Thanks for the clarification.
On Fri, May 21, 2010 at 6:08 PM, Ray Zimmerman <[email protected]> wrote: > 1) I suppose you could model each area as a single node with both a generator > and dispatchable load, with a fully connected network, but I'm not sure how > you would come up with meaningful network parameters. It sounds like you > don't particularly care about modeling the underlying physical network with > the transmission limitations it imposes, correct? If that's the case, then > using a DC OPF on such a system without line flow constraints is probably > fine. > > 2) Optimal from the point of view of maximum earnings of the area 5 market > participant (gen owner and load). Offering all available generation at > marginal cost will ensure that any power that can be generated at a profit > will be. Likewise for the load, any benefit that can be derived by consuming > electricity will be. Putting in a higher offer (for the gen) or a lower bid > (for the load) would only result in a reduced quantity being sold or bought. > This is basic auction theory in a last accepted offer/bid style of auction > (which I've been assuming). > > 3) This is clearly a bi-lateral type market, where each transaction is > between a specific buyer and a specific seller. MATPOWER's smartmarket does > not include this type of market. As I mentioned in my previous e-mail, it > only handles a single centralized market, where all transactions are between > a buyer or seller and the ISO itself, never between a specific buyer and a > specific seller. That is, all power sold by generators is bought by the ISO > and all power bought by the loads is sold to them by the ISO. So, my comments > about the optimal bid/offer strategy probably do not apply to the kind of > market you are envisioning, which, by the way, only makes sense IF you can > justify the use of a linear network model. The difficulty with real world > electricity markets is that every physical transaction affects the cost of > every other physical transaction, because of network losses and congestion. > > -- > Ray Zimmerman > Senior Research Associate > 211 Warren Hall, Cornell University, Ithaca, NY 14853 > phone: (607) 255-9645 > > > > On May 21, 2010, at 9:31 AM, Anirudh Raghavan wrote: > >> Thanks for your response. I still have a couple of doubts: >> >> 1) Can't interconnected areas be modeled as interconnected generators, >> with each area having one buy-bids-negative-generator and one >> sell-bids-generator, assuming all generators except those >> corresponding to the same area, are connected? >> >> 2) I did not quite follow what you meant by "the optimal offer from >> area 5 would be the marginal cost of generation and the optimal bid to >> buy would be the marginal benefit of consumption". To clarify, the >> areas are completely interconnected and can exchange power with each >> other, based on some non-area-specific inter-area transaction limit. >> >> 3) For a particular buy bid of the entering area, with qty Q and price >> P, this area would pay (P-P')*Q/2 to the broker and (P+P')*Q/2 to the >> seller,(assuming sell bid of P') and hence a total of PQ would be >> paid. Hence, to maximize the benefit of recording a bid earlier than >> an existing one, but minimizing the cost, which depends only on P, not >> P', shouldn't the optimal buy bid prices for the new area be some >> epsilon higher than existing buy bids(with some zero and some non-zero >> quantities) and the sell bids as some epsilon lower than existing sell >> bid prices? >> >> Thanks in advance. >> >> Anirudh >> >> On Fri, May 21, 2010 at 5:01 PM, Ray Zimmerman <[email protected]> wrote: >>> Anirudh, >>> First of all, MATPOWER's smartmarket code is based on nodal bids/offers, not >>> zonal. That is, the offers to sell are from individual generators, and the >>> bids to buy are from individual dispatchable loads. Second, it treats the >>> bids and offers as inputs to an optimization problem that an ISO/RTO would >>> run to compute the optimal dispatch and corresponding prices. It does not >>> compute any optimal bids or offers and it does not arrange bi-lateral >>> transactions between buyers and sellers. All buy/sell transactions are with >>> the ISO itself. >>> Having said that, it sounds to me like the optimal offer from area 5 would >>> be the marginal cost of generation and the optimal bid to buy would be the >>> marginal benefit of consumption, UNLESS there is some market power provided >>> by the network that isolates area 5 from competing generation and demand >>> response OR there is some non-competitive collusive behavior going on among >>> the market participants. >>> I suppose, if you have the network set up with all of your bids and offers >>> associated with specific dispatchable loads and generators, then you could >>> use some brute force approach, where you modify offer/bid prices over a >>> range for a fixed quantity, and modify offer/bid quantity over a range for a >>> fixed price in search of the point that yields maximum earnings/minimum >>> cost. >>> Regarding (2), it sounds like you may be thinking of bi-lateral >>> transactions. MATPOWER assumes everything is cleared through a central >>> market, so the only limits are physical flow limits between areas, which can >>> be handled by individual line flow limits or by using the interface limits >>> implemented in MATPOWER 4 (see toggle_iflims.m). >>> Hope this helps, >>> -- >>> Ray Zimmerman >>> Senior Research Associate >>> 211 Warren Hall, Cornell University, Ithaca, NY 14853 >>> phone: (607) 255-9645 >>> >>> >>> On May 21, 2010, at 3:43 AM, Anirudh Raghavan wrote: >>> >>> Hello >>> >>> I am new to Matpower and in need of some help with the smart_market >>> auction clearing code that comes with Matpower. My aim is the >>> following: >>> >>> 1) Given a set of buy and sell bids from 4 areas, and given >>> c0,c1,c2,Pmin,Pmax,Pdemand for a 5th area, I would like to get the >>> optimum buy/sell bids(their quantities and prices) that a 5th area >>> should bid at, to minimize its total cost of meeting its demand. >>> >>> I guess the buy bids of area 5 could be modeled as a negative >>> generator with piecewise continuous price function, with each of its >>> prices marginally above each of the existing buy bids. Similarly, the >>> sell bids could be modeled as a generator with prices marginally below >>> each of the existing sell bids. However, I do not know what quantities >>> to assign to these buy/sell bids. >>> >>> 2) Further, I would like to incorporate transaction limits between areas. >>> >>> Any help regarding 1 and 2 would be greatly appreciated. >>> >>> Many thanks, and sorry for initially posting this as a reply to the >>> battery question :p >>> >>> Anirudh >>> >>> >>> >> > > > >
