IDEAS home Printed from https://ideas.repec.org/p/hhs/nhhfms/2018_014.html
   My bibliography  Save this paper

Flow-Based Market Coupling in the European Electricity Market – A Comparison of Efficiency and Feasibility

Author

Listed:
  • Bjørndal, Endre

    (Dept. of Business and Management Science, Norwegian School of Economics)

  • Mette, Bjørndal

    (Dept. of Business and Management Science, Norwegian School of Economics)

  • Cai, Hong

    (Dept. of Business and Management Science, Norwegian School of Economics)

Abstract

In May 2015, the Flow-Based Market Coupling (FBMC) model replaced the Available Transfer Capacity (ATC) model in Central Western Europe to determine the power transfers between countries or price areas. The FBMC model aims to enhance market integration and to better monitor the physical power flows. The FBMC model is expected to lead to increased social welfare in the day-ahead market and more frequent price convergence between different market areas. This paper gives a discussion of the procedures of market clearing and a mathematical formulation of the FBMC model. Moreover, we discuss the relationships between the nodal pricing, ATC, and FBMC models. In addition to an illustrative 3-node example, we examine the FBMC model in two test systems and show the difficulties in implementing the model in practice. We find that a higher social surplus in the day-ahead market may come at the cost of more re-dispatching in real time. We also find that the FBMC model might fail to relieve network congestion and better utilize the power resources, even when compared to the ATC model.

Suggested Citation

  • Bjørndal, Endre & Mette, Bjørndal & Cai, Hong, 2018. "Flow-Based Market Coupling in the European Electricity Market – A Comparison of Efficiency and Feasibility," Discussion Papers 2018/14, Norwegian School of Economics, Department of Business and Management Science.
    • Handle: RePEc:hhs:nhhfms:2018_014
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/11250/2569298
    File Function: Full text
    Download Restriction: no
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Rafael Finck, 2021. "Impact of Flow Based Market Coupling on the European Electricity Markets," NachhaltigkeitsManagementForum | Sustainability Management Forum, Springer, vol. 29(2), pages 173-186, June.

    More about this item

    Keywords

    OR in Energy; European power market; Flow-based model; ATC model; Day-ahead market;
    All these keywords.

    JEL classification:

    • Q00 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - General

    NEP fields

    This paper has been announced in the following NEP Reports:

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:hhs:nhhfms:2018_014. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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 RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Stein Fossen (email available below). General contact details of provider: https://edirc.repec.org/data/dfnhhno.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.