Towards electricity markets accommodating uncertain offers

Athanasios Papakonstantinou; Pierre Pinson

Towards electricity markets accommodating uncertain offers

Athanasios Papakonstantinou, Pierre Pinson

Research output: Chapter in Book/Report/Conference proceeding › Article in proceedings › Research › peer-review

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Abstract

The use of renewable energy sources of energy and in particular wind and solar has been on the rise over the last decades with plans to increase it even more. Such developments introduce significant challenges in existing power systems and can result in high electricity prices and costly infrastructure investments. In this paper we propose a new electricity market mechanism whereby the uncertain and dynamic nature of wind power and other stochastic sources is embedded in the market mechanism itself, by modelling producers’ bids as probabilistic estimates. An extension on the bilevel programming formulation of an electricity market, based on the Continuous Ranked Probability Score (CRPS) reduces the impact of poor estimates for both the stochastic producers and the system operator. We introduce a simulation setting which first demonstrates that impact and then proceed to illustrate the main features our market setup and compare it with a conventional electricity market and a standard bilevel setup.

Original language	English
Title of host publication	2014 Proceedings of 13th International Workshop on Large-Scale Integration of Wind Power and Transmission Networks
Number of pages	6
Publisher	IEEE Press
Publication date	2014
ISBN (Print)	978-3-98 13870-9-4
Publication status	Published - 2014
Event	13th International Workshop on Large-Scale Integration of Wind Power into Power Systems as well as on Transmission Networks for Offshore Wind Plants - Berlin, Germany Duration: 11 Nov 2014 → 13 Nov 2014

Conference

Conference	13th International Workshop on Large-Scale Integration of Wind Power into Power Systems as well as on Transmission Networks for Offshore Wind Plants
Country	Germany
City	Berlin
Period	11/11/2014 → 13/11/2014

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Paper wiw2014 athpapAccepted author manuscript, 438 KB

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1 Conference presentations

13th International Workshop on Large-Scale Integration of Wind Power into Power Systems as well as on Transmission Networks for Offshore Wind Power (WIW 2014)
Athanasios Papakonstantinou (Speaker)
11 Nov 2014 → 13 Nov 2014
Activity: Talks and presentations › Conference presentations

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@inproceedings{2777b78145b64733a6331025dd61a1a9,

title = "Towards electricity markets accommodating uncertain offers",

abstract = "The use of renewable energy sources of energy and in particular wind and solar has been on the rise over the last decades with plans to increase it even more. Such developments introduce significant challenges in existing power systems and can result in high electricity prices and costly infrastructure investments. In this paper we propose a new electricity market mechanism whereby the uncertain and dynamic nature of wind power and other stochastic sources is embedded in the market mechanism itself, by modelling producers{\textquoteright} bids as probabilistic estimates. An extension on the bilevel programming formulation of an electricity market, based on the Continuous Ranked Probability Score (CRPS) reduces the impact of poor estimates for both the stochastic producers and the system operator. We introduce a simulation setting which first demonstrates that impact and then proceed to illustrate the main features our market setup and compare it with a conventional electricity market and a standard bilevel setup. ",

author = "Athanasios Papakonstantinou and Pierre Pinson",

year = "2014",

language = "English",

isbn = "978-3-98 13870-9-4",

booktitle = "2014 Proceedings of 13th International Workshop on Large-Scale Integration of Wind Power and Transmission Networks",

publisher = "IEEE Press",

note = "13th International Workshop on Large-Scale Integration of Wind Power into Power Systems as well as on Transmission Networks for Offshore Wind Plants ; Conference date: 11-11-2014 Through 13-11-2014",

}

Papakonstantinou, A & Pinson, P 2014, Towards electricity markets accommodating uncertain offers. in 2014 Proceedings of 13th International Workshop on Large-Scale Integration of Wind Power and Transmission Networks. IEEE Press, 13th International Workshop on Large-Scale Integration of Wind Power into Power Systems as well as on Transmission Networks for Offshore Wind Plants, Berlin, Germany, 11/11/2014.

TY - GEN

T1 - Towards electricity markets accommodating uncertain offers

AU - Papakonstantinou, Athanasios

AU - Pinson, Pierre

PY - 2014

Y1 - 2014

N2 - The use of renewable energy sources of energy and in particular wind and solar has been on the rise over the last decades with plans to increase it even more. Such developments introduce significant challenges in existing power systems and can result in high electricity prices and costly infrastructure investments. In this paper we propose a new electricity market mechanism whereby the uncertain and dynamic nature of wind power and other stochastic sources is embedded in the market mechanism itself, by modelling producers’ bids as probabilistic estimates. An extension on the bilevel programming formulation of an electricity market, based on the Continuous Ranked Probability Score (CRPS) reduces the impact of poor estimates for both the stochastic producers and the system operator. We introduce a simulation setting which first demonstrates that impact and then proceed to illustrate the main features our market setup and compare it with a conventional electricity market and a standard bilevel setup.

AB - The use of renewable energy sources of energy and in particular wind and solar has been on the rise over the last decades with plans to increase it even more. Such developments introduce significant challenges in existing power systems and can result in high electricity prices and costly infrastructure investments. In this paper we propose a new electricity market mechanism whereby the uncertain and dynamic nature of wind power and other stochastic sources is embedded in the market mechanism itself, by modelling producers’ bids as probabilistic estimates. An extension on the bilevel programming formulation of an electricity market, based on the Continuous Ranked Probability Score (CRPS) reduces the impact of poor estimates for both the stochastic producers and the system operator. We introduce a simulation setting which first demonstrates that impact and then proceed to illustrate the main features our market setup and compare it with a conventional electricity market and a standard bilevel setup.

M3 - Article in proceedings

SN - 978-3-98 13870-9-4

BT - 2014 Proceedings of 13th International Workshop on Large-Scale Integration of Wind Power and Transmission Networks

PB - IEEE Press

T2 - 13th International Workshop on Large-Scale Integration of Wind Power into Power Systems as well as on Transmission Networks for Offshore Wind Plants

Y2 - 11 November 2014 through 13 November 2014

ER -

Towards electricity markets accommodating uncertain offers

Abstract

Conference

Access to Document

13th International Workshop on Large-Scale Integration of Wind Power into Power Systems as well as on Transmission Networks for Offshore Wind Power (WIW 2014)

Cite this