Sequence of days for timeline
I suggest that we think about the pattern of weekdays/weekends when deciding on which days to simulate. If we skip by a multiple of 7, then every day would be the same day of week; if we skip by 8, we would have a cycle of 5 weekdays and 2 weekend days. If we skip by 12, we would have a cycle of M-Sat-Th-Tu-Sun-Fri-W so weeks would alternate between 4 days and 3 days. Would it be better to just pre-select the days to get something consistent like 4-day weeks with one weekend day? Grampajohn 18:09, November 3, 2010 (UTC)
- I do like the idea of having a consistent number of week days and weekends periodically. Skip by 8 seems like a good way to do this. The only drawback, compared to skipping by 12 days, is that we will only be able to simulate about 1.3 years instead of 2 years, so we may not capture seasonal dynamics as well. We could also skip by 15 and get the same 5+2 pattern and simulate a longer time overall. But, would only two days per month be too sparse a sample? PReddy 18:19, November 3, 2010 (UTC)
- A cycle of 12,12,12,13,12,12,12,13,... gives you a 49-day cycle that could run FWMSFWMS...
- Grampajohn 21:04, November 3, 2010 (UTC)
Blueprints needed for each of the "Major Scenarios"
Once we understand how the game progresses in enough detail to understand how the game works, we need to take each of the scenarios and detail them in enough technical detail to begin writing an implementation. As these are written, the scenarios need to link to the blueprints so we know they are done. Grampajohn 14:20, November 4, 2010 (UTC)
What is the initial state of the market?
I have heard two proposals for the "initial state" of the market:
- All customers are subscribed to "generic" fixed-price tariffs, which are evenly distributed among the competing Brokers. Each Broker must immediately begin serving its portfolio, while it develops and offers new tariffs, and negotiates contracts with larger customers.
- Brokers begin with no tariffs, but instead the Distribution Utility holds fixed-price tariffs with all customers. This is a typical state for a new retail market - see Joskow's "Lessons Learned" paper for examples. The key is that the "default" tariffs are fairly unattractive.
In the first case, the Broker may need some leadtime, perhaps 24 hours, to retrieve forecasts and build up a market position in the wholesale market before it must serve its load base.
Grampajohn 23:53, November 7, 2010 (UTC)
After discussion among Wolf, Carsten, Prashant, John, and the Minnesota group, we have decided that for the first year's competition we will take the second approach - brokers start with empty portfolios, and must attract customers away from the "incumbent."
--Grampajohn 05:26, 22 November 2010 (CET)
RTD and RTC modeling
(JDcosta asks: Is the Execution (shorter time interval) and the Contracting (relatively longer look-ahead time horizon) identifiable with the Real Time Dispatch (RTD) over 5-10 minute interval) and Real Time Commitment (RTC over a 1-3 hr ) in a Real Time (as well as a Day -Ahead scheduling optimized over hourly intervals over a 24 hr period ) Market operation of a market design referenced on (for example) page 1964 of the reading material assigned for today's meetup (Chow et al)? (except perhaps for convolution with a time contraction/dialation operator to adjust for the relative differences in the magnitudes of the time periods involved in the proposed Game Design and the Market Design presented in the paper) 
No, we are abstracting away this distinction for the simulation. Because we are concentrating on the distribution side of the market, the only effect of RTD is (potentially) some short-term price variations. However, the simulation is running a one-hour timeslot in 5 seconds, so a resolution of 10 minutes is unrealistic. We treat the one-hour timeslots as discrete quanta, and only balance overall supply and demand over the full timeslot.
Grampajohn 04:04, November 8, 2010 (UTC)
Prices for external balancing
[mdeweerdt & WK:] For a good "mechanism design" we first need to come up with some properties that we would like to the mechanism and the imbalance penalty/fee to have. Do you agree with the following?
- Truth telling should be a dominant strategy in the real-time balancing game, because this will reduce complexity for the brokers: they cannot do better than submit their private information truthfully. We want to avoid having a complete secondary market.
- Private information in this balancing game consists of: the actual (im)balance and a (marginal) cost curve for diverting from this planned consumption/production.
- For repairing the imbalance we need to make sure that the aggregate consumption/production is taken into account. This aggregate needs to add up to zero, possibly using some of the spinning reserve of the ancillary service (in our case of the distribution utility (DU)).
- This balancing game is repeated every time slot (e.g. 15, 30 or 60 minutes). In principle these games can be dependent because of contracts that allow for shifting load/production to another time slot, or the use of batteries. However, we feel that it may be worthwhile to start under the assumption that this does not happen (that often). Possibly the repeated (sometimes also called dynamic) setting could be scheduled for the second version of PowerTAC. Reference: Dynamic-VCG by Ruggiero Cavallo (2006-2009).
- Other nice properties would be cost-efficiency of the system as a whole (i.e. social welfare) and budget balancedness, but these cannot all be attained together with truthfulness.
We propose to model the possibility of a DU to complement (or reduce) production (in order top prevent blackouts) by a marginal cost function such as in the example. In principle the DU plans to operate at the most efficient production level, but in case of imbalances the DU needs to adjust its production (see figure).
[JEC:] Some quick thoughts:
- Regarding #2 - the actual imbalance is not the broker's private information, it's computed by the Distribution Utility. The cost curve is the important bit of private information, I believe.
- Regarding #3 - The other "ancillary service" available is to reduce or increase imports through the wholesale market. The cost curves for that should be available in the records. Derivation of those cost curves is covered pretty well in Shahidehpour Ch. 9.
- Regarding #5 - Social welfare is more important than budget balance, because the Distribution Utility is presumably the one running the market, and it is charging the brokers for services anyway. Any imbalance can be transferred to that account, I would think.
- Regarding the diagram - In most cases, the DU does not actually produce any power except possibly with it's own gas turbines. Virtually all balancing will be done intra-broker and cross-broker, and by increasing or decreasing the amount of power imported from or exported to the transmission grid. Let's not be inventing new mechanisms until we understand what's already being done in the real world.
[Heisteria:] Reply to JEC comment "Regarding the diagram - In most cases, the DU does not actually produce any power except possibly with it's own gas turbines. Virtually all balancing will be done intra-broker and cross-broker, and by increasing or decreasing the amount of power imported from or exported to the transmission grid. Let's not be inventing new mechanisms until we understand what's already being done in the real world." - this statement is unverifiable if current models of the electricity market in the EU and the US are used as a reference. These markets include a day ahead market in which the brokers have to submit their schedules for supplying electricity and estimated demand for each period of the next real time trading day. They have to do this by gate closure time.. If they do this accurately they minimize their costs. If the brokers truthfully say their costs then the market can allocate optimally. Next the DU clears the demand bid and supply bids and makes arrangements to procure all of the ancillary service requirement through awards for ancillary services and other awards. Unmatched bids and offers are cleared intraday using market mechanism. Unforseen demand and increased supply capacity intra-day lead to imbalance. Intra day imbalance can also be caused because brokers are unable to meet the day-ahead schedules of consumption and generation represented the DU before gate closure. For these reasons while Ohm and Kirchoff law say that "balancing is done by increasing the amount of power imported from or exported to the transmission grid" that may not mean that the entire balancing need not involve only intra broker or cross-broker actions. Unless the brokers have understated their generation capacity and overstated their demand in the day ahead market the imbalance is not correctable only by market clearing mechanism. Usually such imbalance is corrected by the balancing authority or the DU using the pre-arranged ancillary resource awards. The DU pays a high price for such service which it passes to the brokers. This is how physical supply and delivery are handled. The graph by mdeweerdt & WK provide the means to find what price the DU must charge broker. It also provide implicit effect of physical constraint of transmission and capacity on determining the price to charge the broker for not meeting stated day-ahead schedules. The forward contracts between brokers is another matter because they do not involve physical delivery. Only financial settlement or hedging of the broker positions involving money changing hands. This is the case where virtually all of the balancing can involve only intra broker or cross-broker action. In your case, the simulation does not have any day-ahead market or any explicit type of financial only modes or hedging. Balancing in your model is physical supply and consumption balancing but your game design is design only suitable for financial trades because no require any day-ahead or other optimal allocation of electricity demand and supply. The only "inventing new mechanisms" in this case is the game design adopted which does not exist in any electricity trading markets in any continent at this time. Unless you are trying to introduce the wall street model of trader centered marketplace with quick and fast trading. In such case your model is optimal because the broker can quickly make a profit and exit the market. The actual value creators for society which are suppliers, transmitters and consumers left in darkness. If virtually all balancing by intra and cross-broker trades then market effeciency is by brokers or broker sponsored agencies taking over function of DU. This also make certain that if consumer get any wealth advantage by local renewable generation the broker agencies can make bid and offer among themselves or make tariffs and tariff penalty so the wealth advantage go from consumer to broker.