Uniform purchasing price approach for Vietnam wholesale electricity market: modeling and discussing

Abstract

In Vietnam, the reform of the electricity sector is an urgent need, unbundled and striking to begin a Competitive Electricity Market. The Vietnam electricity day-ahead market model is implemented based on the gross pool model with specific market rules and network constraints. Today, the Vietnam electricity market is operating at the Vietnam Wholesale Electricity Market step but is not yet completed. Due to the long shape of Vietnam territory, an implicit cross-compensation mechanism is applied to create a balance between customers leading to an obstruction to allowing multi-buyers in the electricity market. Therefore, the main aim of this paper is based on the official documents to propose the current mathematical model of the Vietnam electricity day-ahead market using a Mixed Integer Linear Problem, called the Single Buyer Day-Ahead Market model. Then, the Multi Buyer Day-Ahead Market model is implemented to allow multi-buyers to trade in the market. The idea of purchasing uniform prices for multi-buyers using in Italy could be also introduced in the Integrated European Electricity Market in case of large price variations between countries as a mechanism to uniformize the price of energy in Europe for consumers. In this paper, purchasing uniform prices is proposed to provide an explicit cross-compensation mechanism for Vietnam. Eventually, the proposed models are evaluated with four scenarios in two years representing typical days in Vietnam. The results confirm that, on one hand, the proposed market-clearing models can be applied in a real application for any expansion of the market, i.e. the number of suppliers, demands, and bidding areas; on the other hand, the purchasing uniform prices provide an explicit cross-compensation between bidding areas helping to enhance the fairness and the transparency of the market.