Future market structures and prices
It is challenging to forecast future prices in the power market, and this problem area could have been a Work Package or even a FME in itself. Because the size of this project is limited, we have to rely to a large extent on earlier work.
The primary goal is to utilize models, market simulations and existing literature and data to provide information about future market products, prices and structures used in revenue calculations and investment analysis.
Secondary, the objective is to develop a set of scenarios that can be used in analyses. The scenarios should consist of simultaneous market prices for day-ahead, intraday and balancing market prices and a qualitative description, giving the reason for the represented price characteristics (important drivers and requirements).
This project makes price inputs to other projects within the work package. This information will be used to focus model development and technical innovations in the correct direction and is therefore important for the overall goal which is to develop concepts, methods and prototypes that will make the utilities able to make better founded investment decisions. This is beneficial for the specific utilities and for the whole society.
Will combine modeling with scenario studies
To simulate future operation, calculate revenues and evaluate environmental consequences, stochastic price models for all the different products are needed. Stochastic modelling is typically not included in more high-level scenario studies but is important for detailed studies of individual hydro systems.
Of course, it is not known with certainty what the future products will be, but one could assume some generic type products (e.g. capacity, energy and short-term balancing) which each has different prices. SINTEF was in 2017 granted a research project, PriBas that addresses this problem from a fundamental modelling point of view. PriBas will give important input to the whole WP and this project in particular.
About the project
Full project title: Future market structures and prices
R&D Partners: SINTEF Energi, NINA and NTNU
Associated projects: IBM - Integrated Balancing Markets in Hydropower Scheduling Methods (KPN project, 2014-2018), e-Highway2050.