11

FREQUENCY LINKED DISPATCH FREQUENCY LINKED DISPATCH AND ELECTRICITY PRICINGAND ELECTRICITY PRICING

(An unconventional approach for tackling (An unconventional approach for tackling the peculiar problems existing in India)the peculiar problems existing in India)

- - Bhanu Bhushan - Bhanu Bhushan -

Director (Operations)Director (Operations)

Power Grid Corporation of India Ltd.Power Grid Corporation of India Ltd.

(The Central Transmission Utility)(The Central Transmission Utility)

22

BACKGROUND (situation upto early 2002)BACKGROUND (situation upto early 2002)

Deplorable state of regional grid operationDeplorable state of regional grid operation

Uncontrolled frequency fluctuations, from below Uncontrolled frequency fluctuations, from below 48.0 Hz to above 52.0 Hz.48.0 Hz to above 52.0 Hz.

Voltages beyond permissible limitsVoltages beyond permissible limits Frequent grid disturbancesFrequent grid disturbances Lack of optimization in generation Lack of optimization in generation

(merit – order compromised)(merit – order compromised) Unchecked deviations from schedulesUnchecked deviations from schedules Perpetual operational and commercial disputes Perpetual operational and commercial disputes

between utilitiesbetween utilities

33

MAIN REASONS :MAIN REASONS :

Shortage and poor availability of generating capacity Shortage and poor availability of generating capacity → extensive (but inadequate) load curtailment, → extensive (but inadequate) load curtailment, particularly during peak load hours.particularly during peak load hours.

Reluctance to back down generation during off-peak Reluctance to back down generation during off-peak hours, due to faulty bulk power tariff structure hours, due to faulty bulk power tariff structure (single-part, constant paise / kWh)(single-part, constant paise / kWh)

Inadequate reactive compensation at load end Inadequate reactive compensation at load end Blocked governorsBlocked governors Gaps in understanding of the subject, and a lack of Gaps in understanding of the subject, and a lack of

consensus on how to tackle the problem.consensus on how to tackle the problem.

44

Federal democracy : Tussle between Central Federal democracy : Tussle between Central Government organisations and State Government-Government organisations and State Government-owned vertically integrated utilitiesowned vertically integrated utilities

Lack of load dispatch and communication facilities to Lack of load dispatch and communication facilities to apply conventional load-frequency control, tie-line apply conventional load-frequency control, tie-line bias, control area concepts, etc.bias, control area concepts, etc.

A structured study in 1993-94 by M/s. ECC of USA, A structured study in 1993-94 by M/s. ECC of USA, sponsored by World Bank/Asian Development Banksponsored by World Bank/Asian Development Bank

→ → AVAILABILITY TARIFFAVAILABILITY TARIFFImplementation started in 2002Implementation started in 2002

55

Components of Availability TariffComponents of Availability Tariff

(a)(a) Capacity Charge : for payment of fixed costCapacity Charge : for payment of fixed cost(b)(b) Energy Charge : for payment of variable costEnergy Charge : for payment of variable cost(c)(c) Unscheduled Interchange : adjustment for deviationsUnscheduled Interchange : adjustment for deviations

(a)(a) is a function of ex-bus MW capability of the power plant is a function of ex-bus MW capability of the power plant for the day declared in advance, paid by beneficiaries for the day declared in advance, paid by beneficiaries their respective % share in the planttheir respective % share in the plant

(b)(b) = MWh for the day as per ex-bus drawal schedule for the = MWh for the day as per ex-bus drawal schedule for the beneficiary finalized in advance x Energy charge rate for beneficiary finalized in advance x Energy charge rate for the Plantthe Plant

(c)(c) = = ΣΣ [( Actual energy interchange in a 15- minutes time [( Actual energy interchange in a 15- minutes time block block scheduled interchange for the time block) x UI scheduled interchange for the time block) x UI rate for the time block ]rate for the time block ]

Total Payment for the day = (a) + (b) + (c)Total Payment for the day = (a) + (b) + (c)

66

77

88

99

Frequency Profile of SRFrequency Profile of SR

FREQUENCY COMPARISION FOR 26-J UNE 02 & 03

47.5

48.0

48.5

49.0

49.5

50.0

50.5

51.0

51.5

00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23

HOUR ---->

FR

EQ

UEN

CY IN

HZ ---

->

2003

2002

1010

Frequency Profile of ERFrequency Profile of ER

FREQUENCY CURVE

6th June02

6th June03

47.00

48.00

49.00

50.00

51.00

52.00

53.00

00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 23Time (Hrs.)

Frq

e (H

z.)

1111

IMPROVEMENTS BROUGHT ABOUTIMPROVEMENTS BROUGHT ABOUT

Generation being maximized during peak-load hours : Generation being maximized during peak-load hours : more consumer load being met.more consumer load being met.

Generation being backed down during off-peak hours, Generation being backed down during off-peak hours, and according to merit-order and according to merit-order

Overdrawals being curtailed by SEBs, on their own : Overdrawals being curtailed by SEBs, on their own : Karnataka has shifted about 1000 MW load from peakKarnataka has shifted about 1000 MW load from peak

load hours to off-peak.load hours to off-peak. Dramatic improvement in frequency: Karnataka farmers Dramatic improvement in frequency: Karnataka farmers

can manage with fewer hours of supply.can manage with fewer hours of supply. Voltages improved ; Transmission losses reduced;Voltages improved ; Transmission losses reduced; Transmission capacity increased.Transmission capacity increased.

1212

Automatic under-frequency load shedding restored :Automatic under-frequency load shedding restored :

grid security improved.grid security improved. Power plants’ performance improved, trippings and Power plants’ performance improved, trippings and

long-term damage reduced.long-term damage reduced. Commercial and operational disputes resolved.Commercial and operational disputes resolved. Autonomy to utilities (within the framework).Autonomy to utilities (within the framework). Shares/allocations now have a meaning.Shares/allocations now have a meaning. Framework for bilateral trading established at inter-Framework for bilateral trading established at inter-

State levelState level

1313

Formal scheduling process in placeFormal scheduling process in place Optimized use of hydro resources, including Optimized use of hydro resources, including

pumped storage.pumped storage. Common pricing signal through frequency : true Common pricing signal through frequency : true

free-market in electricity established.free-market in electricity established. IPPs being scheduled according to their tariff.IPPs being scheduled according to their tariff. High demands met through UI mechanism, e.g. High demands met through UI mechanism, e.g.

World Cup Final on 23.03.2003.World Cup Final on 23.03.2003.

1414

Drawal schedule = xDrawal schedule = x

Actual drawal = yActual drawal = y

UI = y – x UI = y – x

x at normal pricex at normal price

(y - x) at frequency - (y - x) at frequency -

linked price linked price

1515

Frequency is low when total available generation in the Frequency is low when total available generation in the grid is insufficient to meet the demand. High price of grid is insufficient to meet the demand. High price of overdrawal encourages the States to curtail their overdrawal encourages the States to curtail their drawal by drawal by

Maximising own generationMaximising own generation Curtailing consumer loadCurtailing consumer load Harnessing costlier generationHarnessing costlier generation

Also, under-drawal pays.Also, under-drawal pays.

1616

Frequency is high when total generation in the grid is Frequency is high when total generation in the grid is more than the total consumer load.more than the total consumer load.

Low price of overdrawal encourages States to increase Low price of overdrawal encourages States to increase their drawal by their drawal by

Reducing own generationReducing own generation Shifting consumer load to off-peak hoursShifting consumer load to off-peak hours

Costlier energy replaced by cheaper energyCostlier energy replaced by cheaper energy

1717

UNDERLYING PHILOSOPHYUNDERLYING PHILOSOPHY

Interchange schedules are to serve as operational and Interchange schedules are to serve as operational and commercial datum, but deviations are allowed / commercial datum, but deviations are allowed / encouragedencouraged

Frequency allowed to float : no attempt to bring it Frequency allowed to float : no attempt to bring it back to 50.0 Hz.back to 50.0 Hz.

Frequency-linked dispatch of generationFrequency-linked dispatch of generation

1818

1919

OTHER ADVANTAGESOTHER ADVANTAGES

Autonomy and flexibility to utilities/partipantsAutonomy and flexibility to utilities/partipants

Framework for harnessing Captive and Co-Framework for harnessing Captive and Co-generation, non-conventional, pumped hydro.generation, non-conventional, pumped hydro.

Telemetering, computing, telecontrol, communication Telemetering, computing, telecontrol, communication and data transmission are no longer critical and data transmission are no longer critical

2020

Thank YouThank You