Power Trading – ¼ h products
Strommarkttreffen – TU Berlin, 13.05.2016
Vincent Thevenin, Portfolio Manager, Front Office of 50Hertz
Agenda
1. Introduction
2. Market fundamentals
3. Market design and trading
4. Impact on the grid
5. Case study: solar eclipse
6. Summary and outlook
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
2
Introduction
Motivation – a changing energy system in Germany
Conventional
power plants
Attribute
Renewable energy
sources
• Number #
• 500
• 1.3 Mio
• Installed capacity P
• 100 GW
• 93 GW
• Gradient ΔP/Δt
• ~ +/- 50 GW/h
• ~ +/- 10 GW/h
(flexibility)
(to be compensated)
Weather-dependent power plants implie need for flexibility
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
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Market fundamentals
1/4h-products: an instrument for flexibility
Who are the market players in Germany?
Player
Need for 1/4h-products
TSOs
Solar (and wind) ramps
Direct marketers
Wind (and solar) ramps
Utilities
Power plant ramps
Electric supply companies
Profile of consumers
Different needs meet at the market
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
6
Photovoltaic ramps
Hour 17-18
Sell
0-15 mn
15-30 mn
17Q3 17Q4
17Q1 17Q2
Buy
30-45 mn
45-60 mn
PV-ramps and market design lead to a need for 1/4h-products
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
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Market design and trading
A typical day for ¼ h products
D: delivery day
D-1
10:12
15:00
¼-h + hourly
¼-h auction
12:00
auction
hourly auction
D
ID-continuous
ID-continuous
3 possibilities per day to trade 1/4h products in Germany
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
9
Market design and volumes
Start,
Market opens
2 hours before
delivery*
Market opens
at 4 pm, D-1
Start 1/4h
Switzerland
ID-continuous
Start EXAA
1/4h-Auction
Start 1/4h
Austria
ID-continuous
Start EPEX
1/4h-Auction
Lead time
reduction from 45 to
30 mn to delivery
Volumes driven by market design
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
10
Evolution of the trading time (ID-continuous)
Each point
is a trade
Trading time driven by market design
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
11
Market design: what comes next?
•
Nordpool: trading until delivery, since 02.2016 within each German control area
Better forecast for renewable energy sources: more volumes ?
•
EPEX Spot: 30-mn contracts for FR, DE, CH: around Q4 2016/Q1 2017
Implicit access to interconnection capacity and launch of these contracts on EPEX
SPOT organised markets : planning under finalization
•
XBID Project: pan European Intraday-Market: around Q3/Q4 2017
Cross border trading until one hour before delivery
Probable impact on volume and prices
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
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Impact on the grid
Impact on the grid – Imbalance power
German yearly mean imbalance
power (MW)
1000
500
2012
2013
2014
2015
0
-500
23Q2
22Q3
21Q4
21Q1
20Q2
19Q3
18Q4
18Q1
17Q2
16Q3
15Q4
15Q1
14Q2
13Q3
12Q4
12Q1
11Q2
10Q3
09Q4
09Q1
08Q2
07Q3
06Q4
06Q1
05Q2
04Q3
03Q4
03Q1
02Q2
01Q3
00Q4
-1500
00Q1
-1000
Netzregelverbund („NRV“-Value): imbalance power in Germany
Significant improvement
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
14
Impact on the grid - Frequency
Mean daily evolution of the frequency in the 50Hertz control area
January – Mai 2012
Hz
Significant impact on the frequency
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
15
Case study: solar eclipse
Solar eclipse on March 20th, 2015
PV-Trading on 20.03.2015 for all Germany (TSOs and direct marketers)
ca. 19 GW / 90 min
5.1 GW
Historical Value (Wind+PV) on November 9th, 2013: 10.5 GW / 90 min
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
17
Market prices and volumes on March 20th, 2015
11Q1: 464 €/MWh
11Q1: 464 €/MWh
11Q4: -149 €/MWh
11Q1: 464 €/MWh
11Q1: ca. 8 GW
11Q4: ca. 6 GW
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
18
Solar eclipse on March 20th, 2015 : supply
80
Wind Onshore
70
Wind Offshore
Solar
Power (GW)
60
PSW-Speicher
Hydro-storage
50
Hydro- ROR
Laufwasser
PSW
Hydro
40
Biomasse
Biomass
30
sonstige
Rest
20
Erdgas
Gas
Steinkohle
Hard coal
10
Lignite
Braunkohle
Nuclear
Kernkraft
0
Time
Export
To a significant extend, the eclipse was exported, and to some extend
leveled out in Germany by hard coal and pumped hydro.
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
19
Summary and outlook
Summary
•
•
•
•
¼-h trading: an important flexibility product
Volumes growth through market design
Trading of ¼-h products impacts the grid
Solar eclipse: a successful stress test for the market
Outlook
• Wish: 1/4h-Trading at 12:00 DA !
• More renewable installed capacity in the future
• Flexibility on the consumer side
• Demand side management
• Power-to-X
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
21
Many thanks for your attention!
Vincent Thevenin
Portfolio Manager
Front Office
50Hertz Transmission GmbH
Eichenstraße 3A
12435 Berlin
[email protected]
www.50Hertz.com
London, April 1st 2016
Prices and volumes
MCP: Market Clearing Price, Day-Ahead Epex Spot
Seasonal effects play a role for volumes and prices
Electricity Trading and Market Dynamics, BIS GROUP
Strommarkttreffen, TU Berlin, 13.05.2016, Vincent Thevenin
23