Professional Documents
Culture Documents
PSERC
1
Mission
PSERC
PSERC Universities
PSERC
Research Program
PSERC
Fernando L. Alvarado
Professor, University of Wisconsin
Invited Presentation
43rd NARUC Program
East Lansing, Michigan, August 15, 2001
Outline
PSERC
n-1 security
Reserve margins
PSERC
End-user perspective:
PSERC
PSERC
A planning concept
Based on random outage of generators,
what is the probability that the available
generators will be insufficient to meet
the anticipated load
Measured in frequency of expected outages
PSERC
PSERC
PSERC
Cascading overloads
Voltage collapse
Insufficiency of generation
13
Reserves
PSERC
14
PSERC
More on reserves
PSERC
Reserve margins
PSERC
17
PSERC
Temporal classification
PSERC
Spinning reserves
Fast-responding, usually instantaneously
Supplemental reserves
You can bring resources on-line quickly
Backup reserves
They can be brought on line after some
time
19
10
21
Economics 101
PSERC
Price
Demand function
(value of electricity
to customers)
Consumer
surplus
Total consumer
surplus (area)
Price
Equilibrium
Quantity
11
Economics 101
Price
PSERC
Production function
(cost of electricity
to producers)
Price
Producer
surplus
Equilibrium
Total producer
surplus (area)
Quantity
Economics 102
Price
PSERC
Total consumer
surplus (area)
Price
Equilibrium
Total producer
surplus (area)
Quantity
12
Some realities
PSERC
25
A market problem
Price
PSERC
Price
No Equilibrium?
Quantity
13
A market failure
Price
PSERC
Inelastic
demand
No Equilibrium
Quantity
14
Assumptions
PSERC
No market power
Inelastic demand
29
Available supply
Quantity (power)
Demand (inelastic)
Price
Security Margin
Maximum
available
power
Clearing
price
15
Available supply
Demand (inelastic)
Price
Clearing
price
Maximum
available
power
Quantity (power)
No intersection
16
Interruptible demand
17
Outage
probability
Generator 6
Generator 5
Generator 4
Generator 3
Generator 2
Generator 1
18
Outaged
generator
Old
supply
limit
New
supply
limit
Probability
p2
Probability p1
n-1 secure
insecure
19
Generator 1A
Generator 2A
Generator 5A
Generator 6A
System A
Generator 4A
Low price
Secure
System A
Low price
n-1 secure
Generator 3A
Generator 1B
Generator 4B
Generator 5B
System B
Generator 3B
High price
n-1 insecure
High price
n-1 secure
System B
Generator 2B
20
Flow
System A
System B
Low price
n-1 secure
Low price
n-1 secure
21
System A
Max
flow
Flow
System B
Low price
n-1 insecure
Low price
n-1 secure
Outaged
generator
Normal conditions
Max
flow
Unable
to clear
System A
Low price
n-1 secure
Max
flow
Flow
System B
Low price
n-1 secure
22
Reality
Many flowgates
Networked sysyem
Demand can be elastic
Time delays important
Generators have fixed
(investment) costs and
restrictions
Load is uncertain
PSERC
Transmission outages
exacerbate problems
If one firm dominates
a technology, market
power occurs (next)
If one firm dominates
a location, market
power results
45
PSERC
Total consumer
surplus (area)
Equilibrium
point
Equilibrium
region
Total producer
surplus (area)
Price
Congestion
level
Surplus
net loss
Quantity
23
Producer
surplus
loss
Producer
surplus
gain
Price
Congestion
level
Quantity
Price
Consumer
surplus gain
Congestion
level
Quantity
24
Price
Producer
surplus
loss
PSERC
Gain: p*C
Loss: C*p
Price
p
Congestion
level
Quantity
Gain: p*C
Loss: C*p
Price
p
Equilibrium when:
p*C = C*p, or
p/ C=p/C
Quantity
25
PSERC
Additional remarks
PSERC
26
PSERC
Observations
PSERC
54
27
$/MWh
MW
800.00
78000
Price
Maxload
600.00
70000
400.00
62000
200.00
54000
0.00
46000
-200.00
38000
-400.00
30000
-600.00
-800.00
4/97
22000
6/97
4/98
6/98
4/99
6/99
4/00
date
28
1200
1000
800
600
400
200
0
0
10
20
10
20
10
20
Offer Price
1200
1000
800
600
400
200
0
0
50
60
70
30
40
50
60
70
30
40
50
60
70
50
60
70
50
60
70
10
20
30
40
Offer Price
1200
1000
800
600
400
200
0
40
Offer Price
1200
1000
800
600
400
200
0
30
Offer Price
1200
1000
800
600
400
200
0
10
20
30
40
29
Observations
PSERC
59
Market Power?
The ability to raise
prices significantly
above the efficient
economic equilibrium
30
Demand is inelastic
All suppliers but a schedule all their cheap power
a owns P MW in n1 equal-sized generators
Supplier a generator 1
Demand
Supplier a generator 2
Other suppliers
Clearing
price
31
Surplus for
red supplier
Surplus for
blue supplier
Clearing
price
Withheld
generator
Raising prices
would require
collusion
Clearing
price
32
Probability p that
withholding will
result in surplus
Price
If demand is uncertain
P1
price 1
Quantity (power)
The expected surplus
gain is: p*(2-1)*P1
Additional observations
PSERC
66
33
Effect of granularity
Surplus is P*(2-1) for
demand above this level
34
Surplus
Effect of granularity
Demand level
Surplus with n
35
ers
10 suppli
On
lier
p
p
u
es
su
pp
lie
rs
3s
u pp
lier
s
Price
Demand
Price
Demand
36
Price
Demand
Numerical studies
PSERC
37
250
99%
200
150
95%
100
90%
50
80%
0
0
0.02
0.04
0.06
0.08
0.1
0.12
0.14
0.16
0.18
0.2
200
60%
70%
80%
90%
95%
180
160
140
120
100
80
60
40
20
0
0
10
12
14
16
18
20
38
250
200
150
60%
70%
80%
90%
95%
100
50
0
0
10
12
14
16
18
20
18
20
300
250
200
150
60%
70%
80%
90%
95%
100
50
0
0
10
12
14
16
39
400
350
300
250
200
60%
70%
80%
90%
95%
150
100
50
0
0
10
12
14
16
18
20
450
400
350
300
250
200
60%
70%
80%
90%
95%
150
100
50
0
0
10
12
14
16
18
20
40
450
400
350
60%
70%
80%
90%
95%
300
250
200
150
100
50
0
0
10
12
14
16
18
20
18
20
suppliers
15 suppliers
10 suppliers
6 suppliers
4 suppliers
3 suppliers
45
40
35
30
25
20
15
10
0
0
10
12
14
16
41
s upplie rs
15 s upplie rs
10 s upplie rs
6 s upplie rs
4 s upplie rs
3 s upplie rs
100
80
60
40
20
0
0
10
12
14
16
18
20
400
350
300
250
200
s upplie rs
15 s upplie rs
10 s upplie rs
6 s upplie rs
4 s upplie rs
3 s upplie rs
150
100
50
0
0
10
12
14
16
18
20
42
450
400
350
300
250
200
150
100
s upplie rs
50
0
0
10
12
14
15 s upplie rs
10 s upplie rs
6 s upplie rs
4 s upplie rs
3 s upplie rs
16
18
20
43
Final remarks
PSERC
Reliability
Reserves
Price spikes
44