Zonal and Nodal Pricing

The allocation of transmission capacity in day-ahead power system operations is a key driver of efficient system performance, due to its impact on the short-term price signal that will be used by investors to shape the system in the long term. In a context of increasing uncertainty and variability due to the growing integration of renewable energy sources, a robust physics-aware price signal has become more important than ever to drive the right investment for the grid of the future.

In this work, we develop a modeling framework that can be used to evaluate the performance of different market designs (nodal and zonal) to (i) efficiently schedule generating units on the short-term and (ii) provide prices that lead to the right signal for investment in the long-term. Our framework is based on a best-case modeling of zonal operations which does not depend on discretionary parameters (such as aggregate line capacities) using the exact projection of the set of feasible net injections on the zonal net positions space. It accounts for advanced active network management features such as transmission switching and is accompanied by a computational infrastructure for simulating a realistic instance of the European system.

We propose an exact projection of the set of feasible net injections on the zonal net positions space as a way to analyze zonal market clearing that does not depend on discretionary network model parameters.

Read more

Q. Lété, A. Papavasiliou, Impacts of Transmission Switching in Zonal Electricity Markets – Part I, IEEE Transactions on Power Systems, forthcoming

Q. Lété, A. Papavasiliou, Impacts of Transmission Switching in Zonal Electricity Markets – Part II, IEEE Transactions on Power Systems, forthcoming

I. Aravena, A. Papavasiliou, Renewable Energy Integration in Zonal Markets, IEEE Transactions on Power Systems, vol. 32, no. 2, pp. 1334-1349, March 2017

J. Han, A. Papavasiliou, Congestion Management through Topological Corrections: A Case Study of Central Western Europe, Energy Policy, vol. 86, pp. 470-482, November 2015