Electric Power Optimization Centre Our research uses mathematical

Renewable Generation How can potentially volatile renewable energy sources be optimally integrated into the

Demand-side Management Cost ($) How can consumers of electricity adjust their load patterns to

Smart Grid How do we design switching networks that reconfigure automatically in case of

Regulation How efficiently does the market How do electricity market reforms perform, compared to

Diagnosing Market Power Issues In markets with imperfect competition, it may be possible to

Hedging Locational Pricing Dollars Locational electricity prices at all nodes are recomputed every 5

EPOC Members Directors: Prof. Andy Phipott Dr. Golbon Zakeri Members: Dr. Geoff Pritchard Dr.

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Electric Power Optimization Centre Our research uses mathematical modelling, optimization and statistical tools to comprehend modern electricity markets such as the NZEM, and to analyze and develop methods for efficient generation schemes and demand-side participation. http: //www. epoc. org. nz

Renewable Generation How can potentially volatile renewable energy sources be optimally integrated into the electricity market? For example: – Wind power – Solar power – Distributed generation – Wave energy – Tidal power © Luke Milliron, 2010

Demand-side Management Cost ($) How can consumers of electricity adjust their load patterns to reduce energy costs? Spot Price Reserve Price When is the optimal time to shut-down operations? Source: Graeme Everett, Norske Skog 90 80 70 60 50 40 30 20 10 0 Energy Price Interruptible Load Price 20 22 24 26 28 30 32 34 36 38 40 42 44 46 48 2 Trading periods when production line shuts should be taken. 4 6 8 10 12 14 16 18 Trading Period 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 46 47 48 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 TMP 1 TMP 2 RMPA RMPB Operate Shutdown

Smart Grid How do we design switching networks that reconfigure automatically in case of failure? Below is an illustration of a least cost capacity expansion to give a self-healing distribution network. 17 5 17 3 17 6 17 17 177 9 8 demand point new demand point existing line candidate line selected line zone substation connection to source candidate switching station 17 017 1 17 4 17 2 16 16 9 8 16 7 16 6 Least-cost expansion is unreliable. 17 5 17 3 17 6 17 17 177 9 8 17 017 1 17 4 17 2 16 16 9 8 16 7 16 6 Optimal self-healing expansion: more expensive, but robust to line failures.

Regulation How efficiently does the market How do electricity market reforms perform, compared to a centrally affect market efficiency? planned system? We model: – Asset reallocation – Financial transmission rights – Market monitoring – Futures trading – Scarcity pricing – Emissions trading Hydro reservoir storage comparison.

Diagnosing Market Power Issues In markets with imperfect competition, it may be possible to exert market power by increasing the offer prices above true marginal cost. Offer Stack $100 $80 Price (/MWh) Every half-hour electricity generators submit offer stacks, specifying the price and amount of power they are willing to sell into the wholesale market. $60 $40 $20 $0 0 100 200 300 400 500 600 700 Quantity

Hedging Locational Pricing Dollars Locational electricity prices at all nodes are recomputed every 5 minutes. This creates a risk for firms that buy and sell power at different locations. How can firms manage this risk? Otahuhu 120 Source: comitfree 100 80 60 40 Benmore 20 0 Time of Day 3 am-6 am 6 am-9 am Prices over a day at Otahuhu and Benmore.

EPOC Members Directors: Prof. Andy Phipott Dr. Golbon Zakeri Members: Dr. Geoff Pritchard Dr. Tony Downward Assoc. Prof. Rosalind Archer Visit Our Website: http: //www. epoc. org. nz Amelia White (2012)