IDEAS home Printed from https://ideas.repec.org/a/eee/renene/v187y2022icp743-759.html
   My bibliography  Save this article

Impacts, challenges and suggestions of the electricity market for hydro-dominated power systems in China

Author

Listed:
  • Shen, Jian-jian
  • Cheng, Chun-tian
  • Jia, Ze-bin
  • Zhang, Yang
  • Lv, Quan
  • Cai, Hua-xiang
  • Wang, Bang-can
  • Xie, Meng-fei

Abstract

Promoting a hydro-dominated electricity market (HEM) is greatly challenging. This study analyzes impacts and challenges of electricity market on hydro-dominated power system operations. The analysis indicates that the HEM exhibits unique difficulties including spatiotemporal hydraulic coupling of cascaded hydropower plants, runoff uncertainties, nonlinear operation constraints, coordination of multiple time scales, as well as transprovincial and transregional power transmission. Two kinds of suggestions are presented to overcome these difficulties for different market objects. The hydropower enterprises are suggested to improve generation prediction level, reconstruct market-based operation rules, implement multiscale nested operations and bidding, strengthen collaborative bidding of different stakeholders, and analyze market demands and competitors. The goal is to improve their competitiveness. The market operators should make efforts to develop accuracy and efficiency of clearing models and predetermine feasible hydropower bidding intervals to ensure power balance and prevent unreasonable spillage. Moreover, a practical and convenient electricity trading platforms is required. It is implied that there is strong necessity to explore characteristic market theories and application technologies combined with hydropower characteristics and actual dispatching needs.

Suggested Citation

  • Shen, Jian-jian & Cheng, Chun-tian & Jia, Ze-bin & Zhang, Yang & Lv, Quan & Cai, Hua-xiang & Wang, Bang-can & Xie, Meng-fei, 2022. "Impacts, challenges and suggestions of the electricity market for hydro-dominated power systems in China," Renewable Energy, Elsevier, vol. 187(C), pages 743-759.
    • Handle: RePEc:eee:renene:v:187:y:2022:i:c:p:743-759
    DOI: 10.1016/j.renene.2022.01.089
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0960148122000994
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.renene.2022.01.089?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Liu, Benxi & Liao, Shengli & Cheng, Chuntian & Chen, Fu & Li, Weidong, 2018. "Hydropower curtailment in Yunnan Province, southwestern China: Constraint analysis and suggestions," Renewable Energy, Elsevier, vol. 121(C), pages 700-711.
    2. Edmar Luiz Fagundes De Almeida & Helder Queiroz Pinto Jr., 2005. "Reform in Brazilian electricity industry: the search for a new model," International Journal of Global Energy Issues, Inderscience Enterprises Ltd, vol. 23(2/3), pages 169-187.
    3. Nils Löhndorf & David Wozabal & Stefan Minner, 2013. "Optimizing Trading Decisions for Hydro Storage Systems Using Approximate Dual Dynamic Programming," Operations Research, INFORMS, vol. 61(4), pages 810-823, August.
    4. Xin-gang, Zhao & Pei-ling, Li & Ying, Zhou, 2020. "Which policy can promote renewable energy to achieve grid parity? Feed-in tariff vs. renewable portfolio standards," Renewable Energy, Elsevier, vol. 162(C), pages 322-333.
    5. Ludovic Gaudard & Jeannette Gabbi & Andreas Bauder & Franco Romerio, 2016. "Long-term Uncertainty of Hydropower Revenue Due to Climate Change and Electricity Prices," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(4), pages 1325-1343, March.
    6. Fang, Debin & Zhao, Chaoyang & Yu, Qian, 2018. "Government regulation of renewable energy generation and transmission in China’s electricity market," Renewable and Sustainable Energy Reviews, Elsevier, vol. 93(C), pages 775-793.
    7. Hu, Junfeng & Yan, Qingyou & Kahrl, Fredrich & Liu, Xu & Wang, Peng & Lin, Jiang, 2021. "Evaluating the ancillary services market for large-scale renewable energy integration in China's northeastern power grid," Utilities Policy, Elsevier, vol. 69(C).
    8. Ayman Alhejji & Alban Kuriqi & Jakub Jurasz & Farag K. Abo-Elyousr, 2021. "Energy Harvesting and Water Saving in Arid Regions via Solar PV Accommodation in Irrigation Canals," Energies, MDPI, vol. 14(9), pages 1-24, May.
    9. Motamedi Sedeh, Omid & Ostadi, Bakhtiar, 2020. "Optimization of bidding strategy in the day-ahead market by consideration of seasonality trend of the market spot price," Energy Policy, Elsevier, vol. 145(C).
    10. Rosso, M. & Bottero, M. & Pomarico, S. & La Ferlita, S. & Comino, E., 2014. "Integrating multicriteria evaluation and stakeholders analysis for assessing hydropower projects," Energy Policy, Elsevier, vol. 67(C), pages 870-881.
    11. Ludovic Gaudard & Jeannette Gabbi & Andreas Bauder & Franco Romerio, 2016. "Long-term Uncertainty of Hydropower Revenue Due to Climate Change and Electricity Prices," Water Resources Management: An International Journal, Published for the European Water Resources Association (EWRA), Springer;European Water Resources Association (EWRA), vol. 30(4), pages 1325-1343, March.
    12. Yang Yang & Minglei Bao & Yi Ding & Yonghua Song & Zhenzhi Lin & Changzheng Shao, 2018. "Review of Information Disclosure in Different Electricity Markets," Energies, MDPI, vol. 11(12), pages 1-20, December.
    13. Yu, Nanpeng & Tesfatsion, Leigh & Liu, Chen-Ching, 2012. "Financial Bilateral Contract Negotiation in Wholesale Electricity Markets Using Nash Bargaining Theory," ISU General Staff Papers 201201010800001470, Iowa State University, Department of Economics.
    14. Lin, Boqiang & Du, Kerui, 2015. "Energy and CO2 emissions performance in China's regional economies: Do market-oriented reforms matter?," Energy Policy, Elsevier, vol. 78(C), pages 113-124.
    15. Ventosa, Mariano & Baillo, Alvaro & Ramos, Andres & Rivier, Michel, 2005. "Electricity market modeling trends," Energy Policy, Elsevier, vol. 33(7), pages 897-913, May.
    16. Cheng, Chuntian & Chen, Fu & Li, Gang & Ristić, Bora & Mirchi, Ali & Qiyu, Tu & Madani, Kaveh, 2018. "Reform and renewables in China: The architecture of Yunnan's hydropower dominated electricity market," Renewable and Sustainable Energy Reviews, Elsevier, vol. 94(C), pages 682-693.
    17. Liu, Shuangquan & Xie, Mengfei, 2020. "Modeling the daily generation schedules in under-developed electricity markets with high-share renewables: A case study of Yunnan in China," Energy, Elsevier, vol. 201(C).
    18. Shen, Jianjian & Cheng, Chuntian & Cheng, Xiong & Lund, Jay R., 2016. "Coordinated operations of large-scale UHVDC hydropower and conventional hydro energies about regional power grid," Energy, Elsevier, vol. 95(C), pages 433-446.
    19. Shen, Jianjian & Cheng, Chuntian & Wang, Sen & Yuan, Xiaoye & Sun, Lifei & Zhang, Jun, 2020. "Multiobjective optimal operations for an interprovincial hydropower system considering peak-shaving demands," Renewable and Sustainable Energy Reviews, Elsevier, vol. 120(C).
    20. Zhang, Yi & Cheng, Chuntian & Cao, Rui & Li, Gang & Shen, Jianjian & Wu, Xinyu, 2021. "Multivariate probabilistic forecasting and its performance’s impacts on long-term dispatch of hydro-wind hybrid systems," Applied Energy, Elsevier, vol. 283(C).
    21. Wu, Wenqing & Ma, Xin & Zeng, Bo & Wang, Yong & Cai, Wei, 2019. "Forecasting short-term renewable energy consumption of China using a novel fractional nonlinear grey Bernoulli model," Renewable Energy, Elsevier, vol. 140(C), pages 70-87.
    22. Kuriqi, Alban & Pinheiro, António N. & Sordo-Ward, Alvaro & Bejarano, María D. & Garrote, Luis, 2021. "Ecological impacts of run-of-river hydropower plants—Current status and future prospects on the brink of energy transition," Renewable and Sustainable Energy Reviews, Elsevier, vol. 142(C).
    23. Liu, Shuangquan & Yang, Qiang & Cai, Huaxiang & Yan, Minghui & Zhang, Maolin & Wu, Dianning & Xie, Mengfei, 2019. "Market reform of Yunnan electricity in southwestern China: Practice, challenges and implications," Renewable and Sustainable Energy Reviews, Elsevier, vol. 113(C), pages 1-1.
    Full references (including those not matched with items on IDEAS)

    Citations

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


    Cited by:

    1. Feng Liu & Yihang Wei & Yu Du & Tao Lv, 2022. "Mechanism and Influencing Factors of Low-Carbon Coal Power Transition under China’s Carbon Trading Scheme: An Evolutionary Game Analysis," IJERPH, MDPI, vol. 20(1), pages 1-15, December.
    2. Yu, Liying & Wang, Peng & Chen, Zhe & Li, Dewen & Li, Ning & Cherkaoui, Rachid, 2023. "Finding Nash equilibrium based on reinforcement learning for bidding strategy and distributed algorithm for ISO in imperfect electricity market," Applied Energy, Elsevier, vol. 350(C).
    3. Luca Lena Jansen & Georg Thomaßen & Georgios Antonopoulos & Ľuboš Buzna, 2022. "An Efficient Framework to Estimate the State of Charge Profiles of Hydro Units for Large-Scale Zonal and Nodal Pricing Models," Energies, MDPI, vol. 15(12), pages 1-23, June.
    4. Fatras, Nicolas & Ma, Zheng & Duan, Hongbo & Jørgensen, Bo Nørregaard, 2022. "A systematic review of electricity market liberalisation and its alignment with industrial consumer participation: A comparison between the Nordics and China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 167(C).
    5. Zou, Yidong & Hu, Wenqing & Xiao, Zhihuai & Wang, Yunhe & Chen, Jinbao & Zheng, Yang & Qian, Jing & Zeng, Yun, 2023. "Design of intelligent nonlinear robust controller for hydro-turbine governing system based on state-dynamic-measurement hybrid feedback linearization method," Renewable Energy, Elsevier, vol. 204(C), pages 635-651.
    6. Rujie Zhu & Kaushik Das & Poul Ejnar Sørensen & Anca Daniela Hansen, 2023. "Optimal Participation of Co-Located Wind–Battery Plants in Sequential Electricity Markets," Energies, MDPI, vol. 16(15), pages 1-17, July.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Liu, Shuangquan & Yang, Qiang & Cai, Huaxiang & Yan, Minghui & Zhang, Maolin & Wu, Dianning & Xie, Mengfei, 2019. "Market reform of Yunnan electricity in southwestern China: Practice, challenges and implications," Renewable and Sustainable Energy Reviews, Elsevier, vol. 113(C), pages 1-1.
    2. Liu, Shuangquan & Xie, Mengfei, 2020. "Modeling the daily generation schedules in under-developed electricity markets with high-share renewables: A case study of Yunnan in China," Energy, Elsevier, vol. 201(C).
    3. Alassi, Abdulrahman & Bañales, Santiago & Ellabban, Omar & Adam, Grain & MacIver, Callum, 2019. "HVDC Transmission: Technology Review, Market Trends and Future Outlook," Renewable and Sustainable Energy Reviews, Elsevier, vol. 112(C), pages 530-554.
    4. Dzido, Aleksandra & Wołowicz, Marcin & Krawczyk, Piotr, 2022. "Transcritical carbon dioxide cycle as a way to improve the efficiency of a Liquid Air Energy Storage system," Renewable Energy, Elsevier, vol. 196(C), pages 1385-1391.
    5. Wu, Zhaoyuan & Zhou, Ming & Zhang, Ting & Li, Gengyin & Zhang, Yan & Liu, Xiaojuan, 2020. "Imbalance settlement evaluation for China's balancing market design via an agent-based model with a multiple criteria decision analysis method," Energy Policy, Elsevier, vol. 139(C).
    6. Qian, Long & Xu, Xiaolin & Sun, Ying & Zhou, Yunjie, 2022. "Carbon emission reduction effects of eco-industrial park policy in China," Energy, Elsevier, vol. 261(PB).
    7. Cook, David & Malinauskaite, Laura & Davíðsdóttir, Brynhildur & Ögmundardóttir, Helga, 2021. "Co-production processes underpinning the ecosystem services of glaciers and adaptive management in the era of climate change," Ecosystem Services, Elsevier, vol. 50(C).
    8. Zheng, Xuemei & Menezes, Flavio & Nepal, Rabindra, 2021. "In between the state and the market: An empirical assessment of the early achievements of China's 2015 electricity reform," Energy Economics, Elsevier, vol. 93(C).
    9. Tian, Xiaoge & Chen, Weiming & Hu, Jinglu, 2023. "Game-theoretic modeling of power supply chain coordination under demand variation in China: A case study of Guangdong Province," Energy, Elsevier, vol. 262(PA).
    10. Jian Zhang & Yanan Zheng & Mingtao Yao & Huiji Wang & Zhaoguang Hu, 2019. "An Agent-Based Two-Stage Trading Model for Direct Electricity Procurement of Large Consumers," Sustainability, MDPI, vol. 11(18), pages 1-16, September.
    11. Xuguang Yu & Gang Li & Chuntian Cheng & Yongjun Sun & Ran Chen, 2019. "Research and Application of Continuous Bidirectional Trading Mechanism in Yunnan Electricity Market," Energies, MDPI, vol. 12(24), pages 1-18, December.
    12. Xianliang Cheng & Suzhen Feng & Yanxuan Huang & Jinwen Wang, 2021. "A New Peak-Shaving Model Based on Mixed Integer Linear Programming with Variable Peak-Shaving Order," Energies, MDPI, vol. 14(4), pages 1-15, February.
    13. Chen, Peipei & Wu, Yi & Zou, Lele, 2019. "Distributive PV trading market in China: A design of multi-agent-based model and its forecast analysis," Energy, Elsevier, vol. 185(C), pages 423-436.
    14. Alejandro Castillo-Ramírez & Diego Mejía-Giraldo, 2021. "Measuring Financial Impacts of the Renewable Energy Based Fiscal Policy in Colombia under Electricity Price Uncertainty," Sustainability, MDPI, vol. 13(4), pages 1-28, February.
    15. Plaga, Leonie Sara & Bertsch, Valentin, 2023. "Methods for assessing climate uncertainty in energy system models — A systematic literature review," Applied Energy, Elsevier, vol. 331(C).
    16. Jiandong Chen & Chong Xu & Yinyin Wu & Zihao Li & Malin Song, 2022. "Drivers and trajectories of China’s renewable energy consumption," Annals of Operations Research, Springer, vol. 313(1), pages 441-459, June.
    17. Yang, Bo & Wu, Shaocong & Zhang, Hao & Liu, Bingqiang & Shu, Hongchun & Shan, Jieshan & Ren, Yaxing & Yao, Wei, 2022. "Wave energy converter array layout optimization: A critical and comprehensive overview," Renewable and Sustainable Energy Reviews, Elsevier, vol. 167(C).
    18. Gaudard, Ludovic & Avanzi, Francesco & De Michele, Carlo, 2018. "Seasonal aspects of the energy-water nexus: The case of a run-of-the-river hydropower plant," Applied Energy, Elsevier, vol. 210(C), pages 604-612.
    19. Zhao, Zhigao & Yang, Jiandong & Huang, Yifan & Yang, Weijia & Ma, Weichao & Hou, Liangyu & Chen, Man, 2021. "Improvement of regulation quality for hydro-dominated power system: quantifying oscillation characteristic and multi-objective optimization," Renewable Energy, Elsevier, vol. 168(C), pages 606-631.
    20. Ludovic Gaudard & Franco Romerio, 2020. "A Conceptual Framework to Classify and Manage Risk, Uncertainty and Ambiguity: An Application to Energy Policy," Energies, MDPI, vol. 13(6), pages 1-22, March.

    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:eee:renene:v:187:y:2022:i:c:p:743-759. 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.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc 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 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: Catherine Liu (email available below). General contact details of provider: http://www.journals.elsevier.com/renewable-energy .

    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.