The energy system is changing rapidly. For example, wind power is entering the market and old fossil fuel-based energy sources are being phased out at the same time. As a result, we have to develop the rules of the electricity market and it’s important to communicate with different parties about the changes,” says Expert Mikko Heikkilä from Fingrid as he justifies the need for the website.
A couple of years ago, it was assumed that the change would happen in stages and sometime far into the future. Now the market transformation is expected to happen in 2020–2021, when the electricity market will undergo substantial changes nearly simultaneously. These include introduction of the Nordic balancing model and the transition to 15-minute imbalance settlement.
“The upcoming change is a big one for us, but even more so for our customers. We want to meet their needs by sharing easy-to-understand basic information about the changes and their impacts.”
Keep an eye on the website
Stepping into the Electricity Market Future is an online concept that will bring together up-to-date information about changes in the electricity market. Once the information is online, it can be updated easily to guarantee that it remains current. Content was previously distributed in print format, which means that in some ways it was outdated before the ink had dried.
The website will include a discussion forum where visitors can comment on the content. It’s also possible to present questions in the discussion area for Fingrid experts to answer. This is Fingrid’s way of increasing openness and dialogue with the industry.
Stepping into the Electricity Market Future will become part of Fingrid’s public website. Its target group includes electricity market actors with an interest in the wholesale market, which can be large electricity users, electricity producers, distribution grid companies and reserve market parties, such as aggregators.
Fingrid’s specialists are responsible for content production for the site in their respective areas of expertise. The website was introduced at the end of November at the Fingrid Current stakeholder event.
At the heart of the Nordic balancing solution
The procedure for balancing electricity consumption and production will be comprehensively explained to market operators on the website.
The Nordic transmission system operators negotiated intensively about updating balancing. Last spring, the TSOs reached agreement on how to implement balancing in the future, and the new balancing model has been under construction since then.
“The new solution consists of balancing energy marketplaces and a new way to implement balancing. This is the so-called ACE (Area Control Error) model, which emphasises the importance of balance in individual bidding areas during real-time balancing. Today the Nordic countries are balanced together as a common entity, mainly according to electricity grid frequency,” states Heikkilä.
The biggest change for market operators will be the new balancing energy marketplaces.
“The Automatic Frequency Restoration Reserve (aFRR) capacity market will begin operating in 2019.”
What is 15-minute balancing?
The concept of 15-minute balancing is a central part of the new balancing solution.
“The electricity market currently trades in one-hour products, but in the future electricity will be bought and sold in 15-minute periods,” says Heikkilä.
The background for this change is the fact that the physical power system will change as more solar and wind power, which fluctuates rapidly according to the weather, comes to electricity production.
“In order to keep electricity production and consumption in balance all the time, the market must be given the opportunity to handle balancing and trade in periods of less than one hour.
According to Heikkilä, preparation of the balancing model is progressing in good cooperation between the Nordic operators.
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