Price-Region Bids in Electricity Markets

Lucien Ali Bobo, Lesia Marie-Jeanne Mariane Mitridati, Josh A. Taylor, Pierre Pinson, Jalal Kazempour

Research output: Contribution to journalJournal articleResearchpeer-review

Abstract

Current bid formats in pool-based electricity markets are ill-equipped to accommodate the broad range of non-conventional sources of flexibility, such as demand response and interconnected heating, natural gas and water infrastructure networks. To address this issue, this paper introduces the
novel price-region bid format to be used in both forward electricity markets and financial right auctions. We show that price-region bids are able to accommodate a broad range of techno-economic characteristics, including complex spatial and temporal couplings, and facilitate market access to
non-conventional flexibility providers. We then show that this new bid format is compatible with existing market structures, and satisfies desirable market properties under common assumptions. Three numerical studies are provided: two motivating examples based on a district heating utility
and a cascaded hydro power plant, and a case study based on an integrated power and heat system. These studies illustrate the inability of existing bid formats to accommodate flexible resources, and show how price-region bids overcome this shortcoming.
Original languageEnglish
JournalEuropean Journal of Operational Research
Number of pages37
ISSN0377-2217
Publication statusAccepted/In press - 2021

Keywords

  • OR in energy
  • Electricity markets
  • Power system flexibility
  • Price-region bids

Fingerprint

Dive into the research topics of 'Price-Region Bids in Electricity Markets'. Together they form a unique fingerprint.

Cite this