Long-term cross-border electricity trading model under the background of Global Energy Interconnection

• Main Authors: Fu Chen, Kun Huang, Yunting Hou, Tao Ding
• Format: Article
• Language: English
• Published: KeAi Communications Co., Ltd. 2019-04-01
• Series: Global Energy Interconnection
• Online Access: http://www.sciencedirect.com/science/article/pii/S2096511719300350

Environmental problems caused by traditional power production and the unbalanced distribution of energy resources and demand limit the development of sustainable societies. A feasible method to optimize the resource allocation has been proposed, and it involves cross-border and cross-regional electricity transactions. However, the uncertainty of renewable energy and the specific features of the cross-border electricity market are key issues which need to be considered in the trading mechanism design. Based on this, this paper sets up a long-term cross-border electricity trading model considering the uncertainty of renewable energy. First, annual transactions are matched according to the declared data of bidders with consideration of cross-border interconnection development benefits, potential benefit risks, and transmission costs. Second, for annual contract decomposition, the model uses the minimum generation cost function with a penalty item for power shortages to allocate electricity to each month. Additionally, the scenario reduction algorithm is combined with the unit commitment to construct a stochastic generation plan. Finally, a case study of the numerical results for the multinational electricity market in northeast Asia is used to show that the proposed trading model is feasible for cross-border electricity trading with high penetration of renewable energy. Keywords: Global energy interconnection, Pumped storage, Uncertainty, Scenario reduction, Stochastic programming