Abstract
This paper analyzes a price-taker hydro generating company which participates simultaneously in day-ahead energy and ancillary services markets. An approach for deriving marginal cost curves for energy and ancillary services is proposed, taking into consideration price uncertainty and opportunity cost of water, which can later be used to determine hourly bid curves. The proposed approach combines an hourly conditional value-at-risk, probability of occurrence of automatic generation control states and an opportunity cost of water to determine energy and ancillary services marginal cost curves. The proposed approach is in a linear constraint form and is easy to implement in optimization problems. A stochastic model of the hydro-economic river basin is presented, based on the actual Vinodol hydropower system in Croatia, with a complex three-dimensional relationship between the power produced, the discharged water, and the head of associated reservoir.
Highlights
This paper formulates a hydro-economic river basin model (HERBM) of a price-taking hydro generating company (GENCO, Zagreb, Croatia) which participates in a simultaneous energy and ancillary services day-ahead markets (DAMs) [1,2,3,4,5]
DAM considered here the independent system operator (ISO) will commit GENCOs in a similar way as ISO did in the vertically integrated structure using security constrained unit commitment (SCUC). Suppliers submit their bids to supply the forecasted daily inelastic demand and ISO uses the bid-in costs submitted by GENCOs for each generating unit to minimize cost of operation and determine which units will be dispatched in how many hours and calculate the corresponding market clearing prices (MCPs) while the system security is retained The prices of energy and ancillary services are set at the shadow price of the market clearing constraints for the corresponding product and as a result, generating units are dispatched to maximize their profits given the prices of energy and ancillary services
Real hydropower system (HPS) Vinodol is already used for frequency regulation ancillary services
Summary
This paper formulates a hydro-economic river basin model (HERBM) of a price-taking hydro generating company (GENCO, Zagreb, Croatia) which participates in a simultaneous energy and ancillary services day-ahead markets (DAMs) [1,2,3,4,5]. For a more realistic approach, a water shadow price should change over the planning horizon every time the reservoir capacity constraints are reached [9,10] This was the case in this research. This paper analyzes the price-taker hydro GENCO which participates simultaneously in energy and ancillary services DAMs. This paper contributes to the previous works [7,8,9,10] with the approach which combines innovative usage of the hourly CVaR, the probability of occurrence of AGC states and the opportunity cost of water to determine the energy and ancillary services marginal cost curves and to determine a bid prices for energy and ancillary services.
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