# SCED Power Balance Penalty Curve

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SCED Power Balance Penalty Curve
Resmi Surendran

Objective Explain the Power Balance Penalty Curve
Discuss the values for the Power Balance Penalty Curve MW break points Penalty for violation up to the MW break point Not to discuss the optimal mechanism for setting scarcity pricing.

Power Balance Penalty System Lambda is the change in the objective value obtained by relaxing the Power Balance constraint by 1MW Power Balance Penalty is the maximum cost paid for one addition/less MW of generation to meet the Power Balance constraint.

SCED Constraints Power Balance Constraint Transmission constraint
sum (Base Point) + under gen slack – over gen slack = Generation to be dispatched Transmission constraint sum( Shift Factor * Base Point) – violation slack ≤ limit Ramp Limit constraint LDL ≤ Base Point ≤ HDL

SCED Objective Minimize + Cost of dispatching generation
integral (offer cost * MW dispatched) + Penalty for violating Power Balance constraint sum (Penalty cost * violation amount) + Penalty for violating transmission constraint

PB Violation with no Transmission Constraints
Only constraints active will be System demand & ramp Given enough SURAMP, PB will not be violated as long as the aggregated offer curve required to meet demand is less than PB penalty If PB Penalty is lower than SWCAP then PB will be violated in SCED1 before dispatching Resources on Output Schedule

PB Violation with Transmission Constraints
Gen with +ive SF SF * TC_Penalty + Offer cost PB_penatly If (a) > (b) - moved down for resolving constraints If (a) < (b) - moved up for meeting Power Balance Example Violated TC penalty \$3500; 0.2 SF; \$100 0ffer cost ; \$500 PB penalty 1 MW reduction in generation will reduce TC violation by 0.2 MW will reduce objective by 0.2 * due to reduction in TC violation and \$100 by not providing 1MW energy violate PB by 1 MW Will increase objective by 1* \$500 During scarcity if a transmission constraint is violated then transmission constraint and Power Balance constraint will interact with each other to determine whether to move up or move down a resource with +ive SF to the violated constraints if there are no other resources available.

Power Balance Penalty Curve - Implementation
10 segment step curve MW break points Sets amount violated for a given price Penalty for violation up to the MW break point Sets system lambda for a given amount of violation

Factors affecting Power Balance Violation
Ramp limited scenarios Operational Philosophies Extend of ramp being reserved for regulation Amount of capacity on Output Schedule Telemetry errors Capacity Scarcity

Current Power Balance Penalty Curve Values
Over Generation Penalty (\$/MWh) -3,001 -5,000 MW Cap Segment (MW) 10,000 100,000 Under Generation Penalty (\$/MWh) 3,001 5,000 MW Floor Segment (MW) equivalent to having extra capacity for meeting power balance violation at (+/-) 3001 \$/MWh for violated MW from 0MW to MW, and (+/-) 5000\$/MWh for violated MW from 10000MW to MW

Proposed Power Balance Penalty Curve
MW Price 1 200 5 250 10 300 20 400 30 500 40 1000 50 2250  100000  3001

Factors Considered Extend of regulation that can be sacrificed
Operational philosophies System Wide Offer Cap - \$3000 Interaction with transmission constraints Interaction with proxy offer curves Market Trials and close loop test results

Future Areas of Improvement for Better Scarcity Pricing
Prices not reflective of scarcity during UFR Load Resource deployment Reduction in prices due to Output Schedule adjustments during Non-Spin deployment from Resources on Output Schedule Dependence on MP submitted EOC to set scarcity pricing during Non-Spin and RRS deployment

Appendix

SCED Objective Min { Cost of generation dispatch + Sum ( Max Shadow Price * Slack variable)} Generation dispatch cost + Power Balance Penalty Curve value Slack Variable Slack Variable + Slack Variable Max Shadow Price

SCED constraints Power Balance Constraints:
Transmission Network Constraints: Resource Constraints: Ramp Rate Constraints (HDL, LDL):

Offer Mitigation for SCED2
(1)Cap the Energy Offer Curves at the greater of the Reference LMP at the Resource Node or the Mitigated Offer Cap curve (2) Bound it at the lesser of the Reference LMP at the Resource Node or the Mitigated Offer Floor.

Proxy Offer Curve for Output Schedule

Resource moved down for congestion
LMP during Congestion Resource moved down for congestion

Resource moved up for congestion
LMP during Congestion Resource moved up for congestion

Transmission Constraints Penalty Current Values
Maximum Shadow Price for Transmission Constraints Base Case:  \$5,000/MW Generic constraints :  \$5,000/MW Post Contingency 345 kV:  \$4,500/MW 138 kV:  \$3,500/MW 69 kV:  \$2,800/MW

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