Abstract
The use of a zonal structure for energy markets across the globe is expanding; however the debate on how to effectively partition the grid into bidding zones is still open for discussion. One of the factors that needs to be addressed in the process of bidding zones’ delimitation is the transmission system operators control areas. Merging parts of different control areas into one bidding zone can lead to multiple problems, ranging from political, through grid security concerns, to reserve control issues. To address it, this paper presents a novel grid partitioning method aimed at bidding zones delimitation that is based on clustering the power grid using an extended version of the standard agglomerative clustering. The proposed solution adds additional clustering rules when constructing the dendrogram in order to take into account the control areas. The algorithm is applied to the data which represents the locational marginal prices obtained from optimal power flow analysis.
Highlights
The zonal structure of the electricity market in Europe is undergoing a process of transformation [1]
How much efficiency could be increased by introducing a zonal market depends on how the bidding zones are delimited, and designing a robust bidding zone configuration constitutes one of the key issues in adopting this form of energy market. (For a discussion on how the market outcomes depend on the bidding zones configurations see, for example, [6] or, in context of number of bidding zones, [7].) To this end, the approach used in the literature is based on machine learning methods-clustering-that is applied to some characteristics of the nodes or transmission lines of the grid
There are LMP and PTDF-based algorithms that can help in the process of bidding zones delimitation by taking into account economic and technical information about grid topology and generation units
Summary
The zonal structure of the electricity market in Europe is undergoing a process of transformation [1]. The first, quite obvious prerequisite is that each bidding zone must constitute an electrically connected subset of the energy grid, so that the assumption about a bidding zone being a copper plate is plausible—we refer to this requirement as the topological constraints on clustering. This issue was already addressed in the context of zonal market division by [10], and most of the approaches to bidding zones delimitation discussed in Section 3 satisfy this requirement by design.
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