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“…So far, few studies have addressed the optimal zonal delimitation of the German or European power market (e.g. [16, 32, 33] or [34]). However, this paper does not aim at finding the optimal delimitation of alternative bidding zones, but rather aims at analysing the impacts of RES generation and demand patterns on NTCs for a fictitious yet appropriate splitting of the German power market and the resulting implications for market splitting in a power system with a high share of RES.…”
Section: Resultsmentioning
confidence: 99%
“…Although the adequate configuration of bidding zones and NTCs is of major importance for the effectiveness of market splitting, further issues arise when introducing zonal pricing. So far, few studies have addressed the market implications and distributional effects of market splitting in Germany (compare [5, 34, 35]). Accordingly, the introduction of further bidding zones in Germany would affect the spot market results.…”
Section: Resultsmentioning
confidence: 99%
“…Thus, when the NTC becomes binding spot prices are higher in the South. In [34], the average annual electricity price differential is 1.70 €/MWh (2015). In [5], an average annual price difference of 1.40 €/MWh (2020) is found.…”
For the further development of an integrated European electricity market, congestion management mechanisms are one of the major market design issues. Against the background of increasing generation from renewables and resulting congestions, an efficient management of network congestions is gaining importance especially in Germany. Introducing nodal pricing as the first best mechanism is not considered to be realistic for Germany in the nearby future. Yet the splitting of the German electricity market into several market zones will also improve congestion management. A key issue in the so-called market splitting is the determination of the net transfer capacity (NTC) between the market zones as it determines the effectiveness of market splitting as congestion management mechanism. The authors therefore propose an integrated approach to incorporate the effects of renewables feed-in, load patterns and cross-border flows on NTCs. On the basis of results of a European power market model they specify typical hours using a clustering approach. Subsequently, a DC security constrained optimal power flow model is used to calculate situation-dependent NTCs. They conclude that the obtained NTCs strongly depend on renewables feed-in and that this effect has to be considered when modelling alternative congestion management mechanisms such as market splitting.
“…So far, few studies have addressed the optimal zonal delimitation of the German or European power market (e.g. [16, 32, 33] or [34]). However, this paper does not aim at finding the optimal delimitation of alternative bidding zones, but rather aims at analysing the impacts of RES generation and demand patterns on NTCs for a fictitious yet appropriate splitting of the German power market and the resulting implications for market splitting in a power system with a high share of RES.…”
Section: Resultsmentioning
confidence: 99%
“…Although the adequate configuration of bidding zones and NTCs is of major importance for the effectiveness of market splitting, further issues arise when introducing zonal pricing. So far, few studies have addressed the market implications and distributional effects of market splitting in Germany (compare [5, 34, 35]). Accordingly, the introduction of further bidding zones in Germany would affect the spot market results.…”
Section: Resultsmentioning
confidence: 99%
“…Thus, when the NTC becomes binding spot prices are higher in the South. In [34], the average annual electricity price differential is 1.70 €/MWh (2015). In [5], an average annual price difference of 1.40 €/MWh (2020) is found.…”
For the further development of an integrated European electricity market, congestion management mechanisms are one of the major market design issues. Against the background of increasing generation from renewables and resulting congestions, an efficient management of network congestions is gaining importance especially in Germany. Introducing nodal pricing as the first best mechanism is not considered to be realistic for Germany in the nearby future. Yet the splitting of the German electricity market into several market zones will also improve congestion management. A key issue in the so-called market splitting is the determination of the net transfer capacity (NTC) between the market zones as it determines the effectiveness of market splitting as congestion management mechanism. The authors therefore propose an integrated approach to incorporate the effects of renewables feed-in, load patterns and cross-border flows on NTCs. On the basis of results of a European power market model they specify typical hours using a clustering approach. Subsequently, a DC security constrained optimal power flow model is used to calculate situation-dependent NTCs. They conclude that the obtained NTCs strongly depend on renewables feed-in and that this effect has to be considered when modelling alternative congestion management mechanisms such as market splitting.
“… The first one relates to exogenously given configurations. In both (Trepper et al, 2015) and (Egerer et al, 2016) the authors split Germany into two PZs, a Northern and Southern zone. Both studies show that RD amounts can be reduced while price spreads between the two zones, except for a few hours, remain relatively small.…”
The topic of alternative price zone configurations is frequently discussed in Central Western Europe where-so far-national borders coincide with borders of price zones. Reconfiguring these price zones is one option in order to improve congestion management, foster trading across borders of price zones and, thus, to increase welfare. In view of the significant increase in redispatch volumes and costs over the last years due to increasing feed-in from renewable energy sources in conjunction with delayed grid expansion, this topic has gained in importance. To determine these improved price zone configurations for a large-scale system like Central Western Europe, often either configurations based on expert guesses are considered or heuristics using approximate criteria like locational marginal prices are used to obtain price zones through clustering. In contrast, the present paper formulates a bi-level optimization problem of how to determine optimal configurations in terms of system costs and-given the size and nature of the problem-solves it with a specially developed genetic algorithm. Resulting price zone configurations are compared to both exogenously given, expert-based price zone configurations from the Entso-E bidding zone study and endogenously assessed configurations from a hierarchical cluster algorithm. Results show that the genetic algorithm achieves best results in terms of system costs. Moreover, the comparison with solutions from a hierarchical cluster analysis reveals important drawbacks of the latter methodology.
“…Capacity mechanisms can help to safeguard the security of electricity supply, but they must be designed so as to avoid distortions of competition in energy markets. A lack of appropriate mechanisms and regulations in the long term may lead to an inevitable market zone split [41]. The experience of the German power market is therefore important for all EU countries.…”
The power sector is currently experiencing a dynamic transformation, resulting not only from EU directives, but also from current problems, mainly related to ensuring energy security for customers. For this reason, in Poland, it was decided that the model of electricity market operation needed to be changed. A dual market has been created, and a separated segment is the capacity market. This solution operates, in addition to other power mechanisms, in many European Union countries, e.g., in France, Great Britain, and Italy. The experience of these countries indicates the positive impact of the power market on various aspects of the power sector, such as legal, economic, technical and technological, social, and infrastructural aspects, mainly due to technological neutrality and open competition between power suppliers. The creation of the structure of an energy market drastically changes the rules of energy management, which requires investigations concerning the impact of those factors on the energy sector in Poland. The aim of this work is to examine the impact of the power market on the Polish power sector, and to determine the impact of individual consequences on several predefined areas. For this purpose, a questionnaire survey was used. The purpose of a detailed analysis is to develop probable scenarios for the sustainable development of the Polish energy sector.
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