Short-term strategies for Dutch wind power producers to reduce imbalance costs

The paper assesses bidding strategies for a wind power producer in the Netherlands. To this end, a three-stage stochastic optimization framework is used, maximizing wind power producer's profit using the day-ahead and cross-border intraday market, taking into account available interconnection c...

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Bibliographic Details
Published in:Energy policy 2013-01, Vol.52, p.573-582
Main Authors: Chaves-Ávila, José Pablo, Hakvoort, Rudi A., Ramos, Andrés
Format: Article
Language:English
Subjects:
Applied sciences
Bidding strategies
Commodity prices
Cost
Economic data
Electric energy
Energy
Energy economics
Energy market
Energy policy
Energy prices
Exact sciences and technology
General, economic and professional studies
Market theory
Markets
Natural energy
Netherlands
Optimization techniques
Power generation
Power marketers
Price uncertainty
Prices
Profitability
Profits
profits and margins
Stochastic programming
Studies
Wind energy
Wind power
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Summary:The paper assesses bidding strategies for a wind power producer in the Netherlands. To this end, a three-stage stochastic optimization framework is used, maximizing wind power producer's profit using the day-ahead and cross-border intraday market, taking into account available interconnection capacity. Results show that the wind power producer can increase its profits by trading on the intraday market and – under certain imbalance prices – by intentionally creating imbalances. It has been considered uncertainties about prices, power forecast and interconnection capacity at the day-ahead and intraday timeframes. ► A cross-border bidding strategy model for wind power producers has been developed. ► The model was applied to a real case study of a Dutch offshore wind power producer. ► Under certain imbalance prices, it is not profitable to deliver all possible power. ► Intraday markets give the possibility to reduce imbalance costs. ► Integration of intraday markets will increase liquidity.
ISSN:0301-4215
1873-6777
DOI:10.1016/j.enpol.2012.10.011