Electricity exchange and the valuation of transnational transmission access: A case study of intra-regional integration of the electric industries of Argentina and Chile
The interconnection of neighboring electricity networks provides opportunities for the realization of synergies between electricity systems. Examples of the synergies to be realized are the rationalized management of the electricity networks whose fuel source domination differs, and the exploitation of non-coincident system peak demands. These factors allow technology diversity in the satisfaction of electricity demand, the coordination of planning and maintenance schedules between the networks by exploiting the cost differences in the pool of generation assets and the load configuration differences in the neighboring locations. The interconnection decision studied in this dissertation focused on the electricity networks of Argentina and Chile whose electricity systems operate in isolation at the current time. The cooperative game-theoretic framework was applied in the analysis of the decision facing the two countries and the net surplus to be derived from interconnection was evaluated. Measurement of the net gains from interconnection used in this study were reflected in changes in generating costs under the assumption that demand is fixed under all scenarios. With the demand for electricity assumed perfectly inelastic, passive or aggressive bidding strategies were considered under the scenarios for the generators in the two countries. The interconnection decision was modeled using a linear power flow model which utilizes linear programming techniques to reflect dispatch procedures based on generation bids. Results of the study indicate that the current interconnection project between Argentina and Chile will not result in positive net surplus under a variety of scenarios. Only under significantly reduced interconnection cost will the venture prove attractive. Possible sharing mechanisms were also explored in the research and a symmetric distribution of the net surplus to be derived under the reduced interconnection cost scenario was recommended to preserve equity in the allocation of the interconnection gains.
|Year of publication:||
|Authors:||Brereton, Beverly Ann|
|Type of publication:||Other|
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