C2-205 ANALYSIS AND SOLUTION OF TECHNICAL CONSTRAINTS IN THE SPANISH ELECTRICITY MARKET

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1 21, rue d'artois, F Paris C2-205 Session 2004 CIGRÉ ANALYSIS AND SOLUTION OF TECHNICAL CONSTRAINTS IN THE SPANISH ELECTRICITY MARKET E. Lobato*, L. Rouco, F. M. Echavarren Universidad Pontificia Comillas M.I. Navarrete, R. Casanova Indra SSI G. López, F. Cacho, T. Domínguez Red Eléctrica de España SPAIN Summary In the Spanish electricity market, the System Operator is on charge of analysing and solving the power system constraints that arise after the market has been cleared. An optimal solution method of power system constraints in the Spanish market must take into account: (a) connection of off-line units to solve both branch overloads and voltage constraints, (b) the solution of the postulated contingencies with a preventive criteria, (c) the adjustment of voltage control resources to reduce the number of generators that need to be connected to solve voltage constraints and (d) the coupling of the solution in the 24 hourly scenarios due to the start-up cost of non-connected units. The paper overviews the management of Spanish power system constraints in the Spanish electricity market, and quantifies the energy and economic volume implied in the solution process in the first years of operation of the Spanish market. In addition, it proposes a novel approach to optimise the solution that complies with all the required features. Keywords: security assessment, congestion management, electricity markets I.- INTRODUCTION Competitive electricity markets can be organized and operated in different ways. The Spanish electricity market [1], as it started on January 1 st, 1998, is based on two separate entities: the Market Operator and the System Operator. The Market Operator receives the bidding of generation and demand for each hour of the following day and clears the market according to economic criteria. The System Operator is on charge of determining the technical feasibility of the generation dispatch provided by the Market Operator. It is also responsible for the secure operation of the power system and owns the transmission system. The solution of the power system constraints imposed by the transmission system to the generation dispatch consists of increasing and decreasing the generation of connected units, and connecting off-line ones. Therefore, if the treatment of the power system constraints is not adequate, the operation of the competitive market could be distorted. The problem of analysing and solving power system constraints in the Spanish electricity market requires technical and economic considerations. From a technical point of view the *Alberto Aguilera 23, Madrid, Spain

2 problem consists of minimizing the generation dispatch deviation so that Spanish security criteria are fulfilled. From an economic point of view the problem consists of determining the minimum system cost variation of the initial market clearing. Generating units that increase their output are remunerated at their bid price. In contrast, generating units that decrease their output are not compensated for their income reduction. Therefore, the total system cost is computed by adding the increased energy times its bid price, and subtracting the decreased energy times the system marginal price. The total cost of solving power system constraints is shared among all consumers in proportion to their demand. Spanish security criteria require that power system variables (branch power flows and bus voltages) must be within their limits not only in normal operating condition but also when any credible contingency occurs. In the Spanish electricity market, the System Operator is on charge of analysing and solving the power system constraints that arise after the market has been cleared. An optimal solution method of power system constraints in the Spanish market must take into account: (a) connection of off-line units to solve both branch overloads and voltage constraints, (b) the solution of the postulated contingencies with a preventive criteria, (c) the adjustment of voltage control resources to reduce the number of generators that need to be connected to solve voltage constraints and (d) the coupling of the solution in the 24 hourly scenarios due to the start-up cost of non-connected units. The outlined problem corresponds to a big size non-linear optimization problem that contains integer variables. The formulation of a single problem that includes all the required features for its application to a big size power system such as the Spanish power system, is not realistic due to the complexity and size of the resulting problem. This paper overviews the management of Spanish power system constraints in the Spanish electricity market, and quantifies the energy and economic volume implied in the solution process in the first five years of operation of the Spanish market. In addition, it outlines a novel approach to optimise the solution that overcomes the limitations of existing methods. The proposed method is included in ARO, a tool developed for Red Eléctrica de España, the Spanish System Operator. The tool ARO identifies the power system constraints imposed by the transmission system to the market clearing, and determines the minimum-cost redispatch of generation to solve them. A comprehensive literature review and a detailed mathematical formulation of the algorithms included in ARO has been presented by the authors in other papers [2-5]. The paper is organized as follows. Section II describes the Spanish criteria imposed for a secure operation of the power system. Section III reveals the importance of power system constraints during the first two years of the operation of the Spanish electricity market. Section IV contains the proposed approach to solve power system constraints in the Spanish electricity market. Section V illustrates the performance of the algorithm with an actual example of the Spanish electricity market. Section VI offers the conclusions of the paper. II.- SPANISH SECURITY CRITERIA FOR THE OPERATION OF THE POWER SYSTEM The security criteria of the Spanish power system [6] require that power system variables are within their limits not only in normal operating conditions but also when any credible contingency occurs. The contingencies under consideration are the loss of any single element of the power network (line, transformer, generator or shunt reactors or capacitors), the loss of the double circuits that share more than 30 km and the combined loss of certain generators and transmission lines. A power system can be operated under two security levels: (a) preventive and (b) corrective. A preventive operation requires that, for every contingency postulated, all system variables *Alberto Aguilera 23, Madrid, Spain

3 are within limits without making any action. A corrective operation requires that, if any of the contingencies postulated occurs, all variables can be brought within their limits taking appropriate control actions. Therefore, a preventive operation is more restrictive than a corrective operation. The operational procedure of the Spanish power system imposes a preventive operation of the power system. The operation of the Spanish power system is supervised by monitoring: (a) the system frequency, (b) branch power flows and (c) bus voltages. The secure system frequency value to be maintained within Europe is determined by the Union for the Co-ordination of Transmission of Electricity (UCTE) [6]. The allowed frequency band has been set to ±150 mhz. The frequency control is managed with ancillary services. In the secondary reserve market the requirements of power reserve to maintain the system frequency are published and afterwards cleared. Therefore, the system frequency is not considered as an implicit variable in the power system constraints analysis. Power system constraints can be separated into two types: (1) active power constraints and (2) reactive power constraints. Active power constraints are the branch power flows limits. Reactive power constraints correspond to bus voltages violations. Fig 1: Locations of reactive power constraints in the Spanish power network Active power constraints occur occasionally. This type of constraints is addressed by increasing and decreasing generation of connected units and in some cases, connecting offline ones. However, reactive power constraints occur very frequently in the Spanish system due to the lack of reactive power in the areas where they occur. Reactive power constraints are addressed by the connection of a set of off-line generators. The connected generators not only provide reactive power support, but also reduce the power transfers between the exporting and importing areas. This type of constraints have a local characteristic: they can only be solved by generators located in the specific areas where they occur. Fig 1 shows a map of the Spanish power network and the locations where reactive power constraints are very frequent. III.- POWER SYSTEM CONSTRAINTS IN THE SPANISH ELECTRICITY MARKET This section analyses the importance of power system constraints during the first five years of the operation of the Spanish electricity market [7,8].

4 Power system constraints in the Spanish power system have a strongly dependent seasonal characteristic. The most important power system constraints are found during the summer and the winter. Table I contains the total energy and cost incurred in the management of Spanish system constraints, and the mean price paid in the solution process, for years 1998, 1999, 2000, 2001 and Fig 2 depicts the redispatched energy and the mean price evolution during the former years. The higher incidence of the management of power system constraints took place in year 2000: the total energy redispatched in the solution of power system constraints was 3657 GWh (2.1 % of the daily market energy) and the mean price paid for this energy was 9,675 c /kwh. The total system cost reached k (6.5% of the money dealed in the daily energy market). In year 2002 the energy redispatched to solve power system constraints, and the mean price paid to it, has decreased considerably with respect to the preceding years. New CCGT plants have been connected to the grid mainly in the importing areas depicted in Fig 1 reducing the amount and severity of voltage constraints. It should be noted that the remuneration that the new connected units receive in the congestion management procedure acts as an economic signal that encourages market participants to locate new plants in energy importing areas. Table I: Comparison of the solution of power system constraints in years 1998 through 2002 YEAR Energy Energy Economic Economic Per unit cost Mean price (GWh) (%) amount (k ) amount (%) (c /kwh) (c /kwh) % % % % % % % % % % Energy redispatched (GWh) Year Mean price (c /kwh) Energy redispatched Mean price Fig 2: Evolution of energy redispatched and mean price in each year. IV. OPTIMAL SOLUTION APPROACH This section contains the proposed approach for obtaining the optimal solution of power system constraints in the Spanish electricity market. The optimal solution approach process is depicted in Fig 4.

5 HOUR 1 HOUR 24 SOLUTION OF BRANCH SOLUTION OF BRANCH OVERLOADS OVERLOADS DECOUPLED SOLUTION OF DECOUPLED SOLUTION OF VOLTAGE CONSTRAINTS VOLTAGE CONSTRAINTS COUPLED SOLUTION OF VOLTAGE CONSTRAINTS OPF OPF FEASIBILITY OPTIMALITY Fig 3. Optimal solution approach of power system constraints applied to the Spanish electricity market. It comprises two stages: feasibility and optimality. The feasibility stage obtains the generation redispatch and adjustment of the voltage control resources (generator voltages, transformer taps and state of shunt reactors and capacitors), minimizing the total system cost and complying with the Spanish security criteria. Once feasibility is obtained, an optimal power flow algorithm fine tunes the voltage control resources in order to minimize transmission losses and maximize generator reactive margins [2]. Within the feasibility stage, branch overloads and voltage constraints are addressed separately in a sequential way. At first, branch power flow limit violations are solved, in normal operating condition and in the postulated contingencies with preventive criteria. Branch overloads are addressed using a DC linear network model that approximates branch reactive power flows [3]. Some contingencies require the connection of off-line units to remove overloads. These new connected units change the reactive and active system profile and may modify the number and the severity of the contingencies that result in bus voltage violations, justifying the prior solution of branch overloads before addressing voltage constraints. Since in the Spanish case, the branch overloads that require the connection of an off-line unit can only be removed by the start up of this specific generator, in practice the solution of branch overloads is not coupled along the 24 hourly scenarios. Once branch overloads have been eliminated, bus voltages violations that arise under the occurrence of contingencies are solved with a preventive criteria. The proposed optimal solution method divides the problem in two steps: (a) decoupled solution of voltage constraints, and (b) coupled solution of voltage constraints. Initially, the decoupled solution of each hourly scenario is obtained representing the network by the complete AC power flow model [4]. The second step computes the coupled solution of voltage constraints in the 24 hourly scenarios taking as input the individual decoupled solution of each hourly scenario (active and reactive power injection of the new connected units) and the bus voltage sensitivities of violated buses with respect to active and reactive injection of non-connected units [5]. Although in theory the generation redispatch that solves voltage constraints could induce new branch overloads, in practice it does not occur because the solution of low voltages requires the injection of active and reactive power in the importing areas where there is a deficit of power. Thus, no further iteration within the feasibility stage is required.

6 V. RESULTS The performance of the proposed optimal solution approach is illustrated using an actual example of the operation of the Spanish power system. The Spanish power system model includes representation of the French, Portuguese and Moroccan systems. The size of the Spanish power system under study is: Network: 1208 buses, 1852 branches and 479 generators. Postulated contingencies: 928 branch contingencies, 64 generator contingencies, 33 double circuit contingencies and 77 combined contingencies of a generator and a transmission line. Available voltage control resources: 280 generator bus voltages, 100 transformer taps variables and 48 shunt reactors/capacitors. The decoupled solution of branch overloads and voltage violations included in the feasibility stage of Fig 3 is illustrated with peak hour 11 of the study day under consideration. Table IV contains the active and reactive load and generation distribution among the different Spanish power system areas. Areas north and northeast are exporting areas, while areas central, east and south correspond to importing areas. Therefore, voltage violations (low voltages) should be expected in areas central, east and south. Table II: Active and reactive load and generation distribution among the Spanish system areas of peak hour 11 LOAD GENERATION MW Mvar MW % Mvar % CENTRAL EAST SOUTH NORTHEAST NORTH TOTAL GENERATOR Table III: Solution of branch overloads of peak hour 11 Power variation Overload alleviation Absolute efficiency P gi (MW) A (MW) E g i g i Relative efficiency ER (%) ESCOMBRE ESCOMBRE ESCOMBRE ALDEADA ALDEADA ALDEADA AGAVANZA SAUCELL SAUCELL S.TERES S.TERES ESCOMBRE LA_MUEL CASTELL OLMEDILL OLMEDILL ELCOGAS Table V contains the generation redispatch to remove branch overloads in normal operating condition and in case of contingencies. It should be noted that the effective units ESCOMBRE1, ESCOMBRE2, ESCOMBRE3 were not cleared in the market. This fact g i

7 demonstrates that in some cases the connection of off-line units is required to solve overloads and thus, they need to be included as decision variables. Fig V illustrates the number of voltage control resources adjusted in the solution of voltage constraints for peak hour 11, for each electric area of the Spanish power system. It should be noted that the main adjustments are located in the importing areas east, central and south. Number of voltage control resources adjusted Algorithm 1 NORTHEAST NORTH EAST CENTRAL SOUTH Power system areas Generator voltages Transformer taps Shunt reactors/capacitors Fig 4: Number of voltage control resources adjusted for peak hour 11 DECOUPLED HOURLY SCENARIOS GENERATOR HOUR 11 HOUR 17 HOUR 20 LOCATION FOIX 502,0 285,0 NORTHEAST S.ADRIAN1 313,0 NORTHEAST CASTELL2 131,0 EAST LA_MUEL1 209,0 EAST GUILLEN3 70,0 SOUTH GUILLEN2 70,0 SOUTH ALGECIR2 152,0 SOUTH COUPLED HOURLY SCENARIOS GENERATOR HOUR 11 HOUR 17 HOUR 20 LOCATION CASTELL2 526,0 131,0 361,0 EAST SALLENT4 89,0 89,0 NORTHEAST SALLENT3 111,0 111,0 NORTHEAST CERCS 145,0 112,6 145,0 NORTHEAST ALGECIR2 152,0 152,0 152,0 SOUTH GUILLEN2 40,0 SOUTH GUILLEN1 40,0 SOUTH Fig 5: Decoupled and coupled solution of voltage constraints Fig 5 compares the decoupled and coupled solution of voltage constraints. Each table contains the power in MW connected in each generator. The reduction of the number of start-up decisions of thermal units in the coupled solution (the decoupled solution contains 4 start up decisions of thermal generators FOIX, S. ADRIAN, CASTELL2 and ALGECIR2, and the coupled solution contains 3 start up decisions of thermal units CASTELL2, CERCS and ALGECIR2) generator achieves a 52% system cost reduction with respect to the decoupled solution of each hourly scenario. VI.- CONCLUSIONS The System Operator of the Spanish electricity market, is on charge of determining the technical feasibility of the generation dispatch provided by the Market Operator. This paper has analysed the role played by power system constraints during the first five years of operation of the Spanish electricity market. In addition, it includes an optimal solution approach included in ARO, a tool for the management of power system constraints in the

8 Spanish market. The tool ARO decouples the solution of branch overloads and voltage constraints determining the minimum-cost redispatch of generation that solves them. VII ACKNOWLEDGEMENTS This work has been developed under the research project ARO developed by software enterprise Indra and Comillas University for Red Eléctrica de España, the Spanish System Operator. The authors gratefully acknowledge the contribution F. Blanco, F. Cacho and M. Pezic of Red Electrica. Thanks also to T. Domínguez, P. Saucedo, N. Hernández, M. Pezic, J. Moreno, E. Acosta, R. de Dios, J. L. Fernandez, M. Llorens (Red Electrica), J. García- Castillejo (now with Endesa) and A. Cortés (now with Gas Natural) for their fruitful comments. REFERENCES [1] Spanish Market Activity Rules (English version). [Online]. Available: [2] E. Lobato, L. Rouco, M. I. Navarrete, R. Casanova, G. López, An LP-Based Optimal Power Flow for Transmisión Losses and Generator Reactive Margins Minimization, presented at 2001 IEEE Power Tech Conf., Porto, Portugal, September [3] E. Lobato, L. Rouco, M. I. Navarrete, R. Casanova, J. García-Castillejo, G. López, An Integrated Tool for Análisis of Power System Constraints in the Spanish Electricity Market, in IEEE/PES 2000 Summer Meeting Proceedings, Seattle, USA, pp , July [4] E. Lobato, L. Rouco, T. Gomez, F. Echavarren, M. I. Navarrete, R. Casanova and G. López, Hourly Solution of Voltaje Constraints in the Spanish Electricity Market, PES 2003 General Meeting Proceedings, Toronto, Canada, July [5] E. Lobato, L. Rouco, T. Gomez, F. Echavarren, M. I. Navarrete, R. Casanova and G. López, Solution of daily voltage constraints in the Spanish electricity market, in Proceedings of 15 th PSCC (Power System Computation Conference), Seville, Spain, June [6] Spanish Ministry of Industry and Energy, Operational Procedures of the Spanish Power System, Madrid, August 1998 (no English version yet). [Online]. Available: [7] The operation of the Spanish power electricity market during 1998, inform presented by the CNE (National Energy Comission) 18 th January 2000, (in Spanish) [8] Informs over the operation of the Spanish power presented by OMEL (Market Operator of the Spanish Power System) (in Spanish)