OS1 - Comparative Simulation of Energy Market Designs

Florian Maurer

Juni 23, 2022

Outline

Background/Motivation
Research Question
Existing Market Simulations
Research Methodology
Project Plan

Background

Few incentives to integrate grid-serving behavior in the current German market design
Market does not reflect characteristics of the power grid
- Redispatch takes place retrospectively
- Benefit of consumers flexibility is only considered indirectly
- Integration of small electricity storage facilities is not fully sufficient
New market mechanisms needed through increase of
- Decentralized power generation
- Flexibility provided by prosumers
- Emerging technologies (BEV, H2, etc.)

Motivation

Simulation tools are needed to develop and compare market designs
- market design includes all market mechanisms
- LMP, LEM, centralized, P2P….
Currently no simulation framework for comparison of market designs exists
- Abstract description of market design
- Evaluation of different approaches

Market Design Definition

Originally central dispatch
Restriction of natural monopoly to grid operation
- Market liberalization
- Multi-level monopolies based on geographic constraints
Market design/Regulatory framework
- Pricing models
  - Cash flow
  - Incentives
- Information flow
- Power flow
- Market entry and obligations

Market Roles

Grid operator
- Transmission system operator
- Distribution system operator
Consumer/Producer/Prosumer
Other (through market design)
- Market operator
- Metering point operator
- Aggregator (electricity supplier)
- Balancing provider
- …

Fundamental Goals of a Market Design

Safety of supply
Economic efficiency
- Total welfare
- Cost reduction
Climate friendliness

Energy policy triangle — based on “1x1 der Energiewende”

Research Question

How can different energy market designs be evaluated in a simulative comparative manner?

Problem Category

Agent-based simulation of energy market mechanisms

Objective: Framework for the Comparison of Market Designs

Which abstract description is able to characterize different market designs?
Can different market mechanisms be represented in the simulation software?
Application of flexible evaluation criteria possible?

Market Comparability

Non-Functional Requirements

Availability/Open Source
Scalability
Modularity
Interoperability with existing tools

Functional Requirements

Possible grid optimization through power flow calculation
Modelling of different market mechanisms
Customizable key performance indicators for market

Presentation of existing Market Simulations

Which simulation frameworks are available
Evaluation of positioning and basic functionalities
Conversations with Steffen Wehkamp (OFFIS), Uwe Krien (Oemof), Johannes Kochems (AMIRIS/Pommes), Grid Singularity, lemlab

Grid Singularity Exchange (GSY-e)

Berlin Company [1]
Decentralization motivation
Relative grid charges
Hierarchical market simulation
No grid calculation
Simulation and real-time

Grid Fees GSY-e — Grid Singularity Dynamic Grid Fees

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
GSY-e	2016-now	LEM	✓	✓	○	✓	✓	○

lemlab

TU-Munich [2]
Simulation of local energy markets
Matching local generation and consumption
Deviation purchased at wholesale market (fixed price)
No modeling of network load

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
lemlab	2021-now	LEM	✓	◐	○	○	◐	○

Simona

TU-Dortmund [3]
Grid simulation
Evaluation of the necessary grid expansion
Analysis of power grids
No consideration of market mechanisms

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
SIMONA	2021-now	○	✓	○	✓	○	◐	○

ASAM

PhD project [4]
Various markets implemented
- IDM
- Balancing Market
- DAM
Europe based
No implemented grid functionality

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
ASAM	2021-now	DA, ID, RE	✓	○	◐	○	○	○

AMIRIS

DLR, 2022 [5]
Agent-based modeling
DAM only
No grid calculation

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
AMIRIS	2016-now	DA	✓	◐	○	◐	○	○

USEF

Novel market design [6]
Developed in 2016
Integration of flexibility
- Aggregators
- Balancing Responsible Party

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
USEF	2016-2017	USEF	✓	○	◐	○	○	○

FNCS

Simulation through interacting software [7]
According to own documentation complex and “confusing”
Numerous different programs necessary
GridLab-D allows network simulation with Excel

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
FNCS/AMES	2008-now	SCUC/SCED	✓	◐	◐	✓	◐	○

PowerACE

ReFlex project [8]
Not available
Investment calculation
Day-Ahead Market

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
PowerACE	2013-2016	DA	○	○	○	○	○	○

Maon [9]
- Proprietary application of the IAEW
ÖkoFlex [10]
- Discontinued research project
PowerMatcher
- Discontinued
AMES/PSST
- ERCOT Test System
- Central Dispatch (SCUC/SCED)
- Freely available

Comparison Agent-based Market Simulation

Model	Year	Market Design	OSS	Scaled	Power Flow	Modularity	Interoperability	Market Comparison
GSY-e	2016-now	LEM	✓	✓	○	✓	✓	○
lemlab	2021-now	LEM	✓	◐	○	○	◐	○
SIMONA	2021-now	○	✓	○	✓	○	◐	○
ASAM	2021-now	DA, ID, RE	✓	○	◐	○	○	○
AMIRIS	2016-now	DA	✓	◐	○	◐	○	○
USEF	2016-2017	USEF	✓	○	◐	○	○	○
FNCS/AMES	2008-now	SCUC/SCED	✓	◐	◐	✓	◐	○
Powermatcher	2014-2017	○	◐	✓	○	○	◐	○
PowerACE	2013-2016	DA	○	○	○	○	○	○
Maon	2012-2021	DA	○	○	✓	○	○	○
ÖkoFlex	2014-2017	DA	○	○	◐	○	○	○

○ - not applicable, ◐ - partly applicable, ✓ - fully applicable

Project plan - What’s next?

Further evaluation of GSY-e
- Detailed analysis of market mechanisms
- Implementation of first scenarios
- Adding Power Flow calculation
Design of an abstract market description
Inspiration of existing and future market mechanisms

Research Methodology

Design science [11]
Benchmarking

Narrowing the Simulation Goal

Capability of comparison instead of comparing
- No claim of correct parameterization
- No focus on agent behavior (best trading strategy).
Qualitative assessment on few benchmarks

Use in project

PhD of Rebeca Ramirez → KPI for markets
Integration as market module into MOSAIK
European BC4P Project
- 10.2021-10.2024 Employed at FH Aachen
- Expanding market opportunities for blockchain and the energy transition for SMEs in the Euregio.
- Developing a secure innovative energy market using renewable energy.
Further development necessary

Thank you for your Attention!

Questions?

References

[1]

GridSingularity, “Grid Singularity Mission - Grid Singularity Wiki,” 2021. [Online]. Available: https://gridsingularity.github.io/gsy-e/documentation/. [Accessed: 15-Apr-2022].

[2]

M. Zade, S. D. Lumpp, P. Tzscheutschler, and U. Wagner, “Satisfying user preferences in community-based local energy markets — Auction-based clearing approaches,” Applied Energy, vol. 306, p. 118004, Jan. 2022.

[3]

J. Hiry, C. Kittl, F. Erlemeyer, and D. Schmid, “SIMONA – Agentenbasierte Netzsimulation für das intelligente Verteilnetz der Zukunft,” vol. Jahresbericht, pp. 40–41, Jan. 2018.

[4]

S. Glismann, “Ancillary Services Acquisition Model: Considering market interactions in policy design,” Renewable and Sustainable Energy Reviews, Apr. 2021.

[5]

J. Kochems and C. Schimeczek, “Agentenbasierte Modellierung von Lastmanagement im deutschen Stromsektor,” in Internationale Energiewirtschaftstagung (IEWT) 2021: Das Energiesystem nach Corona: Irreversible Strukturänderungen - Wie?, 2021.

[6]

USEF Design Team, “USEF - The Framework Explained,” p. 58, May 2021.

[7]

S. Battula, L. Tesfatsion, and T. E. McDermott, “An ERCOT test system for market design studies,” Applied Energy, vol. 275, p. 115182, Oct. 2020.

[8]

“Model PowerACE – REflex.” [Online]. Available: https://reflex-project.eu/model-coupling/powerace/. [Accessed: 10-Dec-2021].

[9]

M. Ketov, “MARKTSIMULATIONEN UNTER BERÜCKSICHTIGUNG DER STROM-WÄRME-SEKTORENKOPPLUNG,” p. 5, 2019.

[10]

T. Künzel and A. Weidlich, “Flexibility as an economic commodity in the intelligent energy system for the efficient integration of renewable energies,” 2015.

[11]

K. Peffers, T. Tuunanen, M. A. Rothenberger, and S. Chatterjee, “A Design Science Research Methodology for Information Systems Research,” Journal of Management Information Systems, vol. 24, no. 3, pp. 45–77, Dec. 2007.