Abstract
The Iberian electricity markets use a dedicated congestion management market to address network constraint violations arising from zonal day-ahead market dispatches. This market operates in two phases: the first phase resolves local congestion through redispatch, while the second phase restores the balance between generation and demand. This study evaluates the effectiveness of this two-phase approach in the context of a rapidly evolving energy sector. We identify inefficiencies in the current two-phase DACM model and examine the performance of an alternative approach which involves addressing the imbalances after day-ahead congestion management in the balancing market. Using a nine-node system, we demonstrate that each model has its strengths and weaknesses, depending on predicted system conditions. Our findings suggest that a dynamic market model, which adapts based on real-time predictions, offers the greatest efficiency. This adaptive model effectively addresses the challenges posed by intraday trading and the availability of flexible resources, thereby enhancing overall market performance.
The need for system balance restoration after congestion management: an examination of Iberian congestion management markets
