Integrating the central-dispatch markets into the European balancing platforms: main lessons learnt and challenges

Abstract

In European balancing markets, there are two co-existing market models based on the adopted dispatch process. In a self-dispatch model, the market players are in charge of determining the operational schedule of their generation and consumption units since, at an overall market level, only the overall trading position of each player is determined. On the other hand, under central-dispatch, the scheduling and dispatching of individual units are determined centrally. In the European context, the integration challenges faced by the central-dispatch scheme are larger than those faced by a self-dispatch system. We discuss the main integration challenges faced by a central-dispatching system along with the approach followed by different TSOs to address them. We also examine how these approaches can be applied to other market design problems.In European balancing markets, there are two co-existing market models based on the adopted dispatch process. In a self-dispatch model, the market players are in charge of determining the operational schedule of their generation and consumption units since, at an overall market level, only the overall trading position of each player is determined. On the other hand, under central-dispatch, the scheduling and dispatching of individual units are determined centrally. In the European context, the integration challenges faced by the central-dispatch scheme are larger than those faced by a self-dispatch system. We discuss the main integration challenges faced by a central-dispatching system along with the approach followed by different TSOs to address them. We also examine how these approaches can be applied to other market design problems.