Assessment of nodal pricing applied to imbalance settlement: Approaches and issues for implementation in zonal markets

Abstract

The described work analyses the issue related to the application of a nodal pricing methodology to the Italian power system. If on one side the nodal pricing methodology has proven to be the best possible solution for electric energy, on the other side the application to the Italian power system introduces some problems. This paper presents the peculiarity of application to the Italian real time balancing market with a scenario developed on a case study in order to show up the possible system distortions.