RAE NRAA 210721
Transcript of RAE NRAA 210721
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Ημερίδα ΡΑΕ 21.07.2021Ο οδικός χάρτης του Market Reform Plan και
ο σχεδιασμός για την Αξιολόγηση Επάρκειας Πόρων σε εθνικό επίπεδο
ERAA και Εθνική Μελέτη Επάρκειας Ισχύος Ελευθερία Κονταξή
Τομεάρχης Μελετών ΑγοράςΑΔΜΗΕ Α.Ε.
1
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
General Context
In October 2020 ACER adopted methodologies for the EuropeanResource Adequacy Assessment (ERAA) and for the calculation of theReliability Standard (RS), with decisions 24/2020 and 23/2020respectively.
The ERAA aims to provide a consistent and comparable basis on aEuropean level, gives key insights into the adequacy of supply to meetdemand, and identifies resource adequacy concerns (and their causes).
The ERAA results should help to inform the EU Member States,National Regulatory Authorities (NRAs) and stakeholders about theforecast level of security of supply in the EU.
The ERAA results may also serve as a basis to consider different marketdesign options pursuant to Articles 20 and 21 of Electricity Regulation(EU) 2019/943.
2
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
National Resource Adequacy Assessments
In line with Article 24 of the Electricity Regulation (EU) 2019/943, complementary national resource adequacy assessments may be conducted.
National resource adequacy assessments have a regional scope and are based on the ERAA methodology.
National resource adequacy assessments may include additional sensitivities.
3
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
ERAA Methodology – Key features
The ERAA methodology brings several changes and updates to the methodology used for adequacy assessment, while the scope of the assessment is significantly extended.
New key features include: Probabilistic market modelling: Full Monte Carlo simulations are the core
of the methodology Economic Viability Assessment (EVA): The ERAA requires the
incorporation of an investment module, which will assess the economic viability of capacity resources and their potential exit from the market
Capacity Mechanisms (CMs): The impacts of approved, existing and planned CM assets on adequacy should be studied separately
Impact of Climate Change Flow-based Sectoral integration
4
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
ENTSO-E & ERAA
5
Topic MAF 2020 ERAA Methodology StatusModelling approach Probabilistic Probabilistic
100%
Publication frequency Annual Annual100%
Network NTC approach. Testing Flow-Based approach since 2018
Compliance with Flow-Based approach50%
Target years and time horizon
2 target years within a 10 year horizon 10 target years within a 10 year horizon25%
Available resource capacity
Bottom-up expectations Bottom-up expectations followed by Economic Viability Assessment 25%
Capacity mechanisms No explicit considerations Effect of Capacity Mechanism integrated25%
Sectoral integration None Integration of Power to Gas, Power to Hydrogen, etc.
0%
The ENTSO-E Midterm Adequacy Forecast (MAF) – ERAA methodology gap analysis
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
New Adequacy Study of IPTO
IPTO is currently preparing the new national adequacy study covering the period 2022 – 2031.
The new adequacy study will be used as a supporting document for the notification of the Strategic Reserves Scheme and the long-term CM as envisaged by the Greek Government.
According to the EU processes for approving CMs, the new Study will need to be submitted to ACER for an approval of compliance with the ERAA methodology.
Two basic steps are required: Full alignment of IPTO adequacy study with the ENTSO-E MAF
methodology, as applied in the 2020 report Adoption of any methodological advances made by ENTSO-E for
the ERAA 2021 report
8
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Main inconsistencies between up-to-now IPTO methodology and ERAA
Beyond the lack of considering the new features imposed by the ERAA methodology, the followed up-to-now methodology by IPTO for assessing national generation adequacy levels fell short, comparing to the ENTSO-E MAF methodology, in the following areas:
Use of Monte Carlo simulations, even though probabilistic simulations were performed (convolution technique)
Accurately accounting for the contribution to national adequacy of interconnections with neighboring countries
Modelling of new types of generation resources (DSR, batteries) Handling of climate correlated hydro generation
9
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Aligning with the ERAA methodology
Several new features will be incorporated in the new adequacy study: Simulations will be performed using the ANTARES tool, developed
by RTE, allowing for: hourly Monte Carlo simulations the same level of modelling of capacity resources, demand and
the grid side, as in ENTSO-E adequacy studies. Consideration of reference scenarios with and without CMs Consideration of the national market reform plans Economic Viability Assessment (EVA) will be performed The impact of Climate Change will be taken into account
For the first time, IPTO launched a public consultation on the key elements of the new study, namely input data and assumptions
10
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Geographical Perimeter
11
Neighboring countries of Greece, as well as the rest of the Balkan region are considered (explicitly or non-explicitly)
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Basic Assumptions All basic input for the new adequacy study has
been obtained from the ENTSO-E ERAA 2021 study data collection (data release May 2021)
TSOs provided data aligned with their national NECPs, taking into account best estimates and their national TYNDP, as well as information regarding uncertainties concerning retirement dates of existing units or entrance of new units.
It is highly unlikely that any new investment in hard coal or lignite units will be realized in EU countries, or in non-EU countries.
IPTO has opted for a more environmentally ambitious and conservative (with respect to contribution to the greek system adequacy) -yet realistic- storyline.
12
DATA OBTAINED FROM ENTSO-ECapacity, technical and operational
characteristics of resources (thermal, hydro, RES, storage, DSR)
DemandNTCs
Fuel & CO2 prices
BG and RO will opt for earlier retirement of old coal/lignite or oil unitsAny foreseen investments in the region in new coal/lignite or oil units, that are not already under construction, are cancelled. New investments in new CCGTs, as well as refurbishments of old gas units are assumed to be realized.
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Other General Assumptions
Scope: The new study is a National Resource Adequacy Assessment (NRAA) which aims to provide a complementary analysis to the ERAA 2021 report on future adequacy levels and potential risks in Greece, under different conditions. In all cases hypotheses for neighboring countries will remain constant and the analysis will focus on future national adequacy levels and viability of investments in Greece.
Reliability Standard (RS): The considered RS (threshold of LOLE index) will be determined by the Greek State
Value of Lost Load (VoLL): It is necessary to use a single VoLL for all explicitly modelled zones, including Greece, regardless of national set values for VoLL. A common value of 15.000 €/MWh will be considered.
13
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
National Assumptions – Base Case Scenario Without CM The Base Case Scenario (Without CM) stems from the approved NECP,
taking into account best estimates and the most recent national TYNDP (TYNDP 2022-2031). Key points are the following: Lignite units are retired according to the time-schedule announced by PPC
through official letters. Only new thermal units that are currently under construction are considered
to be added to the system. RES evolution reaches the foreseen targets of the approved NECP in 2030,
however for some technologies (mainly PV), with a higher penetration rate in the first years.
The new hydro pumped-storage unit foreseen in the NECP is not considered in this scenario.
Batteries participating in the market are considered, as in the NECP. Conservative development of in-market DSR is assumed. Demand evolution is considered according to the NECP as given in the latest
TYNDP.
14
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Methodology – Base Case Scenario Without CM
15
The following steps are taken:
1. Perform probabilistic simulations to calculate reliability indices.
2. If an adequacy concern is identified (meaning that the ReliabilityStandard (RS) is not met), Out-of-Market Measures are applied,to see if the concern is resolved.
3. Perform an Economic Evaluation Assessment (EVA), in order tocheck the viability of groups of capacity resources defined in theBase Case Scenario. Out-of-Market Measures are not consideredin this step.
4. If non-viable groups of capacity resources are identified, theimpact of their potential decommissioning on adequacy isevaluated.
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Methodology – Base Case Scenario With CM (I)
16
The general approach for the Scenario With CM is the following:
1. If an adequacy concern was identified after the application ofOut-of-Market Measures in the Scenario Without CM, therequired additional capacity (missing capacity) to fulfill the RSis determined.
2. Economic Evaluation Assessment (EVA) of capacity resources isnot necessary for this scenario, as it is assumed that the CM willprovide sufficient revenues to keep the required capacity viable.
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Methodology – Base Case Scenario With CM (II)
17
For the purposes of the new adequacy study, two different capacityrenumeration mechanisms are considered, as planned by the GreekState:
1. For the period 2022 - 2023: The Strategic Reserves Mechanismis envisaged to be in place. Any missing capacity will becovered by existing lignite units and DSR that will participatein the mechanism.
2. From the end of 2023 and on: The Long-term CapacityMechanism is envisaged to be in place. The CM is planned to betechnology neutral and for this reason any missing capacity willbe determined by adding gradual steps of firm capacity (capacitywith 100% availability), until the RS is met.
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Methodology – Economic Viability Assessment (EVA)
18
For the first implementation of this assessment, IPTO has opted forassessing the economic viability of (groups of) capacity resources,rather than minimizing the overall system cost (optimal expansionplanning).
Economic viability will be defined based on the difference betweenrevenues and costs. A capacity resource will be viable if its revenues arehigher than or equal to its costs.
Specifics of implementing this approach are still a work in progress.
All details of the methodology that will be followed and assumptionsmade will be provided in the study.
21.07.2021 - Ημερίδα ΡΑΕ: Market Reform Plan & NRAA
Sensitivities
Sensitivities may be performed in order to evaluate the impact of crucial parameters on adequacy, as well as on the viability of capacity resources. The sensitivities could include: Higher load forecasts and/or Higher penetration of capacity resources (thermal, RES, storage,
DSR) Any additional sensitivities examined will be focused on a limited
number of Target Years (TY) and depending on the scope may be limited to either adequacy analysis or EVA analysis.
19