Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/262344 
Year of Publication: 
2022
Series/Report no.: 
ECONtribute Discussion Paper No. 182
Publisher: 
University of Bonn and University of Cologne, Reinhard Selten Institute (RSI), Bonn and Cologne
Abstract: 
A local flexibility market is presented that addresses intrazonal congestion in a zonal electricity market. The market lets system operators access flexibility at multiple voltage levels to satisfy transmission constraints. Market participants offer local flexibility intraday in a continuous trading process. This supply is matched with demand from system operators. The market-based redispatch is transparent and technology neutral. Inc-dec gaming is mitigated with features to detect and sanction the behavior. Cost-based redispatch from conventional generation serves as a backstop if additional flexibility is required close to real time. This further mitigates inc-dec gaming by disciplining behavior in the spot market. An advantage of the approach in Europe is that it represents a modest change from the current market and therefore can be implemented sooner and with less risk.
Subjects: 
local flexibility
congestion pricing
market design
electricity markets
electricity regulation
Document Type: 
Working Paper

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