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Flow-based Allocations

Flow-based Allocations. Mini Forum Central Western REM June 20 th , 2006. path #1. path #2. Pursuing the Optimum. Two Paths. When dealing regional capacity allocations, a maximised social welfare can be reached through two different paths: market coupling first (sharing energy bids)

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Flow-based Allocations

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  1. Flow-based Allocations Mini Forum Central Western REM June 20th, 2006

  2. path #1 path #2 Pursuing the Optimum. Two Paths • When dealing regional capacity allocations, a maximised social welfare can be reached through two different paths: • market coupling first (sharing energy bids) • flow-based modelling first (optimal use of the system) Sharing bids Grid models

  3. ETSO Vision on Achieving the Optimum • Effective and timely use of available data by TSOs, including • regulatory and market frameworks which facilitate free and confidential data exchanges • access to relevant data from market participants • efficient data exchanges between TSOs • Progressive development of the ETSO regional flow-based transmission model

  4. What is the Flow-Based Model? • An improvement of the NTC/profiles concepts, supporting • regional auctions (explicit or implicit), complying with new CM Guidelines • a highly meshed grid • Elaborated by TSOs, based on a reference state of the power system

  5. What is the Flow-Based Model? cont. • Adding more accuracy (=security) • preserving the zonal/hub model • reducing the impact of wrong predictions • increased but moderate volume of data to be exchanged by TSOs • Step-by-step implementation possible • technical dry-run implementation • decentralised / centralised

  6. flow-based C Security domain Coordinated ATC assessment max(A=>B+A=>C) 170 160 A B Coordinated Technical profiles assessment 100 Theoretical Comparison of Models • Flow based modeling maximises the security domain allowing for more cross-border trade opportunities

  7. Heading for Some Cultural Changes? • Reaching the limits of TSO subsidiarity • Political will and compatible regulatory frameworks are both required • supporting free and confidential exchange of data between TSOs • supporting a single set of regional capacity allocation Rules • Using a regional flow-based transmission model means that… • all capacity (explicit) or energy (implicit) bids are simultaneously cleared • the market will find its most efficient XB trades by itself • no more sub-optimal ex-ante sharing of fixed NTCs • congestion income is shared on a regional basis

  8. What Roadmap for the Region? • Integrating the national wholesale markets in this region should be seen as the priority • Central Western REM > 50 % of the IEM • interconnected to all other REMs • Local initiatives should always be supported • implementation of market based mechanisms since end of 2005 on all interconnections • implementation of Trilateral Market Coupling in 2006

  9. What Roadmap for the Region? cont. • A common regional allocation of capacities through the integration of all spot markets as the natural next step in the region …and beyond! • Aiming at the optimum thanks to the development of an underlying flow-based transmission model as the final target

  10. ETSO ‘Flow-based’ Publications • ‘List of data European TSOs need to pursue optimal use of the existing transmission infrastructure’, December 2005 • ‘FMC-Flow-based Market Coupling’, September 2004 • ‘Cross-Border Electricity Exchanges in Meshed AC Power Systems’, April 2004 • ‘Coordinated Congestion Management, an ETSO Vision’, April 2002 www.etso-net.org

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