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Incentivizing Flexibility in System Operations

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Electricity Markets with Increasing Levels of Renewable Generation: Structure, Operation, Agent-based Simulation, and Emerging Designs

Part of the book series: Studies in Systems, Decision and Control ((SSDC,volume 144))

Abstract

Defining flexibility has been a challenge that a number of industry members and researchers have attempted to address in recent years. With increased variability and uncertainty of variable generation (VG), the resources on the system will have to be more flexible to adjust output, so that power output ranges, power ramp rates, and energy duration sustainability are sufficient to meet the needs of balancing supply with demand at various operational timescales. This chapter discusses whether existing market designs provide adequate incentives for resources to offer their flexibility into the market to meet the increased levels of variability and uncertainty introduced by VG in the short-term operational time frame. It presents a definition of flexibility and discusses how increased levels of VG require increased needs for flexibility on power systems. Following this introductory material, the chapter examines how existing market designs ensure that resources have the right incentives to provide increased flexibility, and then discusses a number of emerging market design elements that impact flexibility incentives.

This chapter is based on the detailed discussion of current and emerging market designs to incentivize flexibility in short-term system operations to meet the increased needs from variable generation [1, Sect. 4].

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Author information

Authors and Affiliations

  1. Electric Power Research Institute, Palo Alto, CA, 94304, USA

    Erik Ela

  2. National Renewable Energy Laboratory, Golden, CO, 80401, USA

    Michael Milligan, Aaron Bloom & Aaron Townsend

  3. Argonne National Laboratory, Argonne, IL, 60439, USA

    Audun Botterud & Todd Levin

Authors
  1. Erik Ela
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  2. Michael Milligan
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  3. Aaron Bloom
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  4. Audun Botterud
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  5. Aaron Townsend
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  6. Todd Levin
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Corresponding author

Correspondence to Erik Ela .

Editor information

Editors and Affiliations

  1. National Laboratory of Energy and Geology, Lisbon, Portugal

    Fernando Lopes

  2. University of Lisbon, Lisbon, Portugal

    Helder Coelho

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Ela, E., Milligan, M., Bloom, A., Botterud, A., Townsend, A., Levin, T. (2018). Incentivizing Flexibility in System Operations. In: Lopes, F., Coelho, H. (eds) Electricity Markets with Increasing Levels of Renewable Generation: Structure, Operation, Agent-based Simulation, and Emerging Designs. Studies in Systems, Decision and Control, vol 144. Springer, Cham. https://doi.org/10.1007/978-3-319-74263-2_5

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  • DOI: https://doi.org/10.1007/978-3-319-74263-2_5

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