International Gas Union Research Conference - IGRC 2014, Copenhagen (Denmark). 17-19 September 2014
Summary:
During the last two decades, the installation of natural gas fired power plants (NGFPPs) has increased mainly due to their low capital costs compared to other generation technologies, their high conversion efficiencies, their lower CO2 emissions, and their flexibility, which makes them well suited to provide generation in power systems with high penetration of renewable technologies. This growth of power generation based on natural gas fired power plants (NGFPPs) has lead to increasing interactions between electricity and natural gas industries, and more companies are progressively and simultaneously participating as big players in both markets. However, electricity and natural gas systems have traditionally been analyzed separately, and each company was settled in only one of the both industries. In any case, both types of companies usually support their decision-making process in market models (electricity and/or gas market models). Therefore, an energy company with a position in both markets usually has two large optimization models, (one for each system), and the communication between both models would allow companies to obtain synergies, resulting in a competitive advantage over other companies that operate uncoordinatedly in both markets. The objective of this research is to analyze economic interactions that may arise in the medium term when a company operates in both systems. Different methods to integrate/communicate two independent optimization models (one for each system) will be discussed, as well as the possible strategic behavior of such agents operating in both markets.
Publication date: 2014-09-17.
Citation:
M. Gil, P. Dueñas, J. Reneses, Electricity and natural gas interdependency: coupling large market models, International Gas Union Research Conference - IGRC 2014, Copenhagen (Denmark). 17-19 September 2014.
