flexibility operation in nordic demand response markets · 2015. 12. 11. · flexibility operation...
TRANSCRIPT
Flexibility Operation in Nordic
Demand Response Markets
Jan Segerstam 4.12.2015, IDE4L Seminar Tampere
Director R&D, Empower IM Oy
• What is the role of the current energy
system that connects energy resources
and acts as the base for liberalized energy
markets?
• What do we face in transition and what do
we need when future energy resources
take over?
11.12.2015 Jan Segerstam 2
The Energy System –
Flexibility or Rigid Structures?
• Emissions
• Current emission levels are not sustainable
• Resource dependency vs. self-sufficiency
• Local resources do not get used
• Large networks are needed to distribute and operate resources
• Generation technology
• New resources with smaller ecological footprint
• Control technology
• Resource use can be optimized in real time
• Management system technology
• Large amounts of information can be aggregated and managed
easily
11.12.2015 Jan Segerstam 3
Change Drivers in the
Energy System
• An electricity network can only function
correctly if it is in balance
• Consumption and production are equal at all
times
• Otherwise physical characteristics like
frequency and voltage change
• When physical delivery limits are not met,
the network shuts down
11.12.2015 Jan Segerstam 4
Basic Technical Balance
Requirements
• A trade can only be consummated if
• The quantity and price has been agreed
• The delivery is according to the quantity and
price
• When any of these are changed, the trade
is no longer valid
• The party responsible for the trade needs to
be able to control the components of the trade
11.12.2015 Jan Segerstam 5
Basic Commercial Balance
Requirements
• The role of electricity markets is to
facilitate electricity trading between
partners
• The structure is designed to create balance in
order to allow physical delivery to happen
• The tradable commodity should have
• Value to the end customer
• Properties that allow for safe and reliable
delivery 11.12.2015 Jan Segerstam 6
Markets as facilitators
11.12.2015 Jan Segerstam 7
A Simplified Energy System
Mete-
ring
point
Con
sum
ption
Mete-
ring
point
Pro-
ducti
on
Trans
missio
n
Distrib
ution
11.12.2015 Jan Segerstam 8
The Energy System Today
DSO
TSO
Sup-
plier
Pro-
du-
cer
Mar-
kets
Pro-
duction
Con-
sump-
tion
Physical network connection
Contractual relationship
11.12.2015 Jan Segerstam 9
System parts in the future
Mete-
ring
point
Pro-
ducti
on
Con
sum
ption
Veh.
cons
umpt
ion
Veh.
stora
ge
Ve-
hicle
Sto-
rage
Mete-
ring
point
Pro-
ducti
on
Con
sum
ption
Mete-
ring
point
Con
sum
ption
Mete-
ring
point
Pro-
ducti
on
Trans-
mis-
sion
Distri-
bution
Micro-
grid
Sto-
rage
Future DSO Network Vision
Source: TUT
Flexible Resource Optimization
Source: LUT
• One market area over four countries
• All physical connections are 100% market
controlled by implicit auction
• Price areas manage physical constraints
• Financial CfD products provide protection for area
price volatility
11.12.2015 Author 12
Nordic Market Structure
11.12.2015 Author 13
Nordic Market Levels
Financial market
• Open trading of single bids (bid/ask)
• Financial settlement against day ahead price
Day ahead market
• One time bid for every trading unit (hour)
• Physical delivery
Intraday market
• Open trading of single bids (bid/ask)
Regulating power market
• One time bid for every trading unit (hour)
• Day-ahead price defaults
Balancing power market
• Enforced
• Uses regulating power prices
Retail
datahub
(National
FI, SWE,
NO, DK)
DSO
DSO
DSO
ECS
P
(BR)
Supp
lier
(BR)
Supp
lier
(BR)
M
P
C M
P
M
P
M
P
M
P C
C
C
M
P
M
P
Whole-
sale hub
(NBS
sSett) TSO
C Customer
MP (blue) an official DSO metering point
MP (orange) a microgrid MP or submetered pt.
DSO Distribution System Operator
TSO Transmission System Operator
BR Balance Responsible
ECSP Energy Community Service Provider
Hub Market Facilitation in the
Nordic Energy Market
Markets are converging into hub enabled and marketplace driven models
Energy Community Service Providers serve Microgrids and traditional customers
Markets (Nordpool,
NASDAQ,
TSO issued
markets)
M
P
C
• Flexibility is the new commodity of electricity
markets • Electricity Markets and grids require constant balance to operate properly
• The marginal cost of new renewable resources is zero, creating a value for any
operational energy flow without any control incentive
• The specific characteristics of electricity
distribution create a value for flexibility in supply
and consumption • Renewables and their support schemes create an intermittent influx of energy
into the market and the grids
• Flexibility needs to be aggregated, operated and traded upon to achieve a
working electricity market
Flexibility, why and what?
Flexibility Operation
D Device/Resource
RM Resource Manager
FO Flexibility Operator
RM
D
D
D
R
M
R
M
FO
RM RM
D
D
D
R
M
R
M
Flexibility Operation is the
management of different
flexible resources (loads,
production, storage) on
multiple aggregation levels
and bringing their capabilities
in aggregate to market
participants
Flexibility Operation is not
trading energy or assuming
balance responsibility
DSO
Supp
lier
(BR) Flex
Op.
M
P
EC
SP
(BR)
M
P
C
D
Ch.
Op.
(BR)
Retail
datahub
Flexibility Operation in an Energy
Market Environment
Market participants
trade on the market
Creating the interface for
flexible resources
TSO
Markets
Flexible products
and flexible offer
structures
CD Control Device
MP blue, an official DSO metering point
MP orange, a community submetering point
DSO Distribution System Operator
TSO Transmission System Operator
BR Balance Responsible
ECSP Energy Community Service provider
ChOp Charging Operator
• Allows smooth entry and exit of all energy
• Allows free transactions between all parties
• Opens up new topologies in connecting
resources
• Leverages the value of flexibility
• Facilitates safe and reliable delivery of electricity
between parties
• Makes use of and encourages new technologies
11.12.2015 Jan Segerstam 18
The Future Flexible Energy System
Empower IM
Your partner in the
Future Energy System
Jan Segerstam
+358-44-4252218
Thank You for your attention