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Energy Systems and Technologies for the Coming Century ...

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1 IntroductionWith <strong>the</strong> introduction of more intermittent power generation in <strong>the</strong> Nordic power systemit is anticipated that <strong>the</strong>re will be an increased dem<strong>and</strong> <strong>for</strong> regulating power. In <strong>the</strong>Danish system regulating power is currently provided primarily by central power plants,in combination with import/export to Norway <strong>and</strong> Sweden where <strong>the</strong>re is a high share ofhydro power. As a greater portion of <strong>the</strong> electricity provided comes from wind power,less will come from <strong>the</strong>se central plants, thus fur<strong>the</strong>r increasing <strong>the</strong> need <strong>for</strong> regulatingpower from new sources.One way of supplying regulating power capacity from new resources is to activate <strong>the</strong>dem<strong>and</strong> side. This could be resources such as industrial or commercial electricitydem<strong>and</strong>, as well as household electricity dem<strong>and</strong> such as heat pumps, direct electricheating, electrical vehicles <strong>and</strong> o<strong>the</strong>r types of dem<strong>and</strong> that can be controlled with littleor no consequences to <strong>the</strong> end-users. Electricity consumption <strong>for</strong> heating or airconditioning could <strong>for</strong> example be converted into <strong>the</strong>rmal energy (heat or cold) duringone hour, to provide <strong>the</strong> service (desired temperature) at ano<strong>the</strong>r hour; thus involvingstorage of heat or cold <strong>and</strong> <strong>the</strong> shifting of electricity dem<strong>and</strong> from one time to ano<strong>the</strong>r.The FlexPower project involves <strong>the</strong> design <strong>and</strong> simulation of a new market <strong>for</strong> regulatingpower that can work as a supplement to <strong>the</strong> existing market. The project is supported byEnerginet.dk <strong>and</strong> involves <strong>the</strong> following partners: Ea <strong>Energy</strong> Analysis (coordinator),DTU‐Technical University of Denmark, En<strong>for</strong>, Actua, Eurisco, EC Power, SEAS‐NVE<strong>and</strong> Nordjysk Elh<strong>and</strong>el.This paper will describe one of <strong>the</strong> core aspects of this project, namely <strong>the</strong> marketdesign. More in<strong>for</strong>mation about <strong>the</strong> project can be found at: www.flexpower.dk.1.1 Current market <strong>for</strong> regulating powerThe Transmission System Operator (TSO) is responsible <strong>for</strong> <strong>the</strong> overall security ofsupply <strong>and</strong> to ensure a well-functioning electricity market by maintaining <strong>the</strong> electricalbalance in <strong>the</strong> power system, <strong>and</strong> by developing market rules. Electricity production <strong>and</strong>consumption always has to be in balance, <strong>and</strong> 45 minutes be<strong>for</strong>e <strong>the</strong> operating hour <strong>the</strong>task of balancing <strong>the</strong> two is left to Energinet.dk. It maintains this balance via <strong>the</strong>regulating power market, <strong>and</strong> o<strong>the</strong>r markets <strong>for</strong> automatic reserves.In <strong>the</strong> hour of operation, Energinet.dk utilises several types of reserves to ensure <strong>the</strong>stability of <strong>the</strong> system. The reserves can be grouped into automatic <strong>and</strong> manual reserves.Generally speaking, <strong>the</strong> system criteria are initially managed by <strong>the</strong> automatic reserves,which are activated in accordance with frequency deviations or deviation in <strong>the</strong> actualcompared with <strong>the</strong> planed exchange with neighbouring areas. These reserves areexpensive <strong>and</strong> have limited capacity.To anticipate excessive use of automatic reserves <strong>and</strong> in order to re-establish <strong>the</strong>iravailability, regulating power is utilised. Regulating power is a manual reserve <strong>and</strong> isdefined as increased or decreased generation that can be fully activated within 15minutes. Regulating power can also be dem<strong>and</strong> that is increased or decreased. Activationcan start at any time <strong>and</strong> <strong>the</strong> duration can vary.GenerationDem<strong>and</strong>Up‐regulation More LessDown‐regulation Less MoreTable 1: Definition of up <strong>and</strong> down regulationIn <strong>the</strong> Nordic countries <strong>the</strong>re is a common regulating power market managed by <strong>the</strong>TSOs with a common merit order bidding list. The balance responsibles (<strong>for</strong> load orRisø International <strong>Energy</strong> Conference 2011 Proceedings Page 118

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