A Dynamic Price Zone Partitioning Strategy for Cross-Regional Market Transaction

Abstract

The reform of China’s electricity market continues to deepen, the proportion of cross-regional transactions continues to increase, and the cross-regional power market needs to be further improved. Northern Europe has a relatively mature regional electricity price mechanism, which has great guiding significance for the construction of China’s cross-regional and cross-provincial power market. This paper analyzes the applicability of the Nordic transnational electricity market clearing and congestion management model in China. The cross-regional market clearing method based on Locational Marginal Prices (LMP) and the flow-based (FB) model for cross-regional transmission capacity calculation are used for dynamic price zone partitioning and management. After considering the influence of geographical location and locational marginal electricity price, a k-means clustering model is used for price zone partitioning, and all transaction between price zones can be solved by FB model. A case study based on an IEEE 30-node system demonstrates the effectiveness of the proposed dynamic price zone partitioning strategy, which can better reflect the price signal and realize the optimal allocation of resources.