Analysis Tools: Single-node Market

Introduction to the ENERGY market game

Objectives

The main objectives of the game are:

To produce an approach to processes and tools used in competitive electricity markets.
Through the collective simulation of a “Day-Ahead Market”, the aim is to experiment with the decision making underlying alternative forms of markets.
Opportunity for practical evaluation of a simple exhange-type market model, applied to conditions inspired by the SIC’s hydrothermal system.

Model inspired by the Spanish electricity market (1998)

The Spanish electricity production market began operations on January 1st, 1998. Its operation is coordinated by two institutions: a market operator (MO), in charge of the financial part; and a network or system operator (SO), in charge of the technical feasibility of the system operation.

The production market comprises medium and long-term physical bilateral contracts, and daily and intraday market. Likewise, ancillary services are traded in a separate market so that the quality, reliability and security conditions established by law are respected.

In the daily market, bids for sale and purchase of electricity are included in a matching process for a daily scheduling horizon (day-ahead), considering 24 hourly periods. Sellers submit bids for each production unit they own and for each hourly period. The required production unit data are as follows:

Production unit code.
Production unit description.
Production unit type.
Type of offer (purchase or sale).
Electric system code to which it belongs.
Minimum and maximum hourly energy in MWh.
Maximum gradient of rise, fall, start and stop, in MWh/min (0 = no limit).
Indication of whether the hydraulic unit corresponds to run-of-the-river plant.

Description of the Energy Market Game activity

The so-called “Energy Market Game” is an intra-university group activity in which students (participants) get together to represent an agent of the electricity market in a virtual electricity market.
An electric company that buys or produces electricity is randomly assigned to each group of participants and, through a simple matching, a price and energy balance between supply and demand is determined. In other words, a simplified day-ahead market operation is simulated day by day.
Bidders must consider the technical characteristics of the facilities assigned to them, generally based on the generating companies of the SIC electricity market, to send an offer to SELL energy via web.
Buyers, associated to the reality of the SIC distributors, send by the same means their offers, this time for the PURCHASE of energy.
The market operator collects the daily bids and then, by means of a linear optimization algorithm, performs the auction, i.e., obtains the point where the aggregate supply and demand intersect. This price and clearing price is published on the activity’s website and the individualized energy sales/purchases are sent to each of the registered participants privately.

Simple Clearing Procedure

The electricity bids and offers are included in a clearing process for a daily scheduling horizon (day-ahead), considering 24 hourly periods. Sellers submit offers for each production unit they own and for each hourly period. The matching (auction) is the calculation of the supply-demand equilibrium. The procedure consists in the construction of the aggregate supply and demand curves. The equilibrium point is considered to occur at the intersection of the supply and demand curves

Types of offers

Simple offers are the economic offers of electricity for each production period and per unit production, with a price and a quantity of energy, being able to exist for each hourly period within the production horizon up to a maximum of 25 blocks of energy with a different price for each block, in an increasing manner. The bids do not include additional conditions that must be considered for matching.

Complex offers are those that meet the conditions of simple offers and also incorporate one or more of the following conditions:

Indivisibility condition.
Minimum income condition.
Scheduled shutdown condition.
Production capacity variation or load gradient condition.

Clearing algorithm

The simple clearing procedure is shown in Figure 67 (a). For complex bids, a successive solution improvement algorithm is required as illustrated in Figure 67 (b).

(a) Graphical representation of simple clearing

(b) Simple/complex clearing algorithm

Figure 67: Single-node clearing procedure

Enter Offer/bid to sell/buy electricity in the day-ahead market

This section describes how to make an offer/bid through the DeepEdit system.

Figure 68: Single-node interface for entering a bid

User fields

Usuario: Enter the username.
Clave: Enter the assigned password.

Opciones Generales

Participa: Define whether the offer/bid should be considered (disabled).

Control de opciones

Cargar BD: Load offer/bid file. The path to the file on the local hard disk must be specified.

Recommendation: ONLY use to load files generated by “Guardar DB” (see below). It is NOT recommended to edit this file directly. Advanced users can perform this operation by generating directly with Excel, MSAccess or other spreadsheets respecting the proper nomenclature.

Guardar BD: Saves the entered offer/bid temporarily on the local hard disk. The path must be specified (only on Windows).

Recommendation: Save file specifying file name including .TXT. It is NOT recommended to edit this file directly. However, advanced users can view the file directly with Excel, MSAccess or another spreadsheet, separating the text into column.

Nueva: Opens the offer/bid editing window with all fields initialized to zero.
Editar: Opens the offer/bid editing window with the temporarily stored offer/bid. The offer/bid can be modified in three different ways:
Filling a new offer/bid.
Editing an offer/bid stored in a text file from the local hard > drive.
Editing the current valid server offer/bid (see below).
Editar BD Actual: Allows to temporarily load the official offer/bid store on the server. Recommended uses:
Validation: Check the correct data transmission to the server. It is > especially recommended for large bets or in cases where there are > doubts about the successful transmission of data.
Minor modifications: The server allows infinite corrections of the > current offer from usually 16:00hr to 12:00hrs of the next day.

Figure 69: Single-node interface. Temporary bid editing tools

Enviar: Sending the offer/buy to the DeepEdit server.

IMPORTANT NOTE: At each sending, the modified fields are not updated with respect to those stored in the server, instead, the new offer/bid overwrites all previous fields. That is, new bets, containing changes with respect to the one stored on the server, must be sent “complete”.

Ayuda: Open the help file. Some pop-ups blockers may block this operation, consult the manufacturer to display popup windows.
Salir: Exit the program.
Graficar: Plot the offer/bid.

Temporary offer/bid entry

Figure 70: Single-node interface. Offer editing window

Pegar de Excel: Allows copying data of the current hour from the clipboard.
Copiar H-1: Allows to copy data of the previous hour, avoiding typing work.
Guardar: Temporarily saves the offer/bid. It is defined as temporary because it is stored locally and will be available until it is sent or edited again, or the application is exited.
Salir: Exit the offer/bid editor without saving changes.

IMPORTANT NOTE: The ONLY accepted format for numbers is the one whose decimals are separated by a DOT (.), it doesn’t accept commas neither to separate decimals nor separate thousands. In MS Excel, the format of numbers depends on the regional settings, typical settings in Spain and Latin America use the comma (,) as decimal separator. To avoid errors, it’s recommended to change the settings (Control Panel -> Regional configuration).

The following graphs show the points to be delivered in the electricity offers/bids in the respective frame.

Figure 71: Energy bid example (3 blocks)

Block 1: PT1, ET1

Block 2: PT2,ET2

Block 3: PT3,ET3

Figure 72: Energy offer example (3 blocks)

Block 1: PT3, ET1