Redefining the merit order of stochastic generation in forward markets.

Juan Miguel Morales González, Marco Zugno, Salvador Pineda Morente, Pierre Pinson

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Abstract

This letter proposes a new merit order for the dispatch of stochastic production in forward markets (e.g., dayahead markets). The proposed merit order considers not only the marginal cost of the stochastic generating unit, which is often very low or zero, but also the projected cost of balancing its energy deviations during the real-time operation of the power system.We show, through an illustrative example, that the proposed merit order leads to increased market efficiency as the penetration of stochastic generation in the electricity market grows.
Original languageEnglish
JournalIEEE Transactions on Power Systems
Volume29
Issue number2
Pages (from-to)992-993
ISSN0885-8950
Publication statusPublished - 2014

Keywords

  • Merit order
  • Renewable energy
  • Stochastic generation
  • Stochastic programming
  • Bilevel programming

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