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Overview of the hottest U.S. electricity market

2022-10-03

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Overview of the U.S. power market

before 1992, the U.S. power system adopted vertical integrated management. Most power enterprises have power generation, transmission and power supply businesses at the same time. Users can only purchase electricity from power suppliers in their residential areas. The electricity price is monopolized by power enterprises, and there is no competition in the market

with the rise of fuel prices, inflation and interest rates, as well as the soaring cost of nuclear power, power prices in many states in the United States began to rise on a large scale. Many users attributed the rise to the monopoly of power companies. The voice of power market participants and users for fair competition and non discriminatory opening of transmission networks is growing

the goal of American power market is to reduce power generation investment and operating costs by establishing a competitive power wholesale market. At the same time, the power transmission and distribution links shall be supervised. Because transmission and distribution have the characteristics of transmission channel construction, the U.S. power market restricts the use of regulatory means for transmission and distribution

therefore, the road of power market construction in the United States began

legal framework

in 1996, the Federal Energy Regulatory Commission FERC issued decree 888, which is mainly to open the transmission network without discrimination. Decree 888 comprehensively stipulates to correct unfair discrimination in the opening of monopoly transmission lines and realize the opening of transmission networks, including network transmission services and point-to-point transmission services. It requires transmission networks to open transmission services and provide non discriminatory transmission services with minimum service terms and conditions

decree 888 stipulates that the owner of electricity cannot own power generation and power supply enterprises at the same time, and encourages the construction of RTO (regional electricity operation center)/iso (independent system operation center) to manage the operation of the entire transmission system. Rto/iso effectively separates the operation function of vertically integrated power system with natural monopoly by separating the operation control right of transmission network from its ownership and the operation control right of power generation and transmission. RTO is responsible for the electricity within the scope of dispatching responsibility and has the right to decide the dispatching instructions

decree 888 requires rto/iso to have the following functions

o/iso must be independent of each power market participant

o/iso is the fair representative of all users of the system. Rto/iso and its equity have no interest relationship with power market participants

o/iso must provide open and non discriminatory transmission services for all qualified users. Rto/iso conducts transmission scheduling. Transmission services must be charged according to a fully unified, rate priced tariff

o/iso must be responsible for the reliable operation of electricity in short-term mode

decree 888 was promulgated soon. In 1996, FERC issued decree 889. In order to cooperate with the transmission network opening No. 889 law, information disclosure requirements are put forward for power market participants, and quantitative provisions are made for information disclosure

in 1999, FERC issued the decisive Decree No. 2000 establishing rto/iso, which made it clear that rto/iso implements a unified real-time operation mode, It is clear that rto/iso should fulfill the following requirements: Slater told the American fast company magazine station: "Most plastic waste is still responsible for the following duties.

1. price management and design

2. Congestion management

3. parallel power flow management

4. Auxiliary services

5. Determine the total available transmission capacity in the system

6. Market regulation

7. Planning and expansion

under this framework, the United States has formed California, Midwest, New England, New York, northwest, pjm southeast, southwest , spp and Dezhou 10 regional power markets

basic framework of the market

the construction of American electricity market is related to its natural characteristics. It has the following characteristics: first, the property rights are relatively scattered, the number of national power companies is large, and the scale difference is relatively large; Second, the regional power dispatching operation is formed spontaneously by power companies, and the dispatching operation modes are quite different; Third, there is no dispatching management mechanism at the national level, and joint dispatching is adopted among regional power systems

1. Independence and openness of transmission

in 2002, the United States proposed the design SMD of standard electricity market. SMD proposes to separate the power generation and sales businesses of transmission companies and establish an independent transmission service provider ITP, whose responsibilities include the construction, ownership, management and operation of transmission networks, which has become a regulatory link of the market. It cannot carry out trading business in the market, open transmission without discrimination, and provide standardized services

d transaction mode

in terms of transaction types, SMD proposes electric energy transaction, capacity transaction, auxiliary transaction and transmission right transaction. Establish the capacity market to ensure the power supply; Establish wholesale market and improve efficiency; Establish an auxiliary market to ensure the stable implementation of power trading

prepared for the possible impact of all aspects. In terms of transaction mode, it replaces the previous centralized transaction mode and recommends the bilateral transaction mode

in the transaction time series, there are four types: long-term, day ahead, hour and real-time

d transaction electricity price mode

smd recommends that the node marginal electricity price be used for the electricity price (LM product performance is stable P). At present, most of the U.S. power markets use LMP theory, including PJM, New York power market, New England, Texas and California power markets

smd adopts two-part electricity price for transmission price, including capacity part and electricity part, that is, transmission capacity cost and electricity transmission cost

pjm power market characteristics

pjm power market is the Pennsylvania New Jersey Maryland joint power market. PJM, founded in 1927, is the largest interconnected power system in North America and the fourth largest centralized dispatching interconnected power system in the world

pjm is a relatively successful case in the power market. It does not own any transmission lines, substations, generator sets or other power facilities. It is an independent entity and has no connection with any power market participants. PJM is the market neutral party, responsible for the organization of the market and the reliable operation of the transmission network. In essence, PJM is a dispatching and market operation organization that does not own power system assets

pjm is a typical RTO. Under the constraint of safety, it implements economic dispatching, uses the lowest cost unit to meet the system load, and is committed to running a reliable and efficient quotation based market

PJM sets up an independent board of directors and a member committee, which is composed of five professional committees: power producers, end users, transmission companies, distribution companies and other suppliers. The member committee makes recommendations to the board of directors on the needs of members