The value of grid information in flow-based market clearing

The Nordic power market undergoes significant changes, which all the market stakeholders, including power producers, system operators and market operators need to prepare for. In addition to the significant integration of intermittent renewable energy sources, one of the most important changes is the transition to a flow-based market clearing (FBMC). This market clearing procedure is in line with the European target model and a framework is defined in the European network codes. Flow-based market clearing includes a better physical representation of the transmission system in the market clearing procedure, which leads to better utilisation of the existing transmission infrastructure. While the transmission system is utilised better, this can also have a significant effect on the economics of power system stakeholders, such as the operation of hydropower plants. Hence, the project Vannfly aims to assess the effect of introducing FBMC in the Nordic power market for different stakeholders. An important part of the study is to investigate, which amount of information on the transmission system is necessary for participants in the Nordic power market to account for the introduction of FBMC in price forecasting and operation planning processes. For the study SINTEF Energy Research will further develop and apply an existing prototype model, which can be used for long-term price forecasting and includes a detailed description of the Nordic hydropower as well as the transmission system. Furthermore, an existing market model will be adapted to include FBMC, enabling stakeholders to study effects of FBMC more thoroughly and do price forecasting in a FBMC setting after finalization of the project. analyses and organised a number of project meetings and workshops. The project has followed up the ongoing process at Nordic CCM, which works with the implementation of FBMC in the Nordic region. In order to be able to carry out analyses, the existing prototype model tool (FanSi) is adapted to the use of detailed web description and exogenous PTDF description. In addition, it is decided and specified which type of decision support tool is to be further developed in the project to be made available to the project partners for their own analyses. The analyses have been carried out based on a Nordic data set that has been developed together with other research projects (FME HydroCen, IPN SumEffekt). Preliminary results show significant consequences of the introduction of FBMC and an effect of considering detailed networks in short-term market simulation, while the value of network descriptions for the long-term strategy calculation is still uncertain. This will be one of the focus areas for the rest of the project.

The Nordic power market undergoes a significant change, which all of the market stakeholders need to prepare for. One of the most important changes is the transition to a flow-based market clearing (FBMC), in line with the European target model. The project Vannfly aims to assess the effect of introducing FBMC in the Nordic power market and to ensure that project participants increase their competence on the new market clearing mechanism. An important part is to study effects of different levels of grid information. Furthermore, through workshops discussing FBMC implementation project participants can affect the implementation process of flow-based market clearing in the Nordic power markets through questions and requests to the process. Market stakeholders need to be part of the process to ensure that sufficient grid information is provided, so that FBMC is implemented in a way that market actors can act rationally. The project will use newly developed prototype models from SINTEF Energy Research to study the level of information from the grid operator that will be most useful for the actors in the energy market. If the analyses using a market model result in a suitable level of information (a level which gives improved model prediction results), the project aims to implement a prototype model to provide the possibility to study effects of FBMC more thoroughly after finalization of the project. A successful project will result in better understanding of the new market model and benefit the FBMC implementation by trying to ensure that the information provided by the grid operators is the information that the power producers require in their actions in the energy market.