The impact of market clearing time and price signal delay on the stability of electric power markets

James Nutaro; Vladimir Protopopescu

doi:10.1109/TPWRS.2009.2021211

The impact of market clearing time and price signal delay on the stability of electric power markets

James Nutaro, Vladimir Protopopescu

Research output: Contribution to journal › Article › peer-review

51 Scopus citations

Abstract

We generalize a model, proposed by Alvarado, of the electric power market by including the effects of control and communication. To simulate realistic markets, our model issues control signals only at given times and those signals are delayed during transmission. These two effects transform Alvarado's continuous system into a hybrid system, with consequential effects. The stability analysis of the new system reveals two important properties. First, there is an upper limit on the market clearing time and the delay of the price signal beyond which the system becomes unstable. Second, there is a counter-intuitive relationship between the market clearing time and price signal delay: when the market clearing time is relatively long, delaying the price signal can improve the market's stability while reducing the communication delay can destabilize the market. This counter-intuitive effect shows that the full impact of information technology on power markets can be significant and difficult to anticipate. Therefore, as markets are designed and regulated, careful attention should be paid to the effects of information technology on the market's dynamic behavior.

Original language	English
Pages (from-to)	1337-1345
Number of pages	9
Journal	IEEE Transactions on Power Systems
Volume	24
Issue number	3
DOIs	https://doi.org/10.1109/TPWRS.2009.2021211
State	Published - 2009

Funding

Manuscript received July 01, 2008; revised October 02, 2008. First published May 12, 2009; current version published July 22, 2009. This manuscript has been authored by UT-Battelle, LLC, under Contract DE-AC05-00OR22725 with the U.S. Department of Energy. The United States Government retains and the publisher, by accepting the article for publication, acknowledges that the United States Government retains a non-exclusive, paid-up, irrevocable, world-wide license to publish or reproduce the published form of this manuscript, or allow others to do so, for United States Government purposes. Paper no. TPWRS-00521-2008.

Funders	Funder number
U.S. Department of Energy

Keywords

Power system communication
Power system control
Power system dynamic stability
Power system economics
Power system modeling
Power system stability

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10.1109/TPWRS.2009.2021211

Cite this

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abstract = "We generalize a model, proposed by Alvarado, of the electric power market by including the effects of control and communication. To simulate realistic markets, our model issues control signals only at given times and those signals are delayed during transmission. These two effects transform Alvarado's continuous system into a hybrid system, with consequential effects. The stability analysis of the new system reveals two important properties. First, there is an upper limit on the market clearing time and the delay of the price signal beyond which the system becomes unstable. Second, there is a counter-intuitive relationship between the market clearing time and price signal delay: when the market clearing time is relatively long, delaying the price signal can improve the market's stability while reducing the communication delay can destabilize the market. This counter-intuitive effect shows that the full impact of information technology on power markets can be significant and difficult to anticipate. Therefore, as markets are designed and regulated, careful attention should be paid to the effects of information technology on the market's dynamic behavior.",

keywords = "Power system communication, Power system control, Power system dynamic stability, Power system economics, Power system modeling, Power system stability",

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AB - We generalize a model, proposed by Alvarado, of the electric power market by including the effects of control and communication. To simulate realistic markets, our model issues control signals only at given times and those signals are delayed during transmission. These two effects transform Alvarado's continuous system into a hybrid system, with consequential effects. The stability analysis of the new system reveals two important properties. First, there is an upper limit on the market clearing time and the delay of the price signal beyond which the system becomes unstable. Second, there is a counter-intuitive relationship between the market clearing time and price signal delay: when the market clearing time is relatively long, delaying the price signal can improve the market's stability while reducing the communication delay can destabilize the market. This counter-intuitive effect shows that the full impact of information technology on power markets can be significant and difficult to anticipate. Therefore, as markets are designed and regulated, careful attention should be paid to the effects of information technology on the market's dynamic behavior.

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The impact of market clearing time and price signal delay on the stability of electric power markets

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