Electricity market complexity

Once complete in 2015, the four-reactor Cernavoda complex will produce 2,600 MWe of baseload nuclear electricity (WNA-Romania, 2008), sufficient for roughly 40 percent of Romania s electricity needs. While in 2008 the Romanian electricity market remains 70 percent regulated and 30 percent liberalized, by 2015 it is planned that the entire market will have been liberalized. As such, it seems probable that Cernavoda 3 and 4 will spend their entire operating lives in entirely liberalized electricity markets (Bucur, 2008). 

Increased complexity of coordination arising from the implementation of optimal power flow based on the electricity markets... 

The reliability of a modern electric power system depends on continuous real-time control of power and energy production, transmission line flows, system frequency, and voltage. This complex task will get more involved in the new environment with increased market participation on both the supply and the demand sides. 

We represent the difference between the behaviour of individual generators and the impact on the system price by defining the add-on and the work-on rate. In a competitive environment, generators add-on the opportunity costs of C02 allowances to the power price. The increase of the bid of the marginal unit will then determine how much of the C02 allowance prices are worked-on the electricity price. However, in a liberalized market, prices are ultimately determined by a complex set of market forces. As a result, the work-on rate may be lower than the add-on rate. 

The promise of a huge high-reliability market was built around a myth. Understanding the true potential size of the high-reliability market requires an understanding of the complex interplay between the growth of the Internet and the digital economy s effect on electricity demand. Early analyses of these issues created a myth that raised false expectations in the market. 

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