Reserve power marketing
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Reserve power marketing
Using reserve power pools – marketing reserve power
Distributed generation has increased enormously over the past few years, and, according to forecasts, it will continue to grow in Germany.
The proportion of renewable forms of energy is also on the rise, resulting in increasing fluctuations in the power grid. Reserve power equalizes these fluctuations in the power network – within seconds (primary control reserve), five minutes (secondary control reserve), or a quarter of an hour (minute reserve). For you, this means new commercial opportunities.
In response to the need to equalize these fluctuations, a reserve power market is evolving where reserve power is traded (positive as well as negative). On this market, auctions are frequently short-dated and trading cycles are fast: Primary control reserve (15-minute units of power units) and secondary control reserve (30-minute power units) are tendered weekly, and minute reserve every work day.
Participation in the reserve power market is highly attractive. Price fluctuations can be turned into profit, but only if you are able to act quickly and flexibly.
However, that is precisely what many generating units are unable to do. That’s why many operators still trade exclusively on the forward market. By marketing reserve power within a pool, you open up the potential for a second trading option – and can choose which option is more profitable for you at a given time.
With reserve power marketing, Siemens offers you the opportunity for new sources of income.
We help you to set up a pool of generating capacities and provide you with the technical solution plus marketing concepts, optimized for participating in the reserve power market. This means that, with the Siemens solution, you can still deliver, even within fast trading cycles – you can maximize your profits by relying on a cost-efficient and viable solution.
Your benefits at a glance:
The reserve power market is a commercially attractive one. However, providers of reserve power have to meet stringent requirements. For example, the transmission system operator requests minute reserve from the supplier via an automated procedure, and it has to be available within 15 minutes.
The minimum bid amount is five MW.
Pooling generating capacities enables providers with power units of less than five MW to participate in the reserve power market. Distributed power generating units such as biogas, cogeneration, hydropower, and small-scale combined heat and power plants are combined in a pool to create a virtual marketing unit (also often referred to as a “virtual power plant pool”). Siemens offers you a technical solution for pooling reserve power from all kinds of distributed generating units, allowing you to maximize your profit.
Operators of large generating plants profit from the Siemens pooling solution because it allows them to make more economical use of their existing capacities. In the pool, all the partners contribute to the reserve supply that needs to be kept available. This means that, overall, you have more capacity available for marketing. Pooling resources also lets you react more flexibly to market changes, and that means greater marketing flexibility.
Your benefits at a glance:
A modular solution along the entire marketing process
The Siemens solution for marketing reserve power is built around all business processes along the entire marketing chain, from pricing to delivery. The economically optimized selection of generating units and capacities, marketing, acceptance of the offer, and delivery of the service are virtually fully automated in the reserve power pool.
The solution is modular in structure so that you can choose the solution modules that fit best into your existing IT landscape. You can define your own strategies for marketing and plant deployment. The individualized pool concept can be expanded at any time. New partners can be integrated into the pool and new markets developed.
Checking availability: The power output that all generators can offer is bundled in a web portal. The plants report their availability and capacity for the defined period and submit unit rates and capacity price offers.
Optimizing the offer: All information about plant availability and capacity is incorporated in the optimization and other information is added – for example, heat, load, and weather forecasts. Deployment of the plants to cover generation needs as well as the available capacities for reserve energy are calculated.
Marketing reserve power: Bids of a minimum of 5 MW are compiled in packages and sent to the transmission system operator (TSO) via the platform regelleistung.net. If the bid is accepted, the information is automatically processed and the reserve capacity allocated to the reserve power pool is defined in accordance with the pool’s commitments to the TSO.
Fine-tuning the offer: Depending on the order awards and the delivery obligations, another optimization is run, with the goal of delivering the specified output at minimal costs. This is followed by an update procedure in which updated information on provision of the service is re-evaluated. The most economical sequence of deployment of the pool members is ascertained. Optimization is a cyclical procedure that ensures that pool operators are always prepared for a potential call-off.
Initiating dispatch: After call-off by the transmission system operator, communication takes place with the distributed generating units. Current commitments and availabilities are used for further optimization. The sequence for activating the reserve energy is now finalized. Minute reserve call-offs are fully covered in the system. Additional third-party modules such as a MeRLinTM solution (an MOLS provider client developed by the German transmission system operators) are no longer necessary.
Generating reports: Reports are created and sent to pool partners and pool operators on unit rates on the basis of data on regelleistung.net. Billing of the transmission system operator for the reserve power both called off and provided is checked regularly; pool partners are remunerated in accordance with their contribution.
Shaping the future of power generation
Würzburger Versorgungs- und Verkehrs GmbH (WVV) covers 85 percent of the electricity demand of the city of Würzburg. Falling electricity prices and the increasing pace at which small generators are added to the grid compelled WVV to respond by seeking a solution that would allow it to compete as a municipal utility and use the transformation of the power generation landscape as an opportunity. The objective was to play an active role in shaping power generation in the future. To this end, WVV wanted to adapt its marketing strategies and act more flexibly on the market with its generating units. Its plan was to occupy the “provision of reserve power” market segment as a way to open up new marketing opportunities.
In collaboration with Würzburger Versorgungs- und Verkehrs GmbH, Siemens created a pool for secondary control reserve for 130 pool partners that it will continue to develop. The generating units are combined for marketing secondary control reserve; the reserve can be shared between all generators. The modular solution covers the entire process of reserve power marketing. Trading and dispatch experts at WVV GmbH can intervene manually so that WVV retains control at all times.
Thirty percent of the installed rated output of the two combined cycle units is available as secondary control reserve. Since June 2014, small municipal utilities, power supply companies, and industrial power plants have been able to offer their distributed generating capacities along with those of the Würzburg district heating power plant (HKW). Access to the attractive reserve power market is open to all pool partners. For this reason, WVV is continuing to develop pooling with Siemens. The number of partners is increasing steadily; trade will be extended to more control areas and industrial consumers will be integrated.
The facts at a glance:
|“The Siemens solution has really convinced us in practice that we are significantly increasing the size of our pool for secondary control reserve in the Tennet transmission grid and will also trade in another control area – the Transnet BW transmission network.”|
|Armin Lewetz, CEO Heizkraftwerk Würzburg GmbH|