J Jasper Frunt

Assessing the economic benefits of flexible residential load participation in the Dutch day-ahead auction and balancing market

In this paper the authors present the potential cost-savings that may arise due to demand response from residential customers participating in the Amsterdam Power eXchange (APX) day-ahead auction and the Dutch balancing energy market which is organised by TenneT, the Dutch Transmission System Operator (TSO). For this purpose, a model for residential demand response is developed that utilises as input historical market data. Furthermore, the model synthesises a daily load profile based on load profiles of Dutch residential customers and simulated data to represent aggregate demands of domestic appliances and electric vehicles. The model is built around the concept of the aggregator, an envisioned legal entity, that contracts large amounts of residential customers and then coordinates them in real-time under different objectives (i.e. economic optimisation based on predicted day-ahead prices and the provision of balancing energy). Simulation results show that the potential economic benefits of residential demand response, on the Dutch electricity markets, is relatively low on a per household basis, but not negligible for the business case of the aggregator.

Wavelet Decomposition for Power Balancing Analysis

Wavelets are a mathematical tool for analyzing time-varying signals. Unlike conventional frequency analysis methods, wavelets give information about the frequency components as a function of time. Wavelets are applied in situations where there are large discrepancies in the frequencies to be analyzed and when the signal to analyze cannot be assumed periodic. In power systems, wavelets are usually applied to determine power-quality issues. In this paper, however, applying wavelets to analyze fluctuations in load and generation profiles is proposed. As generation and load in any power system must always be balanced, wavelets can be applied to identify the required amount of balancing capacity from observing the time-varying nature of the dominant frequencies contained in the power signals.

Photovoltaic energy in power market

Photovoltaic (PV) penetration in the grid connected power system has been growing. Currently, PV electricity is usually directly sold back to the energy supplier at a fixed price nd subsidy. However, subsidies should always be a temporary policy, and will eventually be terminated. A question is raised whether grid-connected PV generation will be more beneficial by making biddings in power markets than by supplying at a fixed price. An economic model of profit maximization for PV generation when joining power markets is proposed to answer the question. A simplified model is applied to simulate a case study of PV biddings in the Amsterdam Power Exchange (APX) spot market, using PV generation data from a standardized neighborhood PV installation. A Monte Carlo method is used to calculate penalty costs due to over-predicted irradiation. Also a Monte Carlo simulation is applied to survey a number of random imbalance capacities and corresponding prices within a Gaussian distribution by repeating the calculation loop. The sensitivity for prediction errors is examined by simulations with different unpredictability levels of solar irradiation. The outcome of the simulations is a value for the difference between the two revenues of PV generation when joining power markets and when supplying at a fixed price.

Effects of Further Integration of Distributed Generation on the Electricity Market

Environmental concern leads to legislation to stimulate the further integration of renewable energy in the Dutch electricity supply system. Distributed generation is suited for the integration of renewable energy sources. Furthermore it can be used to generate both heat and electricity in a more efficient way using muCHP. Unfortunately, the additional integration of distributed generation has some negative consequences for the organisation of the electricity market. Programme responsible parties have to set up E-programmes which describe trade amongst them. Due to the higher unpredictability and uncontrollability of distributed generation, the E-programmes tend to be less accurate. This results in imbalance between supply and demand of electricity which has to be settled by the transmission system operator. This leads to extra costs for the programme responsible parties which could finally result in a drawback for the integration of renewable energy sources. Therefore market based solutions have to be created.

Analysis of the market-based service provision for operating reserves in the Netherlands

The electricity sector liberalisation in Europe has contributed significantly towards the creation of competitive markets. The wholesale trading of electricity consists of a market-based segment often complemented by markets for ancillary services, including the provision of operating reserves. In this paper, the authors examine and classify operating reserves that are currently traded in the Netherlands. The principles, under which the provision of these reserves is verified by the Dutch Transmission System Operator (TSO), are illustrated, and inefficiencies of the current verification approach are identified. The verification process of the TSO takes into account specific conditions, but the criteria for assessing the quality of the service provision are not explicitly defined. Furthermore, only a limited number of cases can be assessed due to the non-automated nature of the process. Finally, a proposal is made for the development of an automated analysis tool for assessing the service provision of market parties. This proposal emphasises the need for more robust verification processes in line with the increasing integration of electricity markets in Europe.

Participation of distributed generation in balance Management

Distributed generation is not yet considered to participate in balance management in power systems. Low marginal costs and poor predictability make them less attractive for this application. However, further integration of distributed generation will make participation in balance management a necessity both for down regulation as well as up regulation. The potential of different distributed generators to participate in balance management is analysed. Economic and regulatory boundaries are discussed, as well as improvements to create incentives for distributed generators to participate.

Provision of ancillary services for balance management in autonomous networks

The main hypothesis underlying the work presented in this paper is that the future power system will rely on large amounts of distributed generation (DG) with large percentage of renewable energy based sources. Consequently, this system will be characterised by significantly increased uncertainties on generation side and therefore, its behavior in time will be more difficult to control. This paper discusses the current methods for balance management. Furthermore it considers the limitations and presents a novel approach for balance management in a future situation.

Load shifting potential of the washing machine and tumble dryer

Various smart grid pilots are being initiated worldwide to explore the flexibility in electricity demand of households. The potential flexibility of appliances can be unlocked using either manual or (semi-)automated demand response. In the Dutch smart grid pilot Your Energy Moment the effect of demand response is studied. The participating households are equipped with a smart washing machine or smart tumble dryer. These appliances can be used to manually respond to the dynamic tariff applied in the pilot, or cycles can be programmed to automatically respond to price fluctuations. Based on the pilot results, the total load shift of the washing machine and tumble dryer is quantified. Subsequently, the effect of the program function is studied, focusing on the use of this function and on the flexible hours provided for the schedule horizon. The results show that the load of the smart appliances is shifted in time. This load shift is a consequence of both manual and semi-automated load shift. The latter, semi-automated load shift related to the use of the program function, is however limited. Both the measured manual and semi-automated load shift did not change over time, indicating a structural change in behavior.

Case studies and results of the E-Price approach in power systems

This paper presents the simulation results of a model for the validation of market designs and algorithms for power balancing. The simulations were performed as one of the final deliverables of the E-Price project. The market design under simulation includes the introduction of double sided markets for ancillary services for power balancing, in which balance responsible parties have the possibility to hedge their position in terms of energy balance. The model, which includes both day-ahead and real-time decisions, has been exposed to imbalances of three categories. These imbalances are power plant trips, wind power forecasting errors and wind power fluctuations. As such it is evaluated how the proposed power balancing mechanisms perform. The simulations show that the proposed double sided market for ancillary services gives proper incentives to balance responsible parties to minimize their imbalance as well as to provide available resources to the balancing systems in place.

The impact of electricity market design on periodic network frequency excursions

In an electrical power system there must always be a balance between generation and load of electricity. Any mismatch between generation and load will, in a synchronous system, instantaneously lead to a deviation of the grid frequency from its nominal value in the whole system. It is observed that grid frequency deviations occur at hourly and half-hourly transitions, especially during morning and evening hours when the rate of change of load is high. The origin of these frequency deviations lies in the economic dispatch of generation which is ever more cost optimized. As generation companies have the obligation to provide a certain amount of energy per trading period (defined as Program Time Unit), they have little (or no) incentive to follow the power demand profile and therefore rather optimize their generation based on this energy constraint, which results in stepwise power generation profiles. The restructuring of the electricity business is considered a plausible cause for this, as it provides an incentive to further optimize the economic dispatch without taking into account mismatch between generation and load within the program time unit.