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Abstract There has been significant excitement around deployment of grid-connected battery storage around the world including many developing countries. As the cost of battery storage followed the sharp drop in solar and wind, batteries hold immense possibility to transform the power systems in the developing world. However, it will require great care in assessing the specific benefits that a battery storage can provide to the power system as a whole, and developing a business model based on a sound economic analysis. The latter assumes special significance in developing countries where electricity markets are yet to be fully developed in most cases, leaving it to the centralized planning process to undertake such cost-benefit analysis. [ABSTRACT FROM AUTHOR]

Generation investments, especially large-scale variable renewable energy, requires careful scrutiny of the state of the power system. Power system planning and operations in a developing country like Bangladesh can often achieve significant improvements in economics and security of supply, through modest and prudent investments. A review of the Bangladesh power sector is presented in this paper that highlights: (a) changes to dispatch protocols to undertake fuel-constrained dispatch optimization and ancillary services co-optimization and pricing; (b) issues related to the allocation of natural gas between sectors; and (c) a technology neutral investment framework. The study uses an hourly dispatch and ancillary services co-optimization model that also optimizes short to medium term investment decisions. The results demonstrate Bangladesh can: (a) reduce its production costs by 63% through more efficient dispatch; (b) reduce production costs by 77% by using an additional natural gas quota of 212 mmcfd (or a 23% increase); and (c) should have invested in power import and baseload gas/coal rather than expensive solar PV projects (proposed in 2011 at substantially higher cost at the time). When a carbon price is imposed in the model, the implied break even cost to justify the solar program is very high – in excess of $150/tonne. [ABSTRACT FROM AUTHOR]

In this article, we examine the need for integrating resilience against natural disasters in power system planning through a review of the recent literature including guidance notes prepared by multilateral development banks, US Department of Energy and the wider research community. We present the challenges faced by practitioners in implementing resilience-centric analyses, especially in developing countries where data availability is a critical constraint and development of bespoke models for each system/country is an arduous if not an impossible task. This is followed by a discussion on how such planning analysis may still be constructed within the limitation of data, methodology and tools. [ABSTRACT FROM AUTHOR]

This paper presents a multi-nodal intertemporal Cournot gaming model with transmission constraints and uses it to simulate energy-only and capacity-energy market designs in the presence of uncertainties stemming from intermittent renewable power generation. Both market paradigms are compared to a competitive benchmark in order to determine which one performs better in a concentrated market with significant penetration of wind and solar generation. As a specific example, the model is applied to the South Australian zone of the Australian National Electricity Market (NEM). The simulation results for the time interval 2013–2030 show that the capacity-energy market has the potential to induce significant new capacity and push prices much closer to the competitive level in contrast to the current energy-only market design. [ABSTRACT FROM AUTHOR]

Electricity markets have evolved over the years leading to sophisticated spot markets for contingency reserve in operation in a number of countries. This paper proposes a security-constrained optimal power flow based co-optimization of energy and reserve services. The proposed paradigm improves on the existing market clearing engines because it enables an endogenous determination of reserve requirements, allocation of reserve to generators and unbundled energy/reserve prices, to accurately reflect the impact of underlying line/generator contingencies. We highlight the salient aspects of the proposed formulation using a set of numerical examples. Copyright © 2013 John Wiley & Sons, Ltd. [ABSTRACT FROM AUTHOR]

Several least-cost planning studies have suggested a significant shift away from coal toward gas, renewables and potentially nuclear in the long term. Using a Cournot gaming model to analyze the ramifications that market power in Australia's concentrated market may hold for a transition to a low-carbon electricity sector suggests that the substantial influence on price outcomes of some players will need to be fixed before we can have faith in the least-cost carbon abatement strategy. [ABSTRACT FROM AUTHOR]

Wind generation variability in an energy-only market such Australian National Electricity Market (NEM) can create significant revenue uncertainties for incumbent generators and substantially increase price risks faced by retailers. This paper presents a Cournot game model to formally analyze how high volatility of wind generation in a concentrated energy-only market can raise the peak/shoulder period (of typically low wind generation) prices to offset the foregone revenue during off-peak periods (of high wind generation). A Monte Carlo simulation around a Cournot game is formulated as an inter-temporal nonlinear optimization problem to assess these issues. The model is implemented for the South Australian zone of the Australian NEM that has experienced high growth in wind generation in recent years. The model results support some of the observed spot pricing behavior in the region in recent years. These findings have significant ramifications for the efficacy of the energy-only market in scenarios with high penetration of intermittent generation. [ABSTRACT FROM PUBLISHER]

Abstract: Renewable power generation development, most notably for wind and solar, has taken off at a rapid pace in India especially in the last 4 years. While these developments have many positive aspects, a rapid shift in balance of baseload and intermittent generation must be assessed carefully to ensure the share of renewable power generation increases without compromising system security and economics. Seasonal and spatial variability of wind, and to a lesser extent that of solar, can render these resources to have low availability for a significant part of the year leading to an increase in unserved energy, i.e., deteriorate system reliability. The intermittency of generation also impacts on inter-state power flows and lead to higher congestion in the grid. Climate model results provide a rich set of information on the nature of solar/wind variability that can be embedded in an electricity market simulation tool to assess these impacts on prices, generation dispatch and power flows. We have developed a modelling analysis for the Indian national electricity market informed by CSIRO climate model results. We have assessed the added costs arising from intermittency to put in perspective the true costs and benefits of renewable power. We have focused on the near-term developments in 2017 to show how some of the high renewable growth scenarios included in the Indian National Electricity Plan may imply significant pressure on inter-state/region transfer capability, and lead to a significant worsening of system reliability. The outcome of our modelling analysis suggests that a more orderly and balanced development of renewable and conventional power generation capacity is needed with a stronger focus on system economics and security. [Copyright &y& Elsevier]

Though it is still early days, the average cost of CO2 reduction is coming in at AUD 300 per tonne – nearly an order of magnitude higher than the cheapest carbon reduction options available within the electricity sector. At least during the program's first six months, carbon reductions have so far proven far more expensive than was anticipated at the policy formation stage before 2012. [Copyright &y& Elsevier]

The inherent unpredictability and high seasonality of wind and solar resources need to be factored into generation planning to develop a “climate-aware” generation plan that gets the balance right among different generation and import options. Both current and projected generation capacity mix in some parts of India do not reflect a good balance, with significant cost and reliability implications. [ABSTRACT FROM AUTHOR]

India''s high renewable target might be achievable but it comes at a significant cost, given the nation''s already-stressed power system. That''s why it is important to get the policy design right from the beginning. The starting point should be a climate data analysis to assess the resource potential and its spatial and seasonal distribution. [Copyright &y& Elsevier]

There are significant economic, environmental and reliability benefits of power trading among South Asian countries that largely remain unexploited to date. However, a comprehensive regulatory framework to recognize these benefits and to drive investment from beneficiary countries is lacking. It is important that the necessary market arrangements, such as an extension of the power exchanges in India to encompass cross-border trading, are put in place to accelerate the development of interconnectors to reap these benefits. [ABSTRACT FROM AUTHOR]

Policy uncertainty is one of the key issues today that is contributing to investor nervousness, especially when it comes to baseload generation investment. Although there has been considerable discussion on the topic, there has been little effort to formally recognize such uncertainties in investment decision making, to guide appropriate policy developments. This article reviews some of the studies that have been done in the Australian context. [Copyright &y& Elsevier]

Abstract: Carbon costs – either in the form of a carbon tax or through permit prices in an emissions trading scheme – would ultimately be reflected in higher electricity prices. Carbon cost “pass-through” is critical to the survival of existing coal generation assets and has been discussed widely as a measure of business impact in the electricity industry. This paper sets out in a structured way the factors that determine price pass-through and why this may differ greatly across different systems. Although the basic concept of price pass-through is simple, a clear understanding of the underlying factors is critical to developing insights on how carbon cost would impact on existing coal generation businesses. It is shown that pass-through can vary drastically if the underlying dispatch potential of generators varies significantly across alternative emissions reduction scenarios. It can also vary depending on the availability of competing cleaner forms of generation. Pass-through as a measure of business performance is, therefore, hard to generalize across different circumstances and should be interpreted carefully. [Copyright &y& Elsevier]

The Australian electricity sector is expected to undergo major changes to reduce the current sectoral CO2 emission of 190 million tons to 96 million tons by 2050. This paper summarizes two major modeling studies that have been undertaken since 2006 to understand the full set of investment, price and financial impact on existing generators, especially coal-based generators. We have used a long-term capacity and dispatch optimization model to comprehensively analyze both least-cost and market-led expansion of the system to accommodate alternative emission reduction targets from a shallow cut to a deep cut. The modeling results demonstrate the cost of meeting the target can be over $30 billion in NPV terms. A mix of clean coal technologies, gas and nuclear technologies is expected to displace the existing stock of conventional coal which varies significantly depending on the emission reduction target. The analysis also show that mandatory renewable targets or technology standards are inefficient policies in comparison to a market-based policy such as the proposed emissions trading scheme. [ABSTRACT FROM AUTHOR]

This article revisits the stability constrained optimal power flow (SOPF) model originally developed by the authors. One of the limitations of the SOPF model is that the representation of angular stability rests on assumptions that can lead to a sub-optimal dispatch outcome. The present research enhances the SOPF model to improve upon the quality of the solution. This article demonstrates that the feasible set of a stability-constrained optimal power flow problem can be open and hence the optimal solution may not exist. The article then reviews a step-by-step integration (SBSI) based approach which has the limitation of yielding sub-optimal solutions. A primary objective of the present research is to introduce two algorithms that can be used to find an improved solution, starting with a sub-optimal solution. Finally, the article also discusses several implementation issues including the concepts for dealing with multiple contingencies. Numerical examples are presented to illustrate the methodological aspects. [ABSTRACT FROM AUTHOR]

Maintenance decisions in an oligopolistic market attains a strategic dimension because gencos are often able to manipulate market prices through capacity withdrawal. A closely related issue is that of Strategically withholding generation from available capacity. An analytic framework is presented that enables joint evaluation of maintenance and generation strategies. The Cournot-Nash equilibrium (CNE) concept is extended for intertemporal decision making on maintenance and generation for multiple gencos. Each Genco maximizes its profit by strategically putting its capacity on maintenance as well as withholding generation from available capacity, taking into account its rival gencos decisions. The CNE problem is posed as a continuous, or mixed integer, nonlinear programming optimization problem. Duality theory is employed to derive insights about the marginal profit that a genco may earn from an increment in its availability in an oligopolistic market setup. Illustrative numerical examples are presented of CNE maintenance and generation strategies and these are compared and contrasted against those of a perfectly competitive scenario. [ABSTRACT FROM AUTHOR]

Conventional behavioral models such as Cournot to analyze generator behavior do not reflect many of the complexities of advanced electricity markets. Dispatch and pricing in a number of advanced pool-based electricity markets worldwide explicitly recognize the co-optimization of ancillary services as well as transmission constraints. This paper discusses the development and experiments with, a multimarket Cournot model that deals with co-optimization of multiple commodities namely, energy and various classes of ancillary services and deals with transmission constraints that separate these commodity markets spatially. We also discuss the multimarket extension of the Cournot model to deal with bilateral contracts (for energy). A nonlinear programming formulation of the proposed model and the analysis of nodal prices are presented followed by a detailed set of experiments using a simple three-node system. The model is expected to add to understanding of complex interactions between energy and ancillary services markets, and further the impact transmission capacity limits may have on exercise of market power of each of these markets. [ABSTRACT FROM AUTHOR]

Payment for reactive power services is a part of generator revenue in most established electricity markets today. However, such payments do not have a sound technical basis taking into account the critical role dynamic sources of reactive power play in maintaining voltage stability of the power system. It is also expected that the reactive power will eventually be traded under a spot market arrangement as the markets mature. This paper proposes a spot pricing mechanism for reactive power that takes into account the contributions made by generators both by providing reactive power to meet the current demand and also holding reactive power ‘reserve’ to maintain the system voltage stability in the face of a potential contingency. An OPF based dispatch/pricing model is proposed that optimally allocates real and dynamic reactive reserve among the generators to meet a pre-specified voltage stability margin. Nodal MW and MV Ar spot prices are affected by the desired stability margin because an increase in MV Ar and/or MW demand has the cascading effect of increasing the dynamic MV Ar/MW reserve requirement. Simplistic illustrative examples are presented to develop insights on the theoretical premise. Experiments conducted for a reduced New Zealand North Island power system reveal some interesting impacts of the voltage stability constraint on real and reactive power prices. [Copyright &y& Elsevier]

This paper presents a preventive/corrective control model to prevent and correct for voltage instability taking into account the load-shed dynamics. An OPF based model is proposed that provides an integrated framework to determine the optimal location, level, timing, and number of loads to be shed to maintain a pre-specified voltage stability margin (SM). The model essentially evaluates the trade-off among the three attributes for all load buses explicitly taking into account the SM constraint. A statistical approximation procedure to model the distance from point of collapse is introduced for both preventive and corrective modes. The preventive model takes into account multiple contingencies. The aim is to determine optimal controls that satisfy all the contingencies simultaneously. The corrective model is based on linear programming for fast calculation of controls in real-time to correct for voltage instability due to a specific contingency condition. [Copyright &y& Elsevier]

The cost of wind, solar, and most recently battery storage has fallen dramatically over the last decade, providing the economic rationale for their widespread adoption to help mitigate climate change. This, coupled with the low cost of natural gas, has provided a key challenge in the power sector: how to economically and equitably decommission ∼2000 GW of installed coal capacity? Although a significant part of the existing coal capacity is older, inefficient, and unprofitable, there are complex technical, social and economic challenges that remain. This Comment provides a general framework for the key technical, policy, regulatory, and economic areas that need to be addressed. [ABSTRACT FROM AUTHOR]

Comments on a study that developed a framework for assessing price changes in electric power markets. Analysis of how uncertainties affect random price increases; Significance of strategic withholding of capacity to raise electricity prices; Details of a reply to the comments.

Presents a commentary on a study on the valuation of dynamic reactive power support services for transmission access. Issue of investment in reactive power equipment; Comments on the use of the heuristic approach.

Highlights: [•] Shapley Value approach offers a fair and equitable cost allocation. [•] A case study of the Australian Queensland network is presented. [•] Cost allocation is contentious for remote renewable power transmission. [•] Regulatory policies and planning frameworks need to be updated. [ABSTRACT FROM AUTHOR]

• COVID-19 has triggered acute power demand shock to the developing countries like Bangladesh. • Bangladesh may curtail expensive liquid fuel based generation dispatch by reducing the use of expensive peaking capacity. • Further capacity addition may perhaps be delayed for the intervening period up to 2025. • Prospects of using Battery storage to manage evening peak at the wholesale level in Bangladesh. • Balanced power import-export regime with neighboring countries possibly will be beneficial for Bangladesh. COVID-19 highlights impact of sudden and sustained periods of low demand that may have major ramifications for financial viability of utilities. However, these effects may be mitigated to some extent through efficient management of dispatch, adjustment of capital outlay for committed capacity and provides an opportunity to reshape longer term capacity development. These issues are particularly critical for developing countries like Bangladesh where the demand shock was acute from avg. 10 % per-annum (pa) to (−)12 % over April-June 2020. This analysis shows how Bangladesh can significantly curtail expensive liquid fuel based generation dispatch, eliminate the use of expensive peaking capacity and even delay some of its capacity addition for the intervening period up to 2025. Prospects of using Battery storage to manage evening peak at the wholesale level have been explored in the analysis and it demonstrates such investments in the present demand scenario is not economic. On the other hand, a more balanced import-export regime with neighboring countries may be beneficial to manage the seasonal capacity surplus that is likely to grow over the next five years. [ABSTRACT FROM AUTHOR]

Recent studies show that the fast growing expansion of wind power generation may lead to extremely high levels of price volatility in wholesale electricity markets. Storage technologies, regardless of their specific forms, e.g., pump-storage hydro, large-scale, or distributed batteries, are capable of alleviating the extreme price volatility levels due to their energy usage time shifting, fast-ramping, and price arbitrage capabilities. In this paper, we propose a stochastic bilevel optimization model to find the optimal nodal storage capacities required to achieve a certain price volatility level in a highly volatile energy-only electricity market. The decision on storage capacities is made in the upper level problem and the operation of strategic/regulated generation, storage, and transmission players is modeled in the lower level problem using an extended stochastic (Bayesian) Cournot-based game. The South Australia (SA) electricity market, which has recently experienced high levels of price volatility, and a 30-bus IEEE system are considered as the case studies. Our numerical results indicate that 50% price volatility reduction in the SA electricity market can be achieved by installing either 430-MWh regulated storage or 530-MWh strategic storage. In other words, regulated storage firms are more efficient in reducing the price volatility than strategic storage firms. [ABSTRACT FROM PUBLISHER]

Abstract: Investment in transmission for renewable power penetration to the remote grid essentially faces a set of inherent, regulatory, economic and technical challenges. This work investigates these challenges to enhance renewable power integration into the remote grid. This study aims to enhance regulatory policies and associated planning frameworks to be more efficient and justifiable for renewable power integration paradigm. First, a set of leading transmission schemes practiced, or investigated, in different countries are evaluated against the challenges which are obvious for long distance renewable power transmission. Second, a net benefit framework is presented to address the challenging issues of location constrained renewable power penetration into the Queensland network of the Australian grid. The proposed framework incorporates the carbon emission price as an environmental benefit which significantly influences the cost–benefit analysis. This paper discusses the ‘hub approach’ of network integration. The transmission investment cost allocation is addressed here as well. The concepts are verified through the implementation of the proposed framework in four prospective projects of the Queensland network in the Australian national electricity market (NEM). [Copyright &y& Elsevier]

This paper discusses a three-part generation offer strategy that enables generators to put in unbundled variable operating costs and fixed start-up/no-load costs. We then pro- pose methods based on cost sharing axioms to allocate fixed start-up/no-load costs among electricity consumers/load/retailers that take into account equity and rationality considerations. We focus on the single period cost allocation first. We apply three well-known game theoretic axioms: the core, the nucleolus, and the Shapley value. We discuss the relative merits and demerits of each criterion and also explore certain theoretical conditions for the existence of the core and the Shapley value lying inside the core. Finally, the multiperiod start-up cost allocation problem is studied. Allocations based on individual periods vis-à-vis composite allocation for all periods are compared and contrasted. Numerical examples are used to illustrate all theoretical concepts. [ABSTRACT FROM AUTHOR]