (FBMC) has shown promising results for to achieve better price convergence between market areas, while, at the same time, improving congestion management effectiveness by explicitly internalizing power flows on critical network elements in the capacity allocation routine. However, the question of FBMC effectiveness for a future power system with a very high share of intermittent renewable generation is often overlooked in the current literature. This paper provides a comprehensive summary on FBMC modeling assumptions, discusses implications of external policy considerations and explicitly discusses the impact of high-shares of intermittent generation on the effectiveness of FBMC as a method of capacity allocation and congestion management in zonal electricity markets. We propose to use an RES uncertainty model and probabilistic security margins on the FBMC parameterization to effectively assess the impact of forecast errors in renewable dominant power systems. Numerical experiments on the wellstudied IEEE 118 bus test system demonstrate the mechanics of the studied FBMC simulation. Our data and implementation are published through the open-source Power Market Tool (POMATO).

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Section: Flow Based Discussionmentioning

confidence: 99%

Section: Related Literaturementioning

confidence: 99%

Uncertainty-Aware Capacity Allocation in Flow-Based Market Coupling

Weinhold¹,

Mieth²

2021

Preprint

View full text Add to dashboard Cite

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“…By incorporating the PTDFs, there are fewer limitations to the solution domain, and one obtains a better utilization of the system. The PTDFs are obtained from the AC power flow equations through a DC power flow representation of the power electricity grid [35][36][37]40].…”

Section: Fb Methodology On Cross-border Electricity Tradingmentioning

confidence: 99%

“…The results, such as net positions and prices, are provided to the market. During the post-market coupling process, the TSO verifies the market results, analyzes the operational security, and deals with the congestion rent [36,40].…”

mentioning

confidence: 99%

Coordinating Capacity Calculation via Electricity Market Coupling: Insights from the H2020 CROSSBOW Project

et al. 2022

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CROSS BOrder management of variable renewable energies and storage units enabling a transnational Wholesale market (CROSSBOW) is an EC-funded project, whose aim is to facilitate the shared use of energy resources by fostering cross-border management of variable renewable energies and storage units, enabling higher penetration of renewable energy sources (RES) whilst reducing network operational costs and improving economic benefits of clean energies and storage units. Towards these goals, CROSSBOW boosts regional cooperation among the system operators in Southeastern Europe (SEE), by deploying nine different tools to support the security coordination center (SCC) of the region. More specifically, the main CROSSBOW product, namely CROSSBOW Regional Operation Centre (CROSSBOW ROC) has proposed and demonstrated a set of functionalities for regional management and operation that enhance the existing regional structures, extending the capabilities of the already established Regional Security Coordinator (RSC) initiatives. Beyond enhancing RSC mandatory functions (including adequacy forecasts, coordinated security analysis, capacity calculations, and outage planning coordination), the ROC-BC product has developed new functions, linking the security considerations of involved TSOs with the operation of the fast-developing and harmonized electricity markets. In this paper, we investigate approaches for coordinated capacity calculation and cross-border trading via market coupling, developed within the ROC-BC product of CROSSBOW. Moreover, we present the final demonstration results as a part of ROC fundamental functionalities. Specifically, both net transfer capacity (NTC) and flow-based (FB) methods are examined and compared within a case study applying to the SEE region. The presented results demonstrate that the FB method exhibits better performance in all examined scenarios, considering three different key performance indicators (KPIs).

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“…Academic publications on modeling FBMC and its parametrizations are still scarce. Early publications such as Van den Bergh et al (2016) and Boury (2015) formally describe the process and are extended recently by Schönheit et al (2021);Felten et al (2021); Byers and Hug (2020) that discuss input parameters and their effects, illustrated by stylized examples. Generally, most academic publications adhere to a similar methodology that is depicted in Figure 1 and utilize an economic dispatch problem for each of the three steps.…”

Section: D-1: Market Couplingmentioning

confidence: 99%

Evaluating Policy Implications on the Restrictiveness of Flow-based Market Coupling with High Shares of Intermittent Generation: A Case Study for Central Western Europe

Weinhold¹

2021

Preprint

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The current stage in the evolution of the European internal energy market for electricity is defined by the transformation towards a renewable energy system. The Clean Energy Package aims to ensure that methods for capacity allocation and congestion management, that are at the center of the European internal market for electricity, align with this transformation.Flow-based market coupling, the preferred method for capacity allocation, is first and foremost a formal process to allocate exchange capacities to the markets. However, the process also allows for many considerations of the involved parties that impact the resulting capacities. As part of the Clear Energy Package, the regulatory body enacted their ambition to increase exchange capacities by enforcing transmission system operators to allocate a minimum margin of physical line capacity with the goal of providing a higher level of competition and better integration of renewable energy sources. This study investigates this and other policy relevant consideration of flow-based market coupling.The model results quantify the trade-off between permissive capacity allocation and increased congestion management. For high shares of intermittent renewable generation, less constrained exchange capacities are favorable, however also highlight the importance of the markets ability to integrate high shares of intermittent generation.

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Toward a fundamental understanding of flow-based market coupling for cross-border electricity trading

Cited by 33 publications

References 14 publications

Uncertainty-Aware Capacity Allocation in Flow-Based Market Coupling

Uncertainty-Aware Capacity Allocation in Flow-Based Market Coupling

Coordinating Capacity Calculation via Electricity Market Coupling: Insights from the H2020 CROSSBOW Project

Evaluating Policy Implications on the Restrictiveness of Flow-based Market Coupling with High Shares of Intermittent Generation: A Case Study for Central Western Europe

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