The impact of different strategies for generation shift keys (GSKs) on the flow-based market coupling domain: A model-based analysis of Central Western Europe

Abstract

The trading of electricity across zones relies on cross-border capacities, provided by transmission system operators. The target design of the European Union for capacity calculations is flow-based market coupling, a method that provides trading domains while taking into account grid restrictions. Flow-based market coupling heavily relies on Generation Shift Keys, an essential predictive parameter, translating zonal balance changes that originate from market coupling into nodal injections and consequent line flow changes. This analysis quantifies the effect of different Generation Shift Key strategies on the market coupling domains and individual network elements. A strategy entails suppositions regarding which generating units partake in market changes and to what extent. For this, a novel method for base case computations is proposed that relies on matching historical reference flows of network elements. The results show that different strategies substantially alter the shape and size of flow-based market coupling domains and have a statistically significant impact on individual network elements. For many lines, the average line flow sensitivity to market changes differs between 1% and 5% across strategies and up to 10% for a few lines. Furthermore, the analysis details how the n-1 security criterion influences the composition of domain constraints and to what extent network elements are affected by it. Particularly with regard to the planned geographical expansion of flow-based market coupling and changing regulatory demands for transmission system operators, this work attests to the importance of developing accurate and transparent flow-based market coupling parameters and model-based representations.