The Benefit of Coordinating Congestion Management in Germany
AbstractThe management of congestion within the German electricity transmission network has become more important during the last years. This emerging relevance is caused by the increase of renewable generation and the partial phaseout of nuclear power plants. Both developments yield a change in the transmission flow pattern and thus the need for congestion management. Currently, four German transmission system operators (TSOs) are in charge of managing congestion using curative methods, particularly re-dispatch of power plants. However, the existence of four TSOs within Germany induces the question whether coordination between them in managing national congestion would be beneficial. To address this issue, we apply a generalized Nash equilibrium model to analyze different degrees of coordination, covering the German electricity market with a detailed representation of the generation and network structure. Our results indicate that the costs of congestion management decrease in a rising degree of coordination as TSOs take into account congestion in other operators' zones. Total costs are highest in case each TSO is solely responsible for its own zone, and lowest if one integrated entity is in charge of mitigating congestion. We conclude that, in a setup with multiple TSOs, inducing coordination, for instance through a common market, has the potential of lowering the overall costs of congestion management.
Download InfoIf you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
Bibliographic InfoPaper provided by DIW Berlin, German Institute for Economic Research in its series Discussion Papers of DIW Berlin with number 1298.
Length: 27 p.
Date of creation: 2013
Date of revision:
Congestion Management; Coordination; Electricity Economics; Generalized Nash Equilibrium; Germany;
Find related papers by JEL classification:
- C61 - Mathematical and Quantitative Methods - - Mathematical Methods; Programming Models; Mathematical and Simulation Modeling - - - Optimization Techniques; Programming Models; Dynamic Analysis
- L94 - Industrial Organization - - Industry Studies: Transportation and Utilities - - - Electric Utilities
- Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
This paper has been announced in the following NEP Reports:
- NEP-ALL-2013-05-24 (All new papers)
- NEP-ENE-2013-05-24 (Energy Economics)
- NEP-EUR-2013-05-24 (Microeconomic European Issues)
- NEP-NET-2013-05-24 (Network Economics)
- NEP-REG-2013-05-24 (Regulation)
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
- Neuhoff, Karsten & Barquin, Julian & Bialek, Janusz W. & Boyd, Rodney & Dent, Chris J. & Echavarren, Francisco & Grau, Thilo & von Hirschhausen, Christian & Hobbs, Benjamin F. & Kunz, Friedrich & Nabe, 2013.
"Renewable electric energy integration: Quantifying the value of design of markets for international transmission capacity,"
Elsevier, vol. 40(C), pages 760-772.
- Karsten Neuhoff & Rodney Boyd & Thilo Grau & Julian Barquin & Francisco Echavarren & Janusz Bialek & Chris Dent & Christian von Hirschhausen & Benjamin Hobbs & Friedrich Kunz & Hannes Weigt & Christia, 2011. "Renewable Electric Energy Integration: Quantifying the Value of Design of Markets for International Transmission Capacity," Discussion Papers of DIW Berlin 1166, DIW Berlin, German Institute for Economic Research.
- Florian Leuthold & Hannes Weigt & Christian Hirschhausen, 2012. "A Large-Scale Spatial Optimization Model of the European Electricity Market," Networks and Spatial Economics, Springer, vol. 12(1), pages 75-107, March.
- Katrin Trepper & Michael Bucksteeg & Christoph Weber, 2013. "An integrated approach to model redispatch and to assess potential benefits from market splitting in Germany," EWL Working Papers 1319, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Apr 2014.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Bibliothek).
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If references are entirely missing, you can add them using this form.
If the full references list an item that is present in RePEc, but the system did not link to it, you can help with this form.
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your profile, as there may be some citations waiting for confirmation.
Please note that corrections may take a couple of weeks to filter through the various RePEc services.