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Managing Uncertainty with Flexibility

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Integrating Renewables in Electricity Markets

Abstract

As stochastic production units such as those based on wind or solar sources involve both high variability and high uncertainty, system flexibility is needed to accommodate such variability and uncertainty. System flexibility, which is analyzed in this chapter from the viewpoint of the Independent System Operator, involves preventive and corrective actions by conventional power plants, the demand, pumped-storage plants, as well as the availability of sufficient transmission capacity. This chapter analyzes the flexibility provided by these agents and illustrates its effects on system operations and costs through a number of examples.

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Correspondence to Juan M. Morales .

Exercises

Exercises

5.1

Consider a single-bus system including two thermal production units and one demand operating over a two-period time horizon. Visualize the effect on the operation outcomes of increasingly restrictive ramping limits (up and down) on one of the thermal units.

5.2

Substitute in Exercise 5.1 above the thermal unit with no ramping limits with a wind power plant characterized by three production scenarios. With such configuration, visualize the effect on the operation outcomes of increasingly restrictive ramping limits on the thermal unit.

5.3

Consider a single-bus system including a thermal unit, a pumped storage one and a demand operating over a horizon involving two time periods. Analyze the effect of increasing the upper and lower reservoir sizes on the operation outcomes of the pumped-storage unit.

5.4

Substitute the thermal plant in Exercise 5.3 above by a concentrating solar thermal plant characterized by three production scenarios. Analyze the effect on the operation outcomes of increasing the reservoir sizes (upper and lower) of the pumped-storage unit.

5.5

Consider a two-bus electric energy system operating over a two-period time horizon. A combined-cycle gas turbine is available at bus 1 while a wind power plant and a solar thermal power plant are located at bus 2. The demand is located at bus one. Each stochastic power plant is characterized by two scenarios. Analyze how locational marginal prices change with the capacity of the line.

5.6

Consider a single bus system including two thermal units and one demand operating over a horizon comprising two time periods. The capacity of the cheaper thermal unit allows supplying 95 % of the load at peak demand while the expensive thermal unit covers the remaining 5 %. Analyze the impact on market outcomes of a reduction in the peak load of the demand. What is the impact on clearing prices?

5.7

A single bus electric energy system includes a solar thermal plant and a combined cycle gas turbine to supply a constant demand. Both production units can operate from 0 to maximum power output. The operation of the solar thermal plant is characterized by two scenarios. Carry out a sensitivity analysis (as in [3]) to find out how clearing prices change as the production scenarios of the solar thermal plant change.

5.8

A single demand is supplied by a hydro plant and an expensive thermal unit over a horizon involving three time periods. The hydro plant has enough capacity to supply the whole demand but the energy content of its reservoir is limited. Analyze the impact on market outcomes (particularly on the total social cost) of an increasing availability of stored energy.

5.9

Consider a single bus system including a demand, a combined cycle gas turbine and a concentrating solar power plant with and without storage, operating over a three-period time horizon. The concentrating solar thermal plant is characterized by four production scenarios. Study how the operation flexibility of the system changes with the size of the storage facility and its operation policy.

5.10

Which flexibility elements should incorporate a fully renewable electric energy system, involving solar, wind and biomass power units?

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Morales, J., Conejo, A., Madsen, H., Pinson, P., Zugno, M. (2014). Managing Uncertainty with Flexibility. In: Integrating Renewables in Electricity Markets. International Series in Operations Research & Management Science, vol 205. Springer, Boston, MA. https://doi.org/10.1007/978-1-4614-9411-9_5

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