Power market operation 발표

37
Power Planning Power Market Power System Power Market Operation Sang-Jin Chung T &J Construction. Co. Ltd +82-10-5234-6134 [email protected]

Transcript of Power market operation 발표

Power PlanningPower Market

Power System

Power Market Operation

Sang-Jin Chung T ampJ Construction Co Ltd

+82-10-5234-6134sjchungkpxorkr

Copyright 2011 by KPX co Ltd All rights reserved

IIII

II

IIIIII

Power Business Overview

Electricity Market

Recent Market Results

Market IssuesⅣⅣⅣⅣ

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Power Business Overview

II

Electric Power SystemGeneration Sites amp Fuel MixTransmission System NetworkPeak Demand amp Capacity Margin

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

NamjejuSeogwipoAndukSin-Jeju

HanlaSungsan

JocheonDong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

UijeongbuSungdong

HwasungSin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-GangjinHaenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PPMuju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-MasanSin-Gimhae

Bukbusan

Pusan CC Nam-Pusan

Kori NPSin-Onsan

Ulsan TP CC

Wolseong NPSeo-DaeguBuk-Daegu

Sunsan

GoryeongDaeguSin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Sin-Yangsan

Sin-Youngin

Sin-SungnamDong-Seoul

Migum

Gonjiam

CHARACTERISTICS Isolated power grid within Korean peninsular

High growth rates of power consumption

- Annual increase rates middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66 lsquo06-rsquo10 56

Highly dependent on foreign energy resources

- 964 of primary energy imported (232 million toe lsquo08)

Primary energy resources - Oil 431 Coal 276 LNG 153 Nuclear 140

KEY STATISTICS (2010) People served (million) 50 Generating capacity (MW) 76078 Peak loads (MW) 71308 Total transmission lines (C-Km) 30676 Electricity traded annually (GWh) 406000 Generators (above 20MW) 372 ea

4

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Bundang

Seoul

Sanchung

HapchunCheongsong

IncheonPucheon

Pyungtaek

Anyang

Youngkwang

Chungju

Chuam

Yeosu

Honam Kwangyang

Sumjinkang

YongdamMuju

SeocheonBoryeong

POSCO

Sin-Incheon Paldnag

Chungpyung

Euiam

ChuncheonHwachun

Hadong

Samrangjin

SamcheonpoBusan

Kori

Andong

Yangyang

Kangreung

Uljin

Imha

Youngnam

Wolseong

Small Hydro (Pocheon etc)

Soyangkang

Ilsan

Youngheung

TaeanLGBugok

Ulsan

Daechung

Dangjin

Seo-Incheon YoungdongDonghae

Yulchon

Jeju

(Unit 10 MW)

53180

99

120

180

5048

45 905045

180 180

180

90

4033

74

50

40

400 300

180

300

400

40

247140

39

400

115

53

590

278

314590

6

60

10011

128

720

2

3

2

959

60

41

40

60 10

70

65Chungpyung

As of Dec 31 2010

Capacity by Fuels(Unit MW)

Nuclear17716(233

)Oil5805(76

)Hydro5524(73

)Renewable1762(23) Coal

24800(326)

LNG20471(269)

5

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Characteristics

Direct Current Line- Connect the main land to Jeju Island

345kVMain transmission system

Distribution system- Connected to major areas of consumption

154kV

Second HVDC Line between main land and Jeju island is being built by 2012( 300MW rArr 700MW)

765kVMass transmission system

(Unit C-km Numbers of SS)

154kV 20700 628345kV 8552 88765kV 755 6Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

Namjeju SeogwipoAnduk Sin-Jeju

Hanla

Sungsan

Jocheon

Dong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

Uijeongbu

Sungdong

Hwasung

Sin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-Gangjin

Haenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PP

Muju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-Masan

Sin-Gimhae

Bukbusan

Pusan CCNam-Pusan

Kori NP

Sin-Onsan

Ulsan TP CC

Wolseong NPSeo-Daegu

Buk-DaeguSunsan

GoryeongDaegu

Sin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Gwangyang Steel

Sin-Yangsan

Sin-Youngin

Sin-Sungnam

Dong-Seoul

Migum

Gonjiam

Hadong TPSamcheonpo TPPusan CC

Gwangyang Steel

6

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

A peak demand of 71GW occurred on Dec 15 2010bull68 increase compared to the last yearlsquos peak bullHigher than expected due to the extended cold waves

The capacity margin was just around 62 (the lowest since 2001)bullHas gradually decreased due to the delayed construction in facilities

bullMay improve from 2012 with the generator additions

45000

50000

70000 (UnitMW)

65000

60000

55000

rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10

62790(08)

62290(56)

54630(66)51260

(82)

58990(80)

Reserve margin

As of Dec 2010 71308(68)

Peak demand(Growth rate)

122 113

105

72 91

62

66800(64)

79

rsquo09

7

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

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Copyright 2011 by KPX co Ltd All rights reserved

IIII

II

IIIIII

Power Business Overview

Electricity Market

Recent Market Results

Market IssuesⅣⅣⅣⅣ

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Power Business Overview

II

Electric Power SystemGeneration Sites amp Fuel MixTransmission System NetworkPeak Demand amp Capacity Margin

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

NamjejuSeogwipoAndukSin-Jeju

HanlaSungsan

JocheonDong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

UijeongbuSungdong

HwasungSin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-GangjinHaenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PPMuju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-MasanSin-Gimhae

Bukbusan

Pusan CC Nam-Pusan

Kori NPSin-Onsan

Ulsan TP CC

Wolseong NPSeo-DaeguBuk-Daegu

Sunsan

GoryeongDaeguSin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Sin-Yangsan

Sin-Youngin

Sin-SungnamDong-Seoul

Migum

Gonjiam

CHARACTERISTICS Isolated power grid within Korean peninsular

High growth rates of power consumption

- Annual increase rates middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66 lsquo06-rsquo10 56

Highly dependent on foreign energy resources

- 964 of primary energy imported (232 million toe lsquo08)

Primary energy resources - Oil 431 Coal 276 LNG 153 Nuclear 140

KEY STATISTICS (2010) People served (million) 50 Generating capacity (MW) 76078 Peak loads (MW) 71308 Total transmission lines (C-Km) 30676 Electricity traded annually (GWh) 406000 Generators (above 20MW) 372 ea

4

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Bundang

Seoul

Sanchung

HapchunCheongsong

IncheonPucheon

Pyungtaek

Anyang

Youngkwang

Chungju

Chuam

Yeosu

Honam Kwangyang

Sumjinkang

YongdamMuju

SeocheonBoryeong

POSCO

Sin-Incheon Paldnag

Chungpyung

Euiam

ChuncheonHwachun

Hadong

Samrangjin

SamcheonpoBusan

Kori

Andong

Yangyang

Kangreung

Uljin

Imha

Youngnam

Wolseong

Small Hydro (Pocheon etc)

Soyangkang

Ilsan

Youngheung

TaeanLGBugok

Ulsan

Daechung

Dangjin

Seo-Incheon YoungdongDonghae

Yulchon

Jeju

(Unit 10 MW)

53180

99

120

180

5048

45 905045

180 180

180

90

4033

74

50

40

400 300

180

300

400

40

247140

39

400

115

53

590

278

314590

6

60

10011

128

720

2

3

2

959

60

41

40

60 10

70

65Chungpyung

As of Dec 31 2010

Capacity by Fuels(Unit MW)

Nuclear17716(233

)Oil5805(76

)Hydro5524(73

)Renewable1762(23) Coal

24800(326)

LNG20471(269)

5

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Characteristics

Direct Current Line- Connect the main land to Jeju Island

345kVMain transmission system

Distribution system- Connected to major areas of consumption

154kV

Second HVDC Line between main land and Jeju island is being built by 2012( 300MW rArr 700MW)

765kVMass transmission system

(Unit C-km Numbers of SS)

154kV 20700 628345kV 8552 88765kV 755 6Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

Namjeju SeogwipoAnduk Sin-Jeju

Hanla

Sungsan

Jocheon

Dong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

Uijeongbu

Sungdong

Hwasung

Sin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-Gangjin

Haenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PP

Muju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-Masan

Sin-Gimhae

Bukbusan

Pusan CCNam-Pusan

Kori NP

Sin-Onsan

Ulsan TP CC

Wolseong NPSeo-Daegu

Buk-DaeguSunsan

GoryeongDaegu

Sin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Gwangyang Steel

Sin-Yangsan

Sin-Youngin

Sin-Sungnam

Dong-Seoul

Migum

Gonjiam

Hadong TPSamcheonpo TPPusan CC

Gwangyang Steel

6

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

A peak demand of 71GW occurred on Dec 15 2010bull68 increase compared to the last yearlsquos peak bullHigher than expected due to the extended cold waves

The capacity margin was just around 62 (the lowest since 2001)bullHas gradually decreased due to the delayed construction in facilities

bullMay improve from 2012 with the generator additions

45000

50000

70000 (UnitMW)

65000

60000

55000

rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10

62790(08)

62290(56)

54630(66)51260

(82)

58990(80)

Reserve margin

As of Dec 2010 71308(68)

Peak demand(Growth rate)

122 113

105

72 91

62

66800(64)

79

rsquo09

7

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
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  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
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  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
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  • Slide 28
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  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Power Business Overview

II

Electric Power SystemGeneration Sites amp Fuel MixTransmission System NetworkPeak Demand amp Capacity Margin

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

NamjejuSeogwipoAndukSin-Jeju

HanlaSungsan

JocheonDong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

UijeongbuSungdong

HwasungSin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-GangjinHaenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PPMuju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-MasanSin-Gimhae

Bukbusan

Pusan CC Nam-Pusan

Kori NPSin-Onsan

Ulsan TP CC

Wolseong NPSeo-DaeguBuk-Daegu

Sunsan

GoryeongDaeguSin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Sin-Yangsan

Sin-Youngin

Sin-SungnamDong-Seoul

Migum

Gonjiam

CHARACTERISTICS Isolated power grid within Korean peninsular

High growth rates of power consumption

- Annual increase rates middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66 lsquo06-rsquo10 56

Highly dependent on foreign energy resources

- 964 of primary energy imported (232 million toe lsquo08)

Primary energy resources - Oil 431 Coal 276 LNG 153 Nuclear 140

KEY STATISTICS (2010) People served (million) 50 Generating capacity (MW) 76078 Peak loads (MW) 71308 Total transmission lines (C-Km) 30676 Electricity traded annually (GWh) 406000 Generators (above 20MW) 372 ea

4

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Bundang

Seoul

Sanchung

HapchunCheongsong

IncheonPucheon

Pyungtaek

Anyang

Youngkwang

Chungju

Chuam

Yeosu

Honam Kwangyang

Sumjinkang

YongdamMuju

SeocheonBoryeong

POSCO

Sin-Incheon Paldnag

Chungpyung

Euiam

ChuncheonHwachun

Hadong

Samrangjin

SamcheonpoBusan

Kori

Andong

Yangyang

Kangreung

Uljin

Imha

Youngnam

Wolseong

Small Hydro (Pocheon etc)

Soyangkang

Ilsan

Youngheung

TaeanLGBugok

Ulsan

Daechung

Dangjin

Seo-Incheon YoungdongDonghae

Yulchon

Jeju

(Unit 10 MW)

53180

99

120

180

5048

45 905045

180 180

180

90

4033

74

50

40

400 300

180

300

400

40

247140

39

400

115

53

590

278

314590

6

60

10011

128

720

2

3

2

959

60

41

40

60 10

70

65Chungpyung

As of Dec 31 2010

Capacity by Fuels(Unit MW)

Nuclear17716(233

)Oil5805(76

)Hydro5524(73

)Renewable1762(23) Coal

24800(326)

LNG20471(269)

5

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Characteristics

Direct Current Line- Connect the main land to Jeju Island

345kVMain transmission system

Distribution system- Connected to major areas of consumption

154kV

Second HVDC Line between main land and Jeju island is being built by 2012( 300MW rArr 700MW)

765kVMass transmission system

(Unit C-km Numbers of SS)

154kV 20700 628345kV 8552 88765kV 755 6Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

Namjeju SeogwipoAnduk Sin-Jeju

Hanla

Sungsan

Jocheon

Dong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

Uijeongbu

Sungdong

Hwasung

Sin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-Gangjin

Haenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PP

Muju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-Masan

Sin-Gimhae

Bukbusan

Pusan CCNam-Pusan

Kori NP

Sin-Onsan

Ulsan TP CC

Wolseong NPSeo-Daegu

Buk-DaeguSunsan

GoryeongDaegu

Sin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Gwangyang Steel

Sin-Yangsan

Sin-Youngin

Sin-Sungnam

Dong-Seoul

Migum

Gonjiam

Hadong TPSamcheonpo TPPusan CC

Gwangyang Steel

6

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

A peak demand of 71GW occurred on Dec 15 2010bull68 increase compared to the last yearlsquos peak bullHigher than expected due to the extended cold waves

The capacity margin was just around 62 (the lowest since 2001)bullHas gradually decreased due to the delayed construction in facilities

bullMay improve from 2012 with the generator additions

45000

50000

70000 (UnitMW)

65000

60000

55000

rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10

62790(08)

62290(56)

54630(66)51260

(82)

58990(80)

Reserve margin

As of Dec 2010 71308(68)

Peak demand(Growth rate)

122 113

105

72 91

62

66800(64)

79

rsquo09

7

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

NamjejuSeogwipoAndukSin-Jeju

HanlaSungsan

JocheonDong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

UijeongbuSungdong

HwasungSin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-GangjinHaenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PPMuju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-MasanSin-Gimhae

Bukbusan

Pusan CC Nam-Pusan

Kori NPSin-Onsan

Ulsan TP CC

Wolseong NPSeo-DaeguBuk-Daegu

Sunsan

GoryeongDaeguSin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Sin-Yangsan

Sin-Youngin

Sin-SungnamDong-Seoul

Migum

Gonjiam

CHARACTERISTICS Isolated power grid within Korean peninsular

High growth rates of power consumption

- Annual increase rates middot lsquo91-rsquo95 109 lsquo96-rsquo00 74 lsquo01-rsquo05 66 lsquo06-rsquo10 56

Highly dependent on foreign energy resources

- 964 of primary energy imported (232 million toe lsquo08)

Primary energy resources - Oil 431 Coal 276 LNG 153 Nuclear 140

KEY STATISTICS (2010) People served (million) 50 Generating capacity (MW) 76078 Peak loads (MW) 71308 Total transmission lines (C-Km) 30676 Electricity traded annually (GWh) 406000 Generators (above 20MW) 372 ea

4

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Bundang

Seoul

Sanchung

HapchunCheongsong

IncheonPucheon

Pyungtaek

Anyang

Youngkwang

Chungju

Chuam

Yeosu

Honam Kwangyang

Sumjinkang

YongdamMuju

SeocheonBoryeong

POSCO

Sin-Incheon Paldnag

Chungpyung

Euiam

ChuncheonHwachun

Hadong

Samrangjin

SamcheonpoBusan

Kori

Andong

Yangyang

Kangreung

Uljin

Imha

Youngnam

Wolseong

Small Hydro (Pocheon etc)

Soyangkang

Ilsan

Youngheung

TaeanLGBugok

Ulsan

Daechung

Dangjin

Seo-Incheon YoungdongDonghae

Yulchon

Jeju

(Unit 10 MW)

53180

99

120

180

5048

45 905045

180 180

180

90

4033

74

50

40

400 300

180

300

400

40

247140

39

400

115

53

590

278

314590

6

60

10011

128

720

2

3

2

959

60

41

40

60 10

70

65Chungpyung

As of Dec 31 2010

Capacity by Fuels(Unit MW)

Nuclear17716(233

)Oil5805(76

)Hydro5524(73

)Renewable1762(23) Coal

24800(326)

LNG20471(269)

5

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Characteristics

Direct Current Line- Connect the main land to Jeju Island

345kVMain transmission system

Distribution system- Connected to major areas of consumption

154kV

Second HVDC Line between main land and Jeju island is being built by 2012( 300MW rArr 700MW)

765kVMass transmission system

(Unit C-km Numbers of SS)

154kV 20700 628345kV 8552 88765kV 755 6Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

Namjeju SeogwipoAnduk Sin-Jeju

Hanla

Sungsan

Jocheon

Dong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

Uijeongbu

Sungdong

Hwasung

Sin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-Gangjin

Haenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PP

Muju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-Masan

Sin-Gimhae

Bukbusan

Pusan CCNam-Pusan

Kori NP

Sin-Onsan

Ulsan TP CC

Wolseong NPSeo-Daegu

Buk-DaeguSunsan

GoryeongDaegu

Sin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Gwangyang Steel

Sin-Yangsan

Sin-Youngin

Sin-Sungnam

Dong-Seoul

Migum

Gonjiam

Hadong TPSamcheonpo TPPusan CC

Gwangyang Steel

6

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

A peak demand of 71GW occurred on Dec 15 2010bull68 increase compared to the last yearlsquos peak bullHigher than expected due to the extended cold waves

The capacity margin was just around 62 (the lowest since 2001)bullHas gradually decreased due to the delayed construction in facilities

bullMay improve from 2012 with the generator additions

45000

50000

70000 (UnitMW)

65000

60000

55000

rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10

62790(08)

62290(56)

54630(66)51260

(82)

58990(80)

Reserve margin

As of Dec 2010 71308(68)

Peak demand(Growth rate)

122 113

105

72 91

62

66800(64)

79

rsquo09

7

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Bundang

Seoul

Sanchung

HapchunCheongsong

IncheonPucheon

Pyungtaek

Anyang

Youngkwang

Chungju

Chuam

Yeosu

Honam Kwangyang

Sumjinkang

YongdamMuju

SeocheonBoryeong

POSCO

Sin-Incheon Paldnag

Chungpyung

Euiam

ChuncheonHwachun

Hadong

Samrangjin

SamcheonpoBusan

Kori

Andong

Yangyang

Kangreung

Uljin

Imha

Youngnam

Wolseong

Small Hydro (Pocheon etc)

Soyangkang

Ilsan

Youngheung

TaeanLGBugok

Ulsan

Daechung

Dangjin

Seo-Incheon YoungdongDonghae

Yulchon

Jeju

(Unit 10 MW)

53180

99

120

180

5048

45 905045

180 180

180

90

4033

74

50

40

400 300

180

300

400

40

247140

39

400

115

53

590

278

314590

6

60

10011

128

720

2

3

2

959

60

41

40

60 10

70

65Chungpyung

As of Dec 31 2010

Capacity by Fuels(Unit MW)

Nuclear17716(233

)Oil5805(76

)Hydro5524(73

)Renewable1762(23) Coal

24800(326)

LNG20471(269)

5

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Characteristics

Direct Current Line- Connect the main land to Jeju Island

345kVMain transmission system

Distribution system- Connected to major areas of consumption

154kV

Second HVDC Line between main land and Jeju island is being built by 2012( 300MW rArr 700MW)

765kVMass transmission system

(Unit C-km Numbers of SS)

154kV 20700 628345kV 8552 88765kV 755 6Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

Namjeju SeogwipoAnduk Sin-Jeju

Hanla

Sungsan

Jocheon

Dong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

Uijeongbu

Sungdong

Hwasung

Sin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-Gangjin

Haenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PP

Muju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-Masan

Sin-Gimhae

Bukbusan

Pusan CCNam-Pusan

Kori NP

Sin-Onsan

Ulsan TP CC

Wolseong NPSeo-Daegu

Buk-DaeguSunsan

GoryeongDaegu

Sin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Gwangyang Steel

Sin-Yangsan

Sin-Youngin

Sin-Sungnam

Dong-Seoul

Migum

Gonjiam

Hadong TPSamcheonpo TPPusan CC

Gwangyang Steel

6

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

A peak demand of 71GW occurred on Dec 15 2010bull68 increase compared to the last yearlsquos peak bullHigher than expected due to the extended cold waves

The capacity margin was just around 62 (the lowest since 2001)bullHas gradually decreased due to the delayed construction in facilities

bullMay improve from 2012 with the generator additions

45000

50000

70000 (UnitMW)

65000

60000

55000

rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10

62790(08)

62290(56)

54630(66)51260

(82)

58990(80)

Reserve margin

As of Dec 2010 71308(68)

Peak demand(Growth rate)

122 113

105

72 91

62

66800(64)

79

rsquo09

7

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Characteristics

Direct Current Line- Connect the main land to Jeju Island

345kVMain transmission system

Distribution system- Connected to major areas of consumption

154kV

Second HVDC Line between main land and Jeju island is being built by 2012( 300MW rArr 700MW)

765kVMass transmission system

(Unit C-km Numbers of SS)

154kV 20700 628345kV 8552 88765kV 755 6Jeju TP

Yangju

Seo-Incheon

Youngheung TP

Hanrim CC

Namjeju SeogwipoAnduk Sin-Jeju

Hanla

Sungsan

Jocheon

Dong-Jeju

Sanji

Seo-Incheon CC

Incheon TP CCSin-Incheon

Sin-Sihung

Sin-Bupyung

Sin-Dukheun

ChungbuYoungdeungpo

Youngseo

Seo-seoul

Uijeongbu

Sungdong

Hwasung

Sin-suwonPyungtaek TP CC

AnsanSin-DangjinDangjin TP

Taean TP

Sin-onyang

Boryeong TP CC Chungyang

Gunsan

Sin-Gimje

Youngwang NP

Sin-Gwangju

Sin-Hwasun

Sin-Gangjin

Haenam CSYeosu NP

GwangyangHadong TP

Sin-Namwon Euiryong

Sancheong PP

Muju PP

Sin-OkcheonSinkaedong

Chungwon

Sin-Jincheon

Sin-Gosung

Samcheonpo TP

In-Masan

Sin-Gimhae

Bukbusan

Pusan CCNam-Pusan

Kori NP

Sin-Onsan

Ulsan TP CC

Wolseong NPSeo-Daegu

Buk-DaeguSunsan

GoryeongDaegu

Sin-Kyeongsan

UljuSin-Ulsan

Sin-Youngju

Sin-Youngil

Cheongsong PP

Uljin NP

Donghae

Yangyang PP

Sin-Jecheon

Sin-Gapyung

Sin-Ansung

Sin-seosan

Sin-Yangje

Sin-Ansan

Sin-Taebaek

Gwangyang Steel

Sin-Yangsan

Sin-Youngin

Sin-Sungnam

Dong-Seoul

Migum

Gonjiam

Hadong TPSamcheonpo TPPusan CC

Gwangyang Steel

6

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

A peak demand of 71GW occurred on Dec 15 2010bull68 increase compared to the last yearlsquos peak bullHigher than expected due to the extended cold waves

The capacity margin was just around 62 (the lowest since 2001)bullHas gradually decreased due to the delayed construction in facilities

bullMay improve from 2012 with the generator additions

45000

50000

70000 (UnitMW)

65000

60000

55000

rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10

62790(08)

62290(56)

54630(66)51260

(82)

58990(80)

Reserve margin

As of Dec 2010 71308(68)

Peak demand(Growth rate)

122 113

105

72 91

62

66800(64)

79

rsquo09

7

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

A peak demand of 71GW occurred on Dec 15 2010bull68 increase compared to the last yearlsquos peak bullHigher than expected due to the extended cold waves

The capacity margin was just around 62 (the lowest since 2001)bullHas gradually decreased due to the delayed construction in facilities

bullMay improve from 2012 with the generator additions

45000

50000

70000 (UnitMW)

65000

60000

55000

rsquo04 rsquo05 rsquo06 rsquo07 rsquo08 rsquo10

62790(08)

62290(56)

54630(66)51260

(82)

58990(80)

Reserve margin

As of Dec 2010 71308(68)

Peak demand(Growth rate)

122 113

105

72 91

62

66800(64)

79

rsquo09

7

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power SystemElectricity MarketIIII

Key Features Market Operations - Procedures- Biddings- Load Forecasting- Generation Scheduling - Metering- Settlement

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Mandatory Poolbull All generators(ge 1 MW) and retailers should trade(buy and sell) electric power through the market All market participants should register as the KPX member

bull The market players are GENCOs(sellers) and KEPCO(the single buyer)

Generator Bidding Poolbull Only the supply(generation) side bid into the pool with their generator availabilities for each trading day

bull The buyer does not bid and the purchaser KEPCO acts as a price taker in the market KPX forecasts the hourly electricity demand for the trading day

bull The market clearing is processed hourly base prices and volumes are fixed day-ahead for 24 hours of the following day

9

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Cost Based Pool (CBP)bull The cost (not the price) of each generator is bid into the poolndash The generation cost is determined monthly by the Generation Cost Evaluation Committee(GCEC) based on the fuel prices in the previous month

ndash As mentioned before the generators bid only their availabilitybull The System Marginal Price(SMP) is determined in the process of Price Setting Scheduling ndash SMP reflects actual production costs of generators(start-up no-load incremental cost)

bull The Capacity Payment(CP) is paid by for the availability declared(MW) ndash CP is paid to all generators(the Centrally Dispatching Units(ge 20 MW)) who submit offer data whether or not dispatched

ndash CP is determined at every year and it is adjusted considering the level of reserve margin which can be the signal of investments

CONCOFF Payment are payed for the differences between the scheduled and the actual generations

10

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Marginal Loss Factor(MLF) for the transmission loss introduced( rsquo07)

- To minimize the long-term social cost by the incentives to generation investment in heavy load center (Generation+Transmission)

- To operate optimally the resources in the short-term by considering the locational value of generations The transmission losses are considered

- MLFs are applied to generator nodes Application to the load nodes is not necessary because the KEPCO is the single buyer

- As the stranded costs were incurred a relaxation factor was introduced to prevent the abrupt change of generator revenues(10 increase in each year)

Definition of MLF

-

11

Change of generation at the reference bus MLF = ------------------------------------------------------- Change of load at a specific bus = 1 + Loss Load increment where Loss change of total loss in the network Load increment incremental load at a certain bus

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Types of of Ancillary Services 1) Frequency Control GFAGC 2) Generation Reserves Operational reserves provided by fast start generators

3) Black Starts 1 or 2 Self start-up generators per region

4) Voltage Regulation Service Obligation of reactive power supply

Ancillary Services PaymentsbullCompensation for ancillary services is paid according to their contributions ie GFAGC service performances are assessd by the performance index

bullCo-optimization between energy and ancillary is possible bullThe economic dispatch principle (merit order) is fully met ie the roles of each types of the generator is fulfilled according to their functions

ie the Base load(Coal) Max energy output the Peaker(LNG) Effective load following by providing AGC service

12

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

The reference capacity payment(RCP) is adjusted according to the forecasted capacity margin by regions (metropolitanotherJeju island) when it is beyond a reasonable value ie12

The seasonalhourly coefficients are applied to RCP to ensure the sufficient generation capacity in peak times

All the offered capabilities of the centrally dispatched generators(over 20 MW) are compensated by hourly based RCP regardless of their actual operations

13

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 14

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 15

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Daily Biddingbull Contentsndash Hourly availabilityndash Technical characteristics

bull Bidding timendash Closing time AM 1000 trading-day ahead(D-1)ndash Term 34 hours (1900 D-1 ~ 0400 D+1) Default Data is used if generators donrsquot submit their data due to communication failures or human errors

Re-Offersbull Starting Time 1001 AM before the trading daybull Closure Time l (one) hour before the trading hour ldquoRe-offerrdquo is allowed only when the generator has faults and it cannot meet the declared availability

16

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Real-timeReal-time DispatchDispatch

(D-0)(D-0)

A Day-ahead A Day-ahead MMarketarket( D-1 )( D-1 )

Daily bidamp offermade by standing bid procedure

5 am 10am

Daily bid SubmissionGate Closure

16pm

Pumping bidGate Closure

15pm

SMPDisclosur

e

Trading hour

20pm

18pm

System Operation ScheduleDisclosure

19pm

Bid change Closure1 hour before trading hour faults outages

17

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 18

P(MW)P(MW)

CCii ($hour)($hour)

No-load -

Cost

Generation Cost [WonkWh] = Heat rate [kcalkWh] Fuel cost [Wonkcal]

- Gencos submit monthly the fuel cost data to the Committee

- Fuel consumption rates are measured at 25 50 75 100 of the gen output level during the performance test

Cost curve Determine the efficiency coefficients(abc)

Cost(CCost(Cii) = ) = (aP(aP22 + bP + c + bP + c) x Fuel ) x Fuel CostCost $hour Gcalhour $hour Gcalhour $Gcal$Gcal

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Forecasting toolbull Load forecasting system (LOFY)

Application bull For the fairness and transparency of the market pricing the output of LOFY is used without any adjustments or modifications

bull However for the operational generation schedule specific knowledge experiencesjudgement of the engineer who is in charge is added

Using databasebull Weather forecasting data (Korea Meteorological Administration)

bull Historical load data (using similar day pattern data)

LOFY was developed by the KEPRI(Korea Electric Power Research Institute) and updated their historical data base every year 19

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Generation Scheduling Program

Delivered by ALSTOM-ESCA (now ALSTOM-Grid) 1999bullin 2010 changed into New RSC with MIP(Mixed Integer Program) solution

Major Functions bull Market-based scheduling and day-ahead dispatch scheduling

bull The price setting is made by the unconstrained schedule and the generator dispatch planning by the constrained schedule

20

RSC( Resource Scheduling and Commitment) determines the generator startstop operations and also the generation outputs which can minimize the total generation cost while balancing supply and demand

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedulingbull The cost data bidding data and forecasted load data are input for generation scheduling

bull Least cost generation scheduling reflects only the technical characteristics of generators

bull When the scheduling is finished the hourly SMPrsquos are published at 300 PM

System Operational Schedulingbull The forecasted load data can be adjusted for the system operational scheduling

bull All the system constraints such as the reserve margin transmission limits fuel restrictions co-generation for district heat supply are reflected in the scheduling

bull The scheduling result(startsstops dispatch targets) are notified to Gencos before 600 PM to prepare their operations 21

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Price Setting Schedule System Operational Schedule

Features

To produce the hourly SMP in the market

To produce the actual operational schedule in consideration of various constraints of the power system

InputData

bull Hourly forecasted load (34 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating units

bull Hourly forecasted load (24 hrs)bull Generation cost curvebull Generator availabilitybull Technical characteristics of the generating unitsbull Transmission constraintsbull Reserve constraintsbull Heat supply and fuel constraintsbull Hydro and pump storage constraints

Objective Function Total Generation Cost Minimization

Disclosure Time

bull Published at 1500 (D ndash 1)

bull Published at 1800 (D ndash 1)

22

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 23

Gen 1 (30W)Gen 2 (31W)Gen 3 (32W)Gen 4 (33W)Gen 5 (34W)Gen 6 (40W)Gen 7 (41W)Gen 8 (42W)Gen 9 (43W)

Gen 11 (80W)Gen 12 (81W)Gen 13 (82W)

Gen 14 (150W)Gen 15 (200W)

ltTotal Capgt

biding

Gen 10 (44W)

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

Gen 1 (30 )Gen 2 (31 )Gen 3 (32 )Gen 4 (33 )Gen 5 (34 )Gen 6 (40 )Gen 7 (41 )Gen 8 (42 )Gen 9 (43 )Gen 11 (80 )Gen 12 (81 )Gen 13 (82 )

Gen 15 (200 )

4h 15h

SMP (WonkWh)

hour

Forecasted

Load

helliphelliphelliphellipltBiding Capgt

Pricing

Nuclear

Coal

LNG

EtcNew

addition(GT)

CP based onMarginalplant

SMP Based onMarginalcost

ForecastedLoad

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

How do we set the market price (SMP) (2)

(Time)

(Unit WonkWh)

(Unit10MW)

Low

High

0100 0400 0900 1200 1500 1900 2100 2400Power demand(10MW) 3730 3320 4770 5500 5690 5420 5420 4740

Market price(wonkWh) 7041 3267 13189 14221 14221 1384 14221 11865

24

Power demand

Market price

Available supply capacity

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

All kinds of constraints should be considered in the real time bull All the data should be updated based on the initial operational schedule such as the load forecasts generator availability changes(Re-Offers) heat supply and fuel constraints and hydro and pump storage operations etc

bull SCADA data is very important at this stages for the system stability analysis

bull Schedule energy (generation and dispatch-able load) regulation and operating reserves every 5 minutes to -

minimize cost balance load meet regulation and reserve requirements satisfy transmission constraints satisfy generatorload constraints

25

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Optimal dispatch by inter-connection MOS with EMSbull 5-min optimal constrained dispatch using MOS(ABB)bull Ancillary serve requirements is met by the MOS-EMS coupling bull AGC base points are given by MOS and economic participation factors as well

bull Coupled operation between the AGC operation scheme of the existing EMS and the MOS economic dispatch algorithms

Requirements of MOS-EMS Coupling①Transform the CBP cost data into the MOS bidding data(10 prices and outputs)

rarr The bidding data transformation server does this②Accuracies of the Load ForecastState Estimation are possible by the reliable

SCADA RTU performance and the network modeling techniques ③The on-line monitoring of MOS operation is required 26

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 27

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 28

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
  • Slide 11
  • Slide 12
  • Slide 13
  • Slide 14
  • Slide 15
  • Slide 16
  • Slide 17
  • Slide 18
  • Slide 19
  • Slide 20
  • Slide 21
  • Slide 22
  • Slide 23
  • Slide 24
  • Slide 25
  • Slide 26
  • Slide 27
  • Slide 28
  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Day-ahead Market

Price(SMP)

Schedule

Load Forecast

Cost Based

Bid Curve

Capacity Bid

Real Time System Operation

A S Bid

Generation

Capacity Prices

AS Prices

Energy

Scheduled

MeteredCapacity

A S

Settlements+

-

29

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
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  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

IPPs SMP is paid for trading volumesbull Giving incentives for independent power producers and inducing the invests for the base load generations

KEPCO Subsidiary Gencos RRC is applied instead of the full SMPbull Can not give all the settlement revenues due to KEPCOrsquo revenue shortfalls

bull Financial balancing among six power generation subsidiariesRRC Regulated revenue coefficients are different according to the generator typesClassification Variable Cost Fixed Cost

(WonkW-hour)

IPPS SMP746KEPCO Subsidiary

(by generator types)Variable cost+(SMP-VC)timesRRC

30

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
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  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System Recent Market Results

ⅢⅢTrends of Electricity TradingMarket Prices amp Retail Tariffs Summary of the Market Experiences

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
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  • Slide 14
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  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

Trade Volumes(Unit TWh)

Trade Payments(Unit Billion Dollar)

rsquo07 rsquo08rsquo10 rsquo07 rsquo08rsquo10

1823

28Number of Members

(Unit No)

rsquo07 rsquo08rsquo10 As of December 2010

104

302422

374392

441

Number of participants has increased due to the growth of the renewables especially the solar power (104 members in lsquo07 rArr 422 members in lsquo10)

Despite global economic recession trade volume is increasing steadilybull Trade volume is 441TWh (Average increase rate for the last 4 years 5 ≒)

bull Trade payments is $28 Billion (Average increase rate for the last 4 years 14 )

6 Gencos KEPCOrsquos subsidiaries take 917 of the total trade volume in 2010

32

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
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  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program

MarketPurchasing Pricesbull Steadily rising since the establishment of the market

bull The market price jumped in 2008 due to high increase of fuel prices

bull Market prices were maintained at high levels however the average settlement prices kept at a marginally increased level thanks to the nuclear power

Retail pricesbull Stable even with the high fuel pricesbull This is because retail tariffs are regulated by the government and KEPCOrsquos financial status are not good in recent years due to the high purchasing price

bull Cross subsidy between the tariffs according to the usages make it difficult to progress the market evolutions

lt Retail tariffs by the usages gt

lt Market PricePurchasing Price gt

($MWh)

33

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
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  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 34

Electricity market reduces the electricity production cost and maximizes the resource availabilitybull Economic dispatch is possible based on generation costbull Increasing the efficiency of OampM works of the generating facility

bull Improving the rate of using low-cost facility(nuclear coal) (Capacity factor of nuclear and coal power plants are increased after operation of

CBP market as 339p and 27p respectively)

Accomplish the efficiency of investmentbull The substitution effect of new generation because the maximum capacity of generators were increased and maintenance schedules were shortened

- About 1000MW substitution effect of new base load generator were occurred after the market opening

bull OM cost were cut down owing to the competition

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
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  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

Power PlanningPower Market

Power System

Market IssuesⅣⅣ

Cross Subsidy between CustomersDemand Response

Vesting Contract

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
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  • Slide 29
  • Slide 30
  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Copyright 2011 by KPX co Ltd All rights reserved

2011 IRAN IGMC Power System Operation Training Program 36

Vesting Contract between Gencos and KEPCO has been suggested for the existing generators which were commissioned before the market opening(Because their construction cost has been already recovered and should be paid less compared the new generations)

Cross subsidized tariffs between the electricity users results in inefficient use of the electricity in the beneficiaries bull It seems that some users waste the electricity at heating because of low electricity prices compared with other form of energy

Demand response mechanism in the market will contribute to the optimal use of the electricity in generalsbull By using the market price(if possible the real-time price) as the economic signal smart grid initiatives will have a bright future in the industry

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
  • Slide 8
  • Slide 9
  • Slide 10
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  • Slide 31
  • Slide 32
  • Slide 33
  • Slide 34
  • Slide 35
  • Slide 36
  • Slide 37

Power PlanningPower Market

Power System

THANK YOU

  • Slide 1
  • Slide 2
  • Slide 3
  • Slide 4
  • Slide 5
  • Slide 6
  • Slide 7
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