Power Markets and Economics: Energy Costs, Trading, Emissions

Foreword

Preface

Part One Industry Infrastructure

Chapter 1 Approach to Restructuring

1.1 Introduction

1.2 Industry Physical Structure

1.3 Introduction of Competition

1.4 Restructuring Options

1.5 Comparison of Structures

1.6 Summary

Chapter 2 Market Mechanisms

2.1 Introduction

2.2 Market Participants

2.3 Market Mechanisms

2.4 Market Implementation

2.5 Price Analysis

2.6 Summary

Part Two The Cost Chain

Chapter 3 Basic Generation Energy Costs

3.1 Introduction

3.2 Cost Components

3.3 Practical Operating Efficiencies

3.4 Impact of Utilisation on Costs

3.5 Comparison of Generation Costs

3.6 International Comparisons

3.7 Summary

Chapter 4 Alternative Energy Sources

4.1 Introduction

4.2 Competing Sources

4.3 Current Production Europe

4.4 Incentive Schemes

4.5 Market Pricing

4.6 The Economics of Alternative Sources

4.7 Comparisons

4.8 Summary

Chapter 5 Emissions

5.1 Introduction

5.2 Emission Trading Schemes (ETS)

5.3 Large Combustion Plant Directive (LCPD)

5.4 Generation CO2 Emissions

5.5 Production Costs

5.6 National Allocation Plans

5.7 Market Operation

5.8 Impact of Capacity Mix

5.9 International Approach

5.10 Summary

Chapter 6 Transmission

6.1 Introduction

6.2 Impact of Transmission Constraints in Markets

6.3 Transmission Charging

6.4 Derivation of Use of System Charges

6.5 International Tariff Comparisons

6.6 Transmission Investment

6.7 Interconnection Investment Appraisal

6.8 International Practice

6.9 Summary

Chapter 7 Distribution

7.1 Introduction

7.2 Market Status

7.3 Commercial Arrangements

7.4 Metering and Balancing

7.5 Cost of Distribution

7.6 Distribution Tariffs

7.7 OPEX Regulation

7.8 Capex Regulation

7.9 Business Risk

7.10 Distributed Generation

7.11 Summary

Chapter 8 End User Charges and Prices

8.1 Introduction

8.2 Price Comparisons

8.3 End user Energy Prices

8.4 Total End User Prices

8.5 Tariff Development

8.6 Customer Switching

8.7 Summary

Part Three Market Operation

Chapter 9 Market Trading

9.1 Introduction

9.2 European Markets

9.3 Developing Markets – China

9.4 Market Power

9.5 Trading Arrangements

9.6 Bilateral Trading

9.7 Balancing Market

9.8 Exchange Trading

9.9 Supplier Risk

9.10 Generation Risk

9.11 Market Interaction

9.12 Arbitrage Spark Spread

9.13 Summary

Chapter 10 Market Analysis

10.1 Introduction

10.2 Modelling Overview

10.3 Dispatch Market Simulation

10.4 Load Duration Model

10.5 Hydro Generation

10.6 Interconnection Modelling

10.7 Predicting Demand Data

10.8 Generation data

10.9 Calculations

10.10 Price Duration Curve

10.11 Statistical Forecasting

10.12 Predicting New Entry

10.13 Summary

Chapter 11 Ancillary Service Markets

11.1 Introduction

11.2 Ancillary Service Requirements

11.3 Market Volume

11.4 Procurement Process

11.5 Cost of Providing Services

11.6 Predicting Revenues

11.7 Summary

Chapter 12 Cross-border Trading

12.1 Introduction

12.2 Governance

12.3 Cross-border Capacity

12.4 New Investment

12.5 Managing Operation

12.6 Capacity Auctions

12.7 Security

12.8 Charging for Wheeling

12.9 International Trading Development

12.10 Summary

Chapter 13 Investment Appraisal

13.1 Introduction

13.2 Overall Analysis

13.3 Analysis of Options

13.4 Plant Costs

13.5 Predicting Revenue

13.6 Bidding/Contracting Strategy

13.7 Evaluating Risk

13.8 Summary

Part Four Market Development

Chapter 14 Market Performance

14.1 Introduction

14.2 Performance Criteria

14.3 Market Shortcomings

14.4 Performance Assessment

14.5 Performance Improvement

14.6 Summary

Chapter 15 Market Developments

15.1 Introduction

15.2 Generation Developments

15.3 Future Plant Mix

15.4 Transmission and Distribution Grids

15.5 Carbon Capture and Storage

15.6 Market Implications

15.7 Summary

Chapter 16 Long-term Scenarios

16.1 Introduction

16.2 Emissions

16.3 Alternative Energy Sources

16.4 The Nuclear Option

16.5 Fuel Prices

16.6 Fuel Supply Security

16.7 System Security

16.8 Clean Coal Technology

16.9 Network Developments

16.10 International Commodity and Freight Markets

16.11 Competition

16.12 Conclusions

Glossary

References

Appendix Conversion Tables

Index