Sensitivity analysis of optimal transmission capacity reservation for cross-border exchange of reserve capacity in Northern Europe

Abstract

This paper discusses the impact of Nordic hydro inflow and change in planning period on total costs, optimal transmission capacity reservation, and country wise reserve procurement. The model is intended for the Northern European system including the day-ahead and reserve markets. The main impact of the inflow variation in the Nordic system is on the total costs. The effect of inflow variation on optimal transmission capacity reservation is not significant. Similarly, the main impact of the distinct peak and off-peak period reserve procurement is the flexibility a generating unit gets with shorter planning periods which subsequently results in lower costs. For the case with peak and off-peak distinction, Optimal transmission capacity reservation values in a given day are different whereas the pattern does not change for the whole year. The volume of upward and downward reserves procured was consistent irrespective of the Nordic inflow variation or the shortening of the planning period for reserve procurement.