Effective market integration of decentralized flexibility in the electricity system Energydays 28-03-2019 Introductie Michiel Master thesis Nederland zweden Spanish DSO MIT collective power taylor.
From commodity to differentiated value Temporal value differentiation Locational value differentiation Diverse supply and demand curves from actors and technologies Socialized cost of infrastructure more complex Fuel price Economy of scale Non dispatchable Close to consumption -> diseconomy of scale Energydays 28-03-2019
Cost-reflective markets Balance market is about market adequacy Verzuipen van onbalans free flex Capacity markets Fundamental/transitional Which sub-market regulations are cost-reflective? Wide variety of transaction mechanisms Regulatory limitations Balance market offer significant profits yet self-destructing size Distribution capacity markets come as a local tipping point Increased electrification resulting in “free flex” Large asymmetry in market layers Energydays 28-03-2019
Inclusivity determines market models Goal is cost-reflective and fair Energydays 28-03-2019
Platform functions From sub-market to consumer -> platforms (market services – middle man) Energydays 28-03-2019
Perfect competition in fair markets What type of market structure (player) Energydays 28-03-2019
Micro-economic characterization Network effect TVPP Transitional value perfect information CVPP Fundamental/transitional Energydays 28-03-2019
Economies of scope ABB Google – amazon Tesla Banking Energydays 28-03-2019
Flexibility aggregator (single - explicit) Centralized renewables Capacity market mechanisms Supra-national suppliers Portfolio dispatch management Flexibility aggregator Energydays 28-03-2019
Energy as a service (locational - explicit) Energy vector integration Unbundling Energy management platform Sustainable area developer Energydays 28-03-2019
Internet of energy (single - implicit) Load defection Infrastructure reinforcement Retail subsidies Digital infrastructure System market platform Energydays 28-03-2019
Collective power (locational – implicit) Electrification Supra-national market Load opportunism Congestion management Local utility Energydays 28-03-2019
Conclusion The electricity system and market models are changing over time The electricity system and market models are changing different per location Market models are path dependent Market models are both an optimization problem as well as a societal choice (solar – squeeze of gas – taxes NL climate) (Pyrenees – de minimis) (system banks too big to fail vs Sweden) (algorithms – Enron marktmodel amerika) (support climate change – wind turbines) Energydays 28-03-2019