Remuneration mechanisms for investment in reactive power flexibility

M. Troncia, J.P. Chaves, F. Pilo, T. Gómez

Sustainable Energy, Grids and Networks Vol. 27, pp. 100507-1 - 100507-13

Summary:

The practices fortheprocurement of voltage control capability need changing because of the evolution of the power system driven by the penetration of renewable sources, low carbon policies, and decentralisation. New providers have to be involved. Therefore, new mechanisms to achieve cost-effective solutions have to be encouraged. To this aim, a cost-based incentive mechanism and a weighted auction are proposed for procuring additional reactive power capacity. Both mechanisms are conceived for encouraging effective investment in voltage control by reducing the overall procurement cost. Hence, the voltage sensitivity of the reactive power provider is part of both mechanisms. Voltage sensitivity is evaluated through the Multi Infeed Interaction Factors while the American Electric Power methodology is used for identifying the reactive power costs. The proposed mechanisms are general, and they can be exploited in transmission and distribution networks irrespective of the asset, which provides the reactive capacity. A case study concerning the 39-bus New-England power system is presented for providing the proof of concept of the proposed mechanisms. The analysis of the two mechanisms’ pros and cons highlights that the weighted auction creates competition and shows low risks related to the exercise of potential market power.

Spanish layman's summary:

Este artículo propone dos mecanismos para adquirir capacidad adicional de energía reactiva, impulsando inversiones en el control de la tensión y reduciendo el coste global de la adquisición. Ambos mecanismos incluyen la evaluación de la sensibilidad de la tensión de los proveedores. Los mecanismos propuestos pueden aplicarse en las redes de transporte y distribución, independientemente del recurso que aporte el servicio de control de tensiones.

English layman's summary:

The paper proposes two mechanisms for procuring additional reactive power capacity by encouraging effective investment in voltage control and reducing the overall procurement cost. Both mechanisms include the voltage sensitivity assessment of providers. The proposed mechanisms can be exploited in transmission and distribution networks irrespective of the resource that provides the voltage support.

Keywords: Voltage support; Reactive power; Market mechanism; Flexibility

JCR Impact Factor and WoS quartile: 5,405 - Q1 (2021); 4,800 - Q1 (2023)

DOI reference: https://doi.org/10.1016/j.segan.2021.100507

Published on paper: September 2021.

Published on-line: June 2021.

Citation:
M. Troncia, J.P. Chaves, F. Pilo, T. Gómez, Remuneration mechanisms for investment in reactive power flexibility. Sustainable Energy, Grids and Networks. Vol. 27, pp. 100507-1 - 100507-13, September 2021. [Online: June 2021]