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832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 137
Power PlanningPower Market
Power System
Power Market Operation
Sang-Jin Chung
T ampJ Construction Co Ltd
+82-10-5234-6134
sjchungkpxorkr
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 237
Copyright 2011 by KPX co Ltd All rights reserved
IIII
II
IIIIII
Power Business Overview
Electricity Market
Recent Market Results
Market IssuesⅣⅣ
ⅣⅣ
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 337
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Power Business OverviewII
Electric Power SystemGeneration Sites amp Fuel Mix
Transmission System Network
Peak Demand amp Capacity Margin
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
AndukSin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
ChungbuYoungdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
HwasungSin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-OkcheonSinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-DaeguSunsan
GoryeongDaegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
CHARACTERISTICS
Isolated power grid within Korean peninsularHigh growth rates of power consumption
- Annual increase rates
middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66
lsquo06-rsquo10 56Highly dependent on foreign energy resources- 964 of primary energy imported (232 million
toe lsquo08) Primary energy resources
- Oil 431 Coal 276 LNG 153 Nuclear140
KEY STATISTICS (2010)
People served (million) 50
Generating capacity (MW) 76078
Peak loads (MW) 71308
Total transmission lines (C-Km) 30676
Electricity traded annually (GWh) 406000
Generators (above 20MW) 372 ea
4
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Bundang
Seoul
Sanchung
Hapchun
Cheongsong
IncheonPucheon
Pyungtaek
Anyang
Youngkwang
Chungju
Chuam
Yeosu
Honam Kwangyang
Sumjinkang
Yongdam
Muju
SeocheonBoryeong
POSCO
Sin-IncheonPaldnag
Chungpyung
Euiam
ChuncheonHwachun
Hadong
Samrangjin
SamcheonpoBusan
Kori
Andong
Yangyang
Kangreung
Uljin
Imha
Youngnam
Wolseong
Small Hydro (Pocheon etc)
Soyangkang
Ilsan
Youngheung
Taean
LGBugok
Ulsan
Daechung
Dangjin
Seo-Incheon Youngdong
Donghae
Yulchon
Jeju
(Unit 10 MW)
53180
99
120
180
50
48
45 9050
45
180180
180
90
40
33
74
50
40
400300
180
300
400
40
247
140
39
400
115
53
590
278
314590
6
60
10011
12
8
7
20
2
3
2
9
59
60
41
40
6010
70
6
5Chungpyung
As of Dec 31 2010
Capacity by Fuels(Unit MW)
Nuclear
17716(233)
Oil
5805(76)
Hydro5524(73)
Renewable
1762(23)Coal
24800
(326)
LNG
20471
(269)
5
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Characteristics
Direct Current Line
- Connect the main land
to Jeju Island
345kV
Main transmission system
Distribution system
- Connected to major areas of consumption
154kV
Second HVDC Line between main landand Jeju island is being built by 2012( 300MW 700MW)rArr
765kVMass transmission system
(Unit C-km Numbers of SS)
154kV 20700 628
345kV 8552 88
765kV 755 6Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
Anduk Sin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
Chungbu
Youngdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
Hwasung
Sin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-Okcheon
Sinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-Daegu
Sunsan
Goryeong
Daegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Gwangyang Steel
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
Hadong TP Samcheonpo TPPusan CC
Gwangyang Steel
6
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
A peak demand of 71GW occurred on Dec 15 2010
bull 68 increase compared to the last yearlsquos peak
bull Higher than expected due to the extended cold waves
The capacity margin was just around 62 (the lowest since 2001)
bull Has gradually decreased due to the delayed construction in facilities
bull May improve from 2012 with the generator additions
45000
50000
70000
(UnitMW)
65000
60000
55000
rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10
62790
(08)62290(56)62290(56)
54630(66)54630(66)51260
(82)51260(82)
58990(80)58990(80)
Reserve margin
As of Dec 201071308
(68)
Peak demand
(Growth rate)
122122113113
105105
7272
9191
6262
66800
(64)
7979
rsquo09
7
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 237
Copyright 2011 by KPX co Ltd All rights reserved
IIII
II
IIIIII
Power Business Overview
Electricity Market
Recent Market Results
Market IssuesⅣⅣ
ⅣⅣ
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 337
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Power Business OverviewII
Electric Power SystemGeneration Sites amp Fuel Mix
Transmission System Network
Peak Demand amp Capacity Margin
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
AndukSin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
ChungbuYoungdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
HwasungSin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-OkcheonSinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-DaeguSunsan
GoryeongDaegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
CHARACTERISTICS
Isolated power grid within Korean peninsularHigh growth rates of power consumption
- Annual increase rates
middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66
lsquo06-rsquo10 56Highly dependent on foreign energy resources- 964 of primary energy imported (232 million
toe lsquo08) Primary energy resources
- Oil 431 Coal 276 LNG 153 Nuclear140
KEY STATISTICS (2010)
People served (million) 50
Generating capacity (MW) 76078
Peak loads (MW) 71308
Total transmission lines (C-Km) 30676
Electricity traded annually (GWh) 406000
Generators (above 20MW) 372 ea
4
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Bundang
Seoul
Sanchung
Hapchun
Cheongsong
IncheonPucheon
Pyungtaek
Anyang
Youngkwang
Chungju
Chuam
Yeosu
Honam Kwangyang
Sumjinkang
Yongdam
Muju
SeocheonBoryeong
POSCO
Sin-IncheonPaldnag
Chungpyung
Euiam
ChuncheonHwachun
Hadong
Samrangjin
SamcheonpoBusan
Kori
Andong
Yangyang
Kangreung
Uljin
Imha
Youngnam
Wolseong
Small Hydro (Pocheon etc)
Soyangkang
Ilsan
Youngheung
Taean
LGBugok
Ulsan
Daechung
Dangjin
Seo-Incheon Youngdong
Donghae
Yulchon
Jeju
(Unit 10 MW)
53180
99
120
180
50
48
45 9050
45
180180
180
90
40
33
74
50
40
400300
180
300
400
40
247
140
39
400
115
53
590
278
314590
6
60
10011
12
8
7
20
2
3
2
9
59
60
41
40
6010
70
6
5Chungpyung
As of Dec 31 2010
Capacity by Fuels(Unit MW)
Nuclear
17716(233)
Oil
5805(76)
Hydro5524(73)
Renewable
1762(23)Coal
24800
(326)
LNG
20471
(269)
5
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Characteristics
Direct Current Line
- Connect the main land
to Jeju Island
345kV
Main transmission system
Distribution system
- Connected to major areas of consumption
154kV
Second HVDC Line between main landand Jeju island is being built by 2012( 300MW 700MW)rArr
765kVMass transmission system
(Unit C-km Numbers of SS)
154kV 20700 628
345kV 8552 88
765kV 755 6Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
Anduk Sin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
Chungbu
Youngdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
Hwasung
Sin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-Okcheon
Sinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-Daegu
Sunsan
Goryeong
Daegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Gwangyang Steel
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
Hadong TP Samcheonpo TPPusan CC
Gwangyang Steel
6
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
A peak demand of 71GW occurred on Dec 15 2010
bull 68 increase compared to the last yearlsquos peak
bull Higher than expected due to the extended cold waves
The capacity margin was just around 62 (the lowest since 2001)
bull Has gradually decreased due to the delayed construction in facilities
bull May improve from 2012 with the generator additions
45000
50000
70000
(UnitMW)
65000
60000
55000
rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10
62790
(08)62290(56)62290(56)
54630(66)54630(66)51260
(82)51260(82)
58990(80)58990(80)
Reserve margin
As of Dec 201071308
(68)
Peak demand
(Growth rate)
122122113113
105105
7272
9191
6262
66800
(64)
7979
rsquo09
7
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 337
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Power Business OverviewII
Electric Power SystemGeneration Sites amp Fuel Mix
Transmission System Network
Peak Demand amp Capacity Margin
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
AndukSin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
ChungbuYoungdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
HwasungSin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-OkcheonSinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-DaeguSunsan
GoryeongDaegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
CHARACTERISTICS
Isolated power grid within Korean peninsularHigh growth rates of power consumption
- Annual increase rates
middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66
lsquo06-rsquo10 56Highly dependent on foreign energy resources- 964 of primary energy imported (232 million
toe lsquo08) Primary energy resources
- Oil 431 Coal 276 LNG 153 Nuclear140
KEY STATISTICS (2010)
People served (million) 50
Generating capacity (MW) 76078
Peak loads (MW) 71308
Total transmission lines (C-Km) 30676
Electricity traded annually (GWh) 406000
Generators (above 20MW) 372 ea
4
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Bundang
Seoul
Sanchung
Hapchun
Cheongsong
IncheonPucheon
Pyungtaek
Anyang
Youngkwang
Chungju
Chuam
Yeosu
Honam Kwangyang
Sumjinkang
Yongdam
Muju
SeocheonBoryeong
POSCO
Sin-IncheonPaldnag
Chungpyung
Euiam
ChuncheonHwachun
Hadong
Samrangjin
SamcheonpoBusan
Kori
Andong
Yangyang
Kangreung
Uljin
Imha
Youngnam
Wolseong
Small Hydro (Pocheon etc)
Soyangkang
Ilsan
Youngheung
Taean
LGBugok
Ulsan
Daechung
Dangjin
Seo-Incheon Youngdong
Donghae
Yulchon
Jeju
(Unit 10 MW)
53180
99
120
180
50
48
45 9050
45
180180
180
90
40
33
74
50
40
400300
180
300
400
40
247
140
39
400
115
53
590
278
314590
6
60
10011
12
8
7
20
2
3
2
9
59
60
41
40
6010
70
6
5Chungpyung
As of Dec 31 2010
Capacity by Fuels(Unit MW)
Nuclear
17716(233)
Oil
5805(76)
Hydro5524(73)
Renewable
1762(23)Coal
24800
(326)
LNG
20471
(269)
5
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Characteristics
Direct Current Line
- Connect the main land
to Jeju Island
345kV
Main transmission system
Distribution system
- Connected to major areas of consumption
154kV
Second HVDC Line between main landand Jeju island is being built by 2012( 300MW 700MW)rArr
765kVMass transmission system
(Unit C-km Numbers of SS)
154kV 20700 628
345kV 8552 88
765kV 755 6Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
Anduk Sin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
Chungbu
Youngdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
Hwasung
Sin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-Okcheon
Sinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-Daegu
Sunsan
Goryeong
Daegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Gwangyang Steel
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
Hadong TP Samcheonpo TPPusan CC
Gwangyang Steel
6
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
A peak demand of 71GW occurred on Dec 15 2010
bull 68 increase compared to the last yearlsquos peak
bull Higher than expected due to the extended cold waves
The capacity margin was just around 62 (the lowest since 2001)
bull Has gradually decreased due to the delayed construction in facilities
bull May improve from 2012 with the generator additions
45000
50000
70000
(UnitMW)
65000
60000
55000
rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10
62790
(08)62290(56)62290(56)
54630(66)54630(66)51260
(82)51260(82)
58990(80)58990(80)
Reserve margin
As of Dec 201071308
(68)
Peak demand
(Growth rate)
122122113113
105105
7272
9191
6262
66800
(64)
7979
rsquo09
7
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
AndukSin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
ChungbuYoungdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
HwasungSin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-OkcheonSinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-DaeguSunsan
GoryeongDaegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
CHARACTERISTICS
Isolated power grid within Korean peninsularHigh growth rates of power consumption
- Annual increase rates
middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66
lsquo06-rsquo10 56Highly dependent on foreign energy resources- 964 of primary energy imported (232 million
toe lsquo08) Primary energy resources
- Oil 431 Coal 276 LNG 153 Nuclear140
KEY STATISTICS (2010)
People served (million) 50
Generating capacity (MW) 76078
Peak loads (MW) 71308
Total transmission lines (C-Km) 30676
Electricity traded annually (GWh) 406000
Generators (above 20MW) 372 ea
4
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Bundang
Seoul
Sanchung
Hapchun
Cheongsong
IncheonPucheon
Pyungtaek
Anyang
Youngkwang
Chungju
Chuam
Yeosu
Honam Kwangyang
Sumjinkang
Yongdam
Muju
SeocheonBoryeong
POSCO
Sin-IncheonPaldnag
Chungpyung
Euiam
ChuncheonHwachun
Hadong
Samrangjin
SamcheonpoBusan
Kori
Andong
Yangyang
Kangreung
Uljin
Imha
Youngnam
Wolseong
Small Hydro (Pocheon etc)
Soyangkang
Ilsan
Youngheung
Taean
LGBugok
Ulsan
Daechung
Dangjin
Seo-Incheon Youngdong
Donghae
Yulchon
Jeju
(Unit 10 MW)
53180
99
120
180
50
48
45 9050
45
180180
180
90
40
33
74
50
40
400300
180
300
400
40
247
140
39
400
115
53
590
278
314590
6
60
10011
12
8
7
20
2
3
2
9
59
60
41
40
6010
70
6
5Chungpyung
As of Dec 31 2010
Capacity by Fuels(Unit MW)
Nuclear
17716(233)
Oil
5805(76)
Hydro5524(73)
Renewable
1762(23)Coal
24800
(326)
LNG
20471
(269)
5
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Characteristics
Direct Current Line
- Connect the main land
to Jeju Island
345kV
Main transmission system
Distribution system
- Connected to major areas of consumption
154kV
Second HVDC Line between main landand Jeju island is being built by 2012( 300MW 700MW)rArr
765kVMass transmission system
(Unit C-km Numbers of SS)
154kV 20700 628
345kV 8552 88
765kV 755 6Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
Anduk Sin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
Chungbu
Youngdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
Hwasung
Sin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-Okcheon
Sinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-Daegu
Sunsan
Goryeong
Daegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Gwangyang Steel
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
Hadong TP Samcheonpo TPPusan CC
Gwangyang Steel
6
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
A peak demand of 71GW occurred on Dec 15 2010
bull 68 increase compared to the last yearlsquos peak
bull Higher than expected due to the extended cold waves
The capacity margin was just around 62 (the lowest since 2001)
bull Has gradually decreased due to the delayed construction in facilities
bull May improve from 2012 with the generator additions
45000
50000
70000
(UnitMW)
65000
60000
55000
rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10
62790
(08)62290(56)62290(56)
54630(66)54630(66)51260
(82)51260(82)
58990(80)58990(80)
Reserve margin
As of Dec 201071308
(68)
Peak demand
(Growth rate)
122122113113
105105
7272
9191
6262
66800
(64)
7979
rsquo09
7
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
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httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
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httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Bundang
Seoul
Sanchung
Hapchun
Cheongsong
IncheonPucheon
Pyungtaek
Anyang
Youngkwang
Chungju
Chuam
Yeosu
Honam Kwangyang
Sumjinkang
Yongdam
Muju
SeocheonBoryeong
POSCO
Sin-IncheonPaldnag
Chungpyung
Euiam
ChuncheonHwachun
Hadong
Samrangjin
SamcheonpoBusan
Kori
Andong
Yangyang
Kangreung
Uljin
Imha
Youngnam
Wolseong
Small Hydro (Pocheon etc)
Soyangkang
Ilsan
Youngheung
Taean
LGBugok
Ulsan
Daechung
Dangjin
Seo-Incheon Youngdong
Donghae
Yulchon
Jeju
(Unit 10 MW)
53180
99
120
180
50
48
45 9050
45
180180
180
90
40
33
74
50
40
400300
180
300
400
40
247
140
39
400
115
53
590
278
314590
6
60
10011
12
8
7
20
2
3
2
9
59
60
41
40
6010
70
6
5Chungpyung
As of Dec 31 2010
Capacity by Fuels(Unit MW)
Nuclear
17716(233)
Oil
5805(76)
Hydro5524(73)
Renewable
1762(23)Coal
24800
(326)
LNG
20471
(269)
5
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Characteristics
Direct Current Line
- Connect the main land
to Jeju Island
345kV
Main transmission system
Distribution system
- Connected to major areas of consumption
154kV
Second HVDC Line between main landand Jeju island is being built by 2012( 300MW 700MW)rArr
765kVMass transmission system
(Unit C-km Numbers of SS)
154kV 20700 628
345kV 8552 88
765kV 755 6Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
Anduk Sin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
Chungbu
Youngdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
Hwasung
Sin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-Okcheon
Sinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-Daegu
Sunsan
Goryeong
Daegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Gwangyang Steel
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
Hadong TP Samcheonpo TPPusan CC
Gwangyang Steel
6
832019 Power market operation-
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Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
A peak demand of 71GW occurred on Dec 15 2010
bull 68 increase compared to the last yearlsquos peak
bull Higher than expected due to the extended cold waves
The capacity margin was just around 62 (the lowest since 2001)
bull Has gradually decreased due to the delayed construction in facilities
bull May improve from 2012 with the generator additions
45000
50000
70000
(UnitMW)
65000
60000
55000
rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10
62790
(08)62290(56)62290(56)
54630(66)54630(66)51260
(82)51260(82)
58990(80)58990(80)
Reserve margin
As of Dec 201071308
(68)
Peak demand
(Growth rate)
122122113113
105105
7272
9191
6262
66800
(64)
7979
rsquo09
7
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Characteristics
Direct Current Line
- Connect the main land
to Jeju Island
345kV
Main transmission system
Distribution system
- Connected to major areas of consumption
154kV
Second HVDC Line between main landand Jeju island is being built by 2012( 300MW 700MW)rArr
765kVMass transmission system
(Unit C-km Numbers of SS)
154kV 20700 628
345kV 8552 88
765kV 755 6Jeju TP
Yangju
Seo-Incheon
Youngheung TP
Hanrim CC
NamjejuSeogwipo
Anduk Sin-Jeju
Hanla
Sungsan
Jocheon
Dong-Jeju
Sanji
Seo-Incheon CC
Incheon TP CC
Sin-Incheon
Sin-Sihung
Sin-Bupyung
Sin-Dukheun
Chungbu
Youngdeungpo
Youngseo
Seo-seoul
Uijeongbu
Sungdong
Hwasung
Sin-suwonPyungtaek TP CC
Ansan
Sin-DangjinDangjin TP
Taean TP
Sin-onyang
Boryeong TP CCChungyang
Gunsan
Sin-Gimje
Youngwang NP
Sin-Gwangju
Sin-Hwasun
Sin-Gangjin
Haenam CSYeosu NP
Gwangyang
Hadong TP
Sin-Namwon Euiryong
Sancheong PP
Muju PP
Sin-Okcheon
Sinkaedong
Chungwon
Sin-Jincheon
Sin-Gosung
Samcheonpo TP
In-Masan
Sin-Gimhae
Bukbusan
Pusan CCNam-Pusan
Kori NP
Sin-Onsan
Ulsan TP CC
Wolseong NPSeo-Daegu
Buk-Daegu
Sunsan
Goryeong
Daegu
Sin-Kyeongsan
Ulju
Sin-Ulsan
Sin-Youngju
Sin-Youngil
Cheongsong PP
Uljin NP
Donghae
Yangyang PP
Sin-Jecheon
Sin-Gapyung
Sin-Ansung
Sin-seosan
Sin-Yangje
Sin-Ansan
Sin-Taebaek
Gwangyang Steel
Sin-Yangsan
Sin-Youngin
Sin-Sungnam
Dong-Seoul
Migum
Gonjiam
Hadong TP Samcheonpo TPPusan CC
Gwangyang Steel
6
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
A peak demand of 71GW occurred on Dec 15 2010
bull 68 increase compared to the last yearlsquos peak
bull Higher than expected due to the extended cold waves
The capacity margin was just around 62 (the lowest since 2001)
bull Has gradually decreased due to the delayed construction in facilities
bull May improve from 2012 with the generator additions
45000
50000
70000
(UnitMW)
65000
60000
55000
rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10
62790
(08)62290(56)62290(56)
54630(66)54630(66)51260
(82)51260(82)
58990(80)58990(80)
Reserve margin
As of Dec 201071308
(68)
Peak demand
(Growth rate)
122122113113
105105
7272
9191
6262
66800
(64)
7979
rsquo09
7
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
A peak demand of 71GW occurred on Dec 15 2010
bull 68 increase compared to the last yearlsquos peak
bull Higher than expected due to the extended cold waves
The capacity margin was just around 62 (the lowest since 2001)
bull Has gradually decreased due to the delayed construction in facilities
bull May improve from 2012 with the generator additions
45000
50000
70000
(UnitMW)
65000
60000
55000
rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10
62790
(08)62290(56)62290(56)
54630(66)54630(66)51260
(82)51260(82)
58990(80)58990(80)
Reserve margin
As of Dec 201071308
(68)
Peak demand
(Growth rate)
122122113113
105105
7272
9191
6262
66800
(64)
7979
rsquo09
7
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 837
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power SystemElectricity MarketIIII
Key FeaturesMarket Operations
- Procedures
- Biddings
- Load Forecasting
- Generation Scheduling
- Metering
- Settlement
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Mandatory Pool
bull All generators(ge 1 MW) and retailers should trade(buy and sell)electric power through the market All market participants shouldregister as the KPX member
bull The market players are GENCOs(sellers) and KEPCO(the single buyer)
Generator Bidding Pool
bull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day
bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the tradingday
bull The market clearing is processed hourly base prices and volumes arefixed day-ahead for 24 hours of the following day
9
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Cost Based Pool (CBP)
bull The cost (not the price) of each generator is bid into the pool
ndash The generation cost is determined monthly by the Generation Cost EvaluationCommittee(GCEC) based on the fuel prices in the previous month
ndash As mentioned before the generators bid only their availability
bull The System Marginal Price(SMP) is determined in the process of Price SettingScheduling
ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)
bull The Capacity Payment(CP) is paid by for the availability declared(MW)
ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submitoffer data whether or not dispatched
ndash CP is determined at every year and it is adjusted considering the level of reservemargin which can be the signal of investments
CONCOFF Payment are payed for the differences between the scheduled andthe actual generations
10
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Marginal Loss Factor(MLF) for the transmission lossintroduced( rsquo07)
- To minimize the long-term social cost by the incentives to generationinvestment in heavy load center (Generation+Transmission)
- To operate optimally the resources in the short-term by considering the
locational value of generations The transmission losses are considered
- MLFs are applied to generator nodes Application to the load nodes is
not necessary because the KEPCO is the single buyer
- As the stranded costs were incurred a relaxation factor was introduced
to prevent the abrupt change of generator revenues(10 increase in each
year)
Definition of MLF
11
Change of generation at the reference busMLF = -------------------------------------------------------
Change of load at a specific bus
= 1 + Loss Load increment where Loss change of total loss in the network
Load increment incremental load at acertain bus
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Types of of Ancillary Services
1) Frequency Control GFAGC2) Generation Reserves Operational reserves provided by fast start
generators
3) Black Starts 1 or 2 Self start-up generators per region
4) Voltage Regulation Service Obligation of reactive power supply
Ancillary Services Payments
bull Compensation for ancillary services is paid according to theircontributions ie GFAGC service performances are assessd by theperformance index
bull Co-optimization between energy and ancillary is possible
bull The economic dispatch principle (merit order) is fully met ie the rolesof each types of the generator is fulfilled according to their functions
ie the Base load(Coal) Max energy outputthe Peaker(LNG) Effective load following by providing AGC service
12
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
The reference capacity payment(RCP) is adjusted according to theforecasted capacity margin by regions (metropolitanotherJeju island) whenit is beyond a reasonable value ie12
The seasonalhourly coefficients are applied to RCP to ensure the sufficientgeneration capacity in peak times
All the offered capabilities of the centrally dispatched generators(over 20MW) are compensated by hourly based RCP regardless of their actualoperations
13
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 14
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 15
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Daily Bidding
bullContents ndash Hourly availability
ndash Technical characteristics
bull Bidding time
ndash Closing time AM 1000 trading-day ahead(D-1)
ndash Term 34 hours (1900 D-1 ~ 0400 D+1)
Default Data is used if generators donrsquot submit their data due tocommunication failures or human errors
Re-Offers
bull Starting Time 1001 AM before the trading day
bull Closure Time l (one) hour before the trading hourldquo Re-offerrdquo is allowed only when the generator has faults and it
cannot meet the declared availability
16
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Real-timeReal-time
DispatchDispatch(D-0)(D-0)
A Day-aheadA Day-ahead MMarketarket
( D-1 )( D-1 )
Daily bidamp offer
made by standing
bid procedure
5 am 10am
Daily bid
Submission
Gate Closure
16pm
Pumping bid
Gate Closure
15pm
SMPDisclosure
Trading hour
20pm
18pm
SystemOperationSchedule
Disclosure
19pm
Bid change Closure
1 hour before trading hour
faults outages
17
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
18
P(MW)P(MW)
C C
i i ( $
h o ur )
( $
h o ur )
No-load -
Cost
Generation Cost [WonkWh] = Heat rate [kcalkWh] times Fuel cost [Wonkcal]
- Gencos submit monthly the fuel cost data to the Committee
- Fuel consumption rates are measured at 25 50 75 100 of the gen
output level during the performance test
Cost curve Determine the efficiency coefficients(abc)
Cost(CCost(Cii) =) = (aP(aP22 + bP + c+ bP + c) x Fuel) x FuelCostCost$hour Gcalhour $Gcal$hour Gcalhour $Gcal
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 1937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Forecasting tool
bull Load forecasting system (LOFY)
Application
bull For the fairness and transparency of the market pricing the output of LOFYis used without any adjustments or modifications
bull However for the operational generation schedule specific knowledge
experiencesjudgement of the engineer who is in charge is added
Using database
bull Weather forecasting data (Korea Meteorological Administration)
bull Historical load data (using similar day pattern data)
LOFY was developed by the KEPRI(Korea Electric Power Research Institute)and updated their historical data base every year
19
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Generation Scheduling Program
Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999
bull in 2010 changed into New RSC with MIP(Mixed Integer Program) solution
Major Functions
bull Market-based scheduling and day-ahead dispatch scheduling
bull The price setting is made by the unconstrained schedule and the
generator dispatch planning by the constrained schedule
20
RSC( Resource Scheduling and Commitment) determines the
generator startstop operations and also the generation outputs
which can minimize the total generation cost while balancing
supply and demand
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2137
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Scheduling
bull The cost data bidding data and forecasted load data are input for generationscheduling
bull Least cost generation scheduling reflects only the technical characteristics of generators
bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM
System Operational Scheduling
bull The forecasted load data can be adjusted for the system operational scheduling
bull All the system constraints such as the reserve margin transmission limits fuelrestrictions co-generation for district heat supply are reflected in the scheduling
bull The scheduling result(startsstops dispatch targets) are notified to Gencos
before 600 PM to prepare their operations
21
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Price Setting Schedule System Operational Schedule
Features To produce the hourly SMP in themarket
To produce the actual operational schedulein consideration of various constraints of the
power system
Input
Data
bull Hourly forecasted load (34 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Hourly forecasted load (24 hrs)
bull Generation cost curve
bull Generator availability
bull Technical characteristics of thegenerating units
bull Transmission constraintsbull Reserve constraints
bull Heat supply and fuel constraints
bull Hydro and pump storage constraints
ObjectiveFunction
Total Generation Cost Minimization
DisclosureTime
bull Published at 1500 (D ndash 1) bull Published at 1800 (D ndash 1)
22
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2337
How do we set the market price
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2437
p(SMP) (2)
(Time)
(Unit WonkWh
(Unit10MW)
Low
High
0100 0400 0900 1200 1500 1900 2100 2400
Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740
Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865
24
Power demand
Market price
Available supply capacity
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2537
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
All kinds of constraints should be considered inthe real timebull All the data should be updated based on the initial operational schedule
such as the load forecasts generator availability changes(Re-Offers)heat supply and fuel constraints and hydro and pump storage operationsetc
bull SCADA data is very important at this stages for the system stability
analysisbull Schedule energy (generation and dispatch-able load) regulation and
operating reserves every 5 minutes to -
minimize cost
balance load
meet regulation and reserve requirements
satisfy transmission constraints
satisfy generatorload constraints
25
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)
bull Ancillary serve requirements is met by the MOS-EMS coupling
bull AGC base points are given by MOS and economic participation factors aswell
bull Coupled operation between the AGC operation scheme of the existing EMSand the MOS economic dispatch algorithms
Requirements of MOS-EMS Coupling
① Transform the CBP cost data into the MOS bidding data(10 prices andoutputs)
rarr The bidding data transformation server does this
②Accuracies of the Load ForecastState Estimation are possible by the reliableSCADA RTU performance and the network modeling techniques
③ The on-line monitoring of MOS operation is required
26
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2737
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 27
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2837
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 28
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 2937
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Day-ahead
Market
Price(SMP)
Schedule
Load Forecast
Cost Based
Bid Curve
Capacity
Bid
Real Time
System Operation
A S Bid
Generation
Capacity Prices
AS Prices
Energy
Scheduled
Metered
Capacity
A S
Settlements
+-
29
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3037
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
IPPs SMP is paid for trading volumes
bull Giving incentives for independent power producers and inducing the invests for the
base load generations
KEPCO Subsidiary Gencos RRC is applied instead of the full SMP
bull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls
bull Financial balancing among six power generation subsidiaries
RRC Regulated revenue coefficients are different according to the generator types
Classification Variable Cost Fixed Cost(WonkW-hour)
IPPS SMP 746
KEPCO Subsidiary(by generator types)
Variable cost+(SMP-VC)timesRRC
30
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3137
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System Recent Market ResultsⅢⅢ
Trends of Electricity Trading
Market Prices amp Retail Tariffs
Summary of the Market Experiences
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3237
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
Trade Volumes(Unit TWh)
Trade Payments(Unit Billion Dollar)
rsquo07 rsquo08 rsquo10rsquo07 rsquo08 rsquo10
18
2328
Number of Members
(Unit No)
rsquo07 rsquo08 rsquo10
As of December 2010
104
302422
374
392441
Number of participants has increased due to the growth of the renewablesespecially the solar power (104 members in lsquo07 422 members in lsquo10)rArr
Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5≒ )
bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )
6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010
32
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3337
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program
MarketPurchasing Pricesbull Steadily rising since the establishment of the
market
bull The market price jumped in 2008 due to highincrease of fuel prices
bull Market prices were maintained at high levelshowever the average settlement prices keptat a marginally increased level thanks to thenuclear power
Retail prices
bull Stable even with the high fuel prices
bull This is because retail tariffs are regulated by thegovernment and KEPCOrsquos financial status are notgood in recent years due to the high purchasing pric
bull Cross subsidy between the tariffs according to theusages make it difficult to progress the marketevolutions
lt Retail tariffs by the usages gt
lt Market PricePurchasing Price gt($MWh)
33
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3437
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 34
Electricity market reduces the electricity production cost andmaximizes the resource availability
bull Economic dispatch is possible based on generation cost
bull Increasing the efficiency of OampM works of the generating facility
bull Improving the rate of using low-cost facility(nuclear coal)
(Capacity factor of nuclear and coal power plants are increased after operation of CBP market as 339p and 27p respectively)
Accomplish the efficiency of investment
bull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened
- About 1000MW substitution effect of new base load generator were occurred after
the market opening
bull OM cost were cut down owing to the competition
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3537
Copyright 2011 by KPX co Ltd All rights reserved
Power PlanningPower Market
Power System
Market IssuesⅣⅣ
Cross Subsidy between Customers
Demand Response
Vesting Contract
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3637
Copyright 2011 by KPX co Ltd All rights reserved 2011 IRAN IGMC Power System Operation Training Program 36
Vesting Contract between Gencos and KEPCO has beensuggested for the existing generators which were commissionedbefore the market opening(Because their construction cost hasbeen already recovered and should be paid less compared thenew generations)
Cross subsidized tariffs between the electricity users results ininefficient use of the electricity in the beneficiaries
bull It seems that some users waste the electricity at heatingbecause of low electricity prices compared with other form of energy
Demand response mechanism in the market will contribute tothe optimal use of the electricity in generals
bull By using the market price(if possible the real-time price) asthe economic signal smart grid initiatives will have a brightfuture in the industry
Po er PlanningPower Market
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
832019 Power market operation-
httpslidepdfcomreaderfullpower-market-operation- 3737
Power Planning
Power System
THANK YOU
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