7 - Electricity market issues in future power systems

Abstract

Power systems have undergone fundamental changes in recent years. One of the most important of these changes is the formation of multiarea markets for economic exchanges among various regions or countries. On the other hand, the growth of distributed energy resources in the structure of smart grids is increasing. Due to these changes, the use of centralized methods to implement electricity markets has created challenges such as heavy computational burden, the availability of confidential markets information to central operators, and how to coordinate among operators. Therefore, decentralized approaches to running multiarea markets and coordination of them can be the beginning of addressing these challenges. In order to use a decentralized structure, the power system first needs to be decomposed based on geographical areas (for multiarea markets) or nodes (usually for P2P markets in smart grids). This chapter describes decentralized approaches considering decomposition-based algorithms for these applications in the electricity market.