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Sharing the shortfall: Algorithmic solutions for fair demand curtailment in zonal power markets

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  • Borbáth, Tamás
  • Van Hertem, Dirk

Abstract

The transition to renewable energy sources introduces volatility in supply and pricing, which increases the need for robust transmission networks and large electricity market pools. These markets, managed by multiple system operators, rely on central algorithms to balance supply and demand. In situations where supply cannot meet demand, involuntary demand curtailment becomes necessary. In zonal markets with flow-based constraints and uneven zone sizes, curtailment often disproportionately affects smaller zones. This paper evaluates alternative “adequacy patches" – rules for more equitable curtailment allocation – ranging from utilitarian to Rawlsian strategies, and assesses their impact on zonal resource adequacy, marketplace stability, and algorithmic complexity.

Suggested Citation

  • Borbáth, Tamás & Van Hertem, Dirk, 2025. "Sharing the shortfall: Algorithmic solutions for fair demand curtailment in zonal power markets," Applied Energy, Elsevier, vol. 390(C).
    • Handle: RePEc:eee:appene:v:390:y:2025:i:c:s0306261925005409
    DOI: 10.1016/j.apenergy.2025.125810
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    References listed on IDEAS

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    1. Ovaere, Marten & Heylen, Evelyn & Proost, Stef & Deconinck, Geert & Van Hertem, Dirk, 2019. "How detailed value of lost load data impact power system reliability decisions," Energy Policy, Elsevier, vol. 132(C), pages 1064-1075.
    2. Astier, Nicolas & Ovaere, Marten, 2022. "Reliability standards and generation adequacy assessments for interconnected electricity systems," Energy Policy, Elsevier, vol. 168(C).
    3. Borbáth, Tamás & Van Hertem, Dirk, 2024. "Appropriate transmission grid representation for European resource adequacy assessments," Applied Energy, Elsevier, vol. 355(C).
    4. Heylen, Evelyn & Deconinck, Geert & Van Hertem, Dirk, 2018. "Review and classification of reliability indicators for power systems with a high share of renewable energy sources," Renewable and Sustainable Energy Reviews, Elsevier, vol. 97(C), pages 554-568.
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