HTSO
Download
1 / 23

HTSO - PowerPoint PPT Presentation


  • 90 Views
  • Uploaded on

HTSO.

loader
I am the owner, or an agent authorized to act on behalf of the owner, of the copyrighted work described.
capcha
Download Presentation

PowerPoint Slideshow about ' HTSO' - manon


An Image/Link below is provided (as is) to download presentation

Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author.While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server.


- - - - - - - - - - - - - - - - - - - - - - - - - - E N D - - - - - - - - - - - - - - - - - - - - - - - - - -
Presentation Transcript

HTSO

Legal Framework, Investment Opportunities and Technical Innovation in the Electricity SectorSecurity of Supply through competitive markets:Design of the regulatory and economic environment for infrastructure developmentDr. Evangelos LekatsasChairman of the Board of Directors, HTSOAthens, October 23rd 2009


Reliability of Supply

"the degree to which

the performance of the elements of the technical system results in power being delivered to consumers within

accepted standards and in the amount desired”

Security

Adequacy


Security vs Adequacy

  • Security:The ability of the System to withstand disturbances

  • Protection devices

  • Security constrained dispatch

  • Ancillary services (voltage control, AGC, spinning

  • reserves etc.)

  • NOTE: Security is centrally managed but the resources

  • can be procured competitively through ancillary service markets or long term contracts (Public good)


Security vs Adequacy (continued)

  • Adequacy: The ability of the System to meet the aggregate power & energy requirements of all consumers at all times

  • Ability to meet demand on longer time scale basis

  • Non storability of power

  • Long lead time for capacity expansion

  • NOTE: Adequacy provision is nothing more than insurance against shortages


Generation adequacy i
Generation Adequacy(I)

  • Energy only markets:

    Consumers and suppliers interact through unrestricted energy spot markets. Market energy prices provide price signals and compensation for capacity investment. Technology mix and generation capacity are determined by entry and exit of suppliers and by customer choice of desired price risk. Energy only markets result in extreme spike prices. As a remedy to this Capacity Markets have been introduced to avoid price volatility. The purpose of these markets is to ensure that there is sufficient capacity in the System to cover peak demand and at the same time avoid price volatility.


Generation adequacy ii
Generation Adequacy(II)

  • Installed Capacity (Icap) Obligation markets :

    In an ICap market Installed Capacity Obligations are set for Load Representatives (or Suppliers, or Load Serving Entities= LSEs) .Suppliers are obliged to secure contracts with producers sufficient to meet their expected load for one year, plus a security excess that reflects a prescribed Capacity Margin. Producers in order to enter into Agreements with Suppliers are obliged to have sufficient capacity by issuing, for each MW, annual Capacity Availability Certificates (CACs) when commissioning new generating capacity. This method does not provide any signal to the Consumers.


Generation adequacy iii
Generation Adequacy(III)

  • Capacitive Charge

    To incentivize investment in new power plants and availability Generators receive, in addition to SMP, a Capacity Charge (CC) based on availability, as expressed by the calculated Loss Of Load Probability (LOLP), and the Value of Lost Load (VLL).

    P=SMP + CC = SMP+LOLP*{VLL-SMP}

    This method was initially applied in UK. It is not a market but a mechanism. It was abandoned when it was proved that some generators could artificially increase LOLP by withdrawing some of their units.


HTSO

The Value of Lost Load

VLL = 5000 €/MWh


Load Variations: Summer 2007- January 2009

10,0k


Load Curve: Oct 1st 2006 –Sept 30th 2007

Peak Detail in next slide


LOAD DURATION CURVE (period 1.10.2006 -30.9.2007)

Peak Details above 10000MW

11000

10900

To supply the 1000MW of the peak an

investment of 1000MW*400000 €/MW

=400 million €

which amounts to 56 million €/year

or to 56000000/7300 =7671 €/MWh

Adding the fuel cost of an open cycle

Gas Turbine 112 €/MWh we obtain a

total cost of the peak MWh equal to

b=7783 €/MWh

7300MWh/year

10800

10700

10600

10500

LOAD inMW

10400

10300

10200

10100

10000

9900

9800

0

10

20

30

40

50

Hours


Recovery of Fixed and Variable Generation Costs

HTSO

(€/year)

(€/MWh)

fc=fixed cost in €/MW-year

vc=variable cost in €/MWh

Q= installed capacity in MW

E= annual energy generation in MWh/year

b= energy market price in €/MWh

r= capacity payments price in €/MW-year

12


Recovery of Fixed and Variable Generation Costs

( Case I: Energy only Market, r =0)

HTSO

(€/year)

(€/MWh)

fc=56000 €/MW-year

vc=112 €/MWh

Q= 1000 MW

E= 7300 MWh

b= 7783 €/MWh > VLL=5000 €/MWh

Decision= Curtail Peak 1000MW !!!!!

13


Recovery of Fixed and Variable Generation Costs

( Case II: Energy + Capacity Market, r ≠ 0)

HTSO

(€/year)

(€/MWh)

fc=56000 €/MW-year

vc=112 €/MWh

Q= 1000 MW

E= 7300 MWh

r=35000 €/MW-year

b= 2989 €/MWh < VLL=5000 €/MWh

Value b of energy is still unacceptable (high)

Introduce a CAP such that b< CAP

14


Recovery of Fixed and Variable Generation Costs

( Case III: Capped Energy + Capacity Market)

HTSO

(€/year)

(€/MWh)

fc=56000 €/MW-year

vc=112 €/MWh

Q= 1000 MW

E= 7300 MWh

CAP= 150 €/MWh

r>50941.8 €/MW-year

b<CAP=150 €/MWh

15


LOADDURATION CURVE (period 1.10.2006 -30.9.2007)

Peak Details above 9000MW

11000

A similar calculation for the zone of 1000 MW between 9000 and 10000 MW

Taking into account that the annual energy now is 133110 MWh/year gives

7300MWh/year

133110MWh/έτος

10500

56 εκ.€/year/133110MWh/year=420,7€/MWh

10000

Adding the fuel cost, 112€/MWh, we conclude

that the total cost in this lower peak zone is

Load in MW

b=532,7 €/MWh

9500

9000

8500

0

20

40

60

80

100

120

140

160

180

200

220

240

260

280

300

Hours



  • Non Priced Bids (NPB)

  • Mandatory Hydro ~1800MW

  • RES ~ 300MW

  • Technical Min ~3000MW

  • Imports ~ 700MW

  • TOTAL= 5800MW

€/MWh

NPD = Non Priced Demand

CAP

With L1>L0 SMP1<SMP0

SMP0

SMP1

Demand Curve

Supply Curve

NPBο

MW

L0

L1

L, System Load, MW

NPB1

Right shift of the Supply Curve due to increase of NPB



EPILOGUE

The market expresses the will of human beings to meet at the point of equilibrium of supply with demand by maximizing the, so called, Social Surplus. But the will of human beings, especially when expressed in terms of conflicting economic interests, may lead the power system to risky levels of operation. Indeed, following the liberalisation over the past 2 decades, some power systems have been pushed towards their stability limits in order to maximize profit in energy trading, thus endangering the operation of the power system. It is very important to understand that power systems must operate within safe physical limits and with adequate reserves in order to maintain high standards of supply. This creates a cost we must not forget!


HTSO

AcknowledgmentsI would like to thank my colleagues in HTSO for their valuable discussions in preparing this presentation

THANK YOU FOR YOUR ATTENTION


ad