Julián Barquín

Natural gas network modeling for power systems reliability studies

The growth of power generation in Spain and several other countries is mainly based on the construction of combined-cycle power plants. As the number of this type of plants increases, the gas and electricity systems are linked together. Therefore, power system reliability studies should consider the gas supply reliability. As a consequence, the new generation of reliability models should take into account the joint operation of electrical and gas systems. This paper presents a model to compute the maximum amount of power that can be supplied by the combined-cycle power plants in a system. The gas network is modeled. The effect of compressors to enlarge the transmission capacity of the network is included. The developed model will be integrated into a higher level model that analyzes the joint reliability of the electrical and gas systems. A case study based on the Belgian high-calorific gas network is analyzed.

Generation Capacity Expansion in Liberalized Electricity Markets: A Stochastic MPEC Approach

This paper proposes a bilevel model to assist a generation company in making its long-term generation capacity investment decisions considering uncertainty regarding the investments of the other generation companies. The bilevel formulation allows for the uncoupling of investment and generation decisions, as investment decisions of the single investing generation company are taken in the upper level with the objective to maximize expected profits and generation decisions by all companies are considered in the lower level. The lower level represents the oligopolistic market equilibrium via a conjectured-price response formulation, which can capture various degrees of strategic market behavior like perfect competition, the Cournot oligopoly, and intermediate cases.

Capacity Expansion Equilibria in Liberalized Electricity Markets: An EPEC Approach

This paper presents a novel way to model the generation capacity expansion problem in a liberalized framework via a multi-year bilevel equilibrium model. In the upper level the competing generation companies maximize their individual profits, while the lower level represents the market using a conjectured-price response approach, which allows us to vary the strategic spot market behavior, to see how much the reigning competitive behavior impacts investment decisions. The bilevel equilibrium model is formulated as an equilibrium problem with equilibrium constraints, transformed into a mixed integer linear program and solved as such using diagonalization in order to verify equilibria. We present a case study to apply this new modeling approach and to demonstrate that the proposed equilibrium problem with equilibrium constraints can have multiple solutions whose respective investments can vary.

Cournot Equilibrium Calculation in Power Networks: An Optimization Approach With Price Response Computation

Since deregulated power markets are very often oligopolistic ones, efficient models that are able to describe strategic behavior of firms must be developed. In particular, transmission constraints can easily increase the opportunities of market players to exercise market power. This paper presents a model that describes the firms strategic interaction, based on Nash-Cournot equilibrium, when the power network is taken into account. Specifically, this paper introduces a new iterative algorithm, that explicitly considers how the production at a certain bus affects the whole network, and consequently models the opportunities for the firms of exercising market power, taking into account their ability to influence the composition of the set of constrained lines. The theoretical basis of the method as well as a case study based on the Central European network is included.

Open versus closed loop capacity equilibria in electricity markets under perfect and oligopolistic competition

We consider two game-theoretic models of the generation capacity expansion problem in liberalized electricity markets. The first is an open loop equilibrium model, where generation companies simultaneously choose capacities and quantities to maximize their individual profit. The second is a closed loop model, in which companies first choose capacities maximizing their profit anticipating the market equilibrium outcomes in the second stage. The latter problem is an equilibrium problem with equilibrium constraints. In both models, the intensity of competition among producers in the energy market is frequently represented using conjectural variations. Considering one load period, we show that for any choice of conjectural variations ranging from perfect competition to Cournot, the closed loop equilibrium coincides with the Cournot open loop equilibrium, thereby obtaining a ‘Kreps and Scheinkman’-like result and extending it to arbitrary strategic behavior. When expanding the model framework to multiple load periods, the closed loop equilibria for different conjectural variations can diverge from each other and from open loop equilibria. We also present and analyze alternative conjectured price response models with switching conjectures. Surprisingly, the rank ordering of the closed loop equilibria in terms of consumer surplus and market efficiency (as measured by total social welfare) is ambiguous. Thus, regulatory approaches that force marginal cost-based bidding in spot markets may diminish market efficiency and consumer welfare by dampening incentives for investment. We also show that the closed loop capacity yielded by a conjectured price response second stage competition can be less or equal to the closed loop Cournot capacity, and that the former capacity cannot exceed the latter when there are symmetric agents and two load periods.

Under-relaxed iterative procedure for feasible short-term scheduling of a hydro chain

This paper presents a method for short-term hydro scheduling. The objective is to determine a feasible operation of a set of coupled hydro units, fulfilling the aggregate requirements obtained from a higher-level hydrothermal coordination tool. In order to take into account the nonlinear relationship among the electrical power, the net head and the turbine water discharge, an under-relaxed iterative procedure is proposed. The performance of this algorithm enhances previous research works as possible diverging oscillations are damped in order to reach the convergence. Therefore, the net heads used to build the power/discharge curves of the head dependent units are determined using previous iterations results. This way, each stage can be solved by means of a MILP optimization problem where binary variables allow modeling the discrete hydro unit-commitment decisions. The process finishes when the maximum gap between the reservoir levels of two consecutive iterations satisfies the convergence tolerance. A case study is also presented to show its application to a real size hydro chain.

Coordination between medium-term generation planning and short-term operation in electricity markets

This paper analyzes the coordination between medium-term generation planning and short-term operation in electricity markets. This coordination is particularly important from a practical point of view in order to guarantee that certain aspects of the operation that arise in the medium-term level are explicitly taken into account: limited-energy resources and obligatory-use resources. Three different approaches are proposed in order to guarantee that short-term decisions made by a generation company are consistent with its operation objectives formulated from a medium-term perspective. These approaches make use of technical and economic signals to coordinate both time scopes: primal information, dual information, and resource-valuation functions. This paper presents the main advantages and drawbacks of the three approaches and applies them to a case study that uses a conjectural-variation-based representation of the market.

Stochastic Market Equilibrium Model For Generation Planning

It is widely accepted that medium-term generation planning can be advantageously modeled through market equilibrium representation. There exist several methods to define and solve this kind of equilibrium in a deterministic way. Medium-term planning is strongly affected by uncertainty in market and system conditions, thus extensions of these models are commonly required. The main variables that should be considered as subject to uncertainty include hydro conditions, demand, generating units failures and fuel prices. This paper presents a model to represent medium-term operation of electrical market that introduces this uncertainty in the formulation in a natural and practical way. Utilities are explicitly considered to be intending to maximize their expected profits and biddings are represented by means of a conjectural variation. Market equilibrium conditions are introduced by means of the optimality conditions of a problem, which has a structure that strongly resembles classical optimization of hydrothermal coordination. A tree-based representation to include stochastic variables and a model based on it are introduced. This approach for market representation provides three main advantages: robust decisions are obtained; technical constraints are included in the problem in a natural way, additionally obtaining dual information; and big size problems representing real systems in detail can be addressed.

European balancing markets

Balancing markets are critical for the operation of power systems. TSOs use these markets for the acquisition of the resources needed for the balance between generation and demand on real-time (minute-to-minute operation). Balancing markets, since their beginning, were conceived to cope with real-time operation issues such as forecast errors on generation/demand and unplanned power outages due to a fault on generation units or transmission facility. Today, balancing markets are facing new challenges. One of them is the incorporation of a considerable amount of intermittent renewable generation on the generation mix, which could impose an increase on the volumes traded on balancing markets in order to ensure the correct performance of the system. Another issue is the tendency of displacing national energy markets by regional markets within which multi-area Day-Ahead trading is managed. This article presents the current designs of several European balancing markets, i.e. The Belgian, Swiss, German, Danish, Spanish, French, Italian and Dutch balancing markets. Since control reserves vary from one system to another, this article first presents a classification of the control reserves used within the surveyed systems. From the classification we proceed to the comparison of the assessment, remuneration (methods and structure), and cost recovery for secondary and tertiary reserves applied by each TSO.

Economic Assessment of the Participation of Wind Generation in the Secondary Regulation Market

The aim of this paper is to analyze the profitability of wind technology as a potential participant in the frequency regulation, specifically in the secondary regulation market. The study is conducted for the Spanish system using existing market rules. However, although this system has some peculiarities the main methodology could be applied in other systems. Firstly, a bibliographical review of the relevant technical possibilities of this technology is carried out. Then, a simulation study based on real data is conducted in order to evaluate the maximum possible incomes. Later, a specific offer strategy is proposed and the income is estimated based on statistical modeling and checked by simulating its performance using the actual and forecasted productions of a wind portfolio. It is concluded that under the current generation structure and regulatory framework in the Spanish system, the incomes obtained from the participation of wind technology would be modest. However, secondary regulation by wind generators might facilitate higher penetration levels of this technology. In the long term, with expected wind generation subsidies much reduced, a greater need for regulation reserves and a possible increase in regulation prices, regulation-related incomes might become a sizeable fraction of the total income of wind generators.