Modeling the Uncertainties Involved in Net Transmission Capacity Calculation

by Perninge, Magnus

In a deregulated electricity market with area-pricing it is often desirable to be able to transfer as much electric power as possible between the areas, since this is the most cost efficient way to use the power grid. However, due to limitations in the system there is a maximal amount of power that is possible to transfer between the areas of the system, this limit is called the total transfer capacity (TTC). When the transmission system operator (TSO) is setting the trading limits between the different areas of a multi-area power system he cannot, however, consider only the TTC but also has to consider the uncertainties in the system. The aim of this project is to find good methods for estimating the risk of violating the TTC when keeping a certain margin on the transfers in the system. To do this one will have to decide which uncertainties are important to consider since a truly accurate calculation is not possible to perform in normal power systems. The method used to attack the problem of evaluating the risk of violating the TTC will be Monte Carlo Simulation. To perform such a simulation we need to find the probability distribution of the demand, the production and the state of the grid. Finding the distributions of the demand and the production will be the major concern of this thesis. The demand will be modeled as the sum of a deterministic curve representing the mean and the solution to a stochastic differential equation (SDE). This is a method commonly used at for example the weather derivatives market to model the outside temperature. Since outside temperature and electric power consumption are closely related this seems like a valid model. The production will be modeled as the sum of the planned production minus outages in production, the primary control and the secondary control. It is though not trivial to find an adequate model for the secondary control. Two different models for the secondary control were tested and showed different results for the risk of violating the TTC and thus for the appropriate margin to be kept.