Spot trading in the electricity market will eventually become the mainstay of the future market, and the existing scheduling mechanism cannot meet the pricing of spot and short-term data analysis and processing of small area transmission and distribution networks. In the traditional concept of smart grid, the controller of the power system is the grid, which controls the market electricity price. The power generation side has no say in the quantity and pricing of production, and users have no bargaining power in the process of use. In spot trading, electricity sales companies can conduct big data analysis on smart meter data from industrial parks, large users, and regional industrial and commercial property companies, as well as real-time spot bidding systems, which can reverse the passive situation of power generation and electricity users.
Electricity spot trading
In the current electricity market in China, medium and long-term trading occupies the dominant position, while spot trading is only carried out in pilot areas such as Guangdong, Zhejiang, and Fujian. However, in the truly mature electricity market, spot goods occupy a core position.
The PJM electricity market in the United States is currently the most well functioning electricity trading market in the world. The PJM electricity market adopts a single price based on node marginal specifications during the day, and the price change mechanism is jointly influenced by the supply and demand side and node capacity; Simultaneously maintaining the stability of the power grid through synchronous backup in the frequency modulation market.
The PJM market uses real-time load forecasting within 15 minutes and joint adjustment of current time nodes. After big data analysis and processing, it follows the supply and demand situation to form node electricity prices, and sends ACG instructions that meet the real market demand to the power generation side. The power generation side then issues intelligent load instructions based on the unit's performance within 15 minutes. Due to the update of power generation equipment in the PJM market, more coal-fired power plants have been replaced with efficient energy sources such as gas, wind, and solar photovoltaics, especially gas-fired power plants, which have sufficient load regulation capabilities to meet the significant fluctuations in node loads and primary frequency regulation needs. And in the fluctuations, value-added services and changes in node electricity prices have also emerged. It can be said that the pricing power is basically handed over to both the supply and demand sides of the market, and the hard boundary only affects the cross-sectional capacity of the transmission and distribution network.
Except for Beijing, all other provinces in China rely on coal-fired power plants as the main source of electricity generation. The major problem with coal-fired power plants is that they have a high delay in load changes, which cannot meet the regulation of large fluctuations and to some extent limits the pricing power of the electricity generation side in the spot market.
A good way to reduce the fluctuation of power grid load in the face of the current major problems in our country is to conduct big data analysis of smart grids and combine it with user electricity analysis to negotiate in the market. In the past, smart grid analysis was only provided to power grid dispatch to maintain grid stability, and data was also disclosed to power sales companies responsible for representing regional customers, large users, and large property companies. Power sales companies provided optimal quotes on the electricity consumption side through data, combined with economically efficient power generation schemes on the power generation side to achieve social welfare maximization.
Big data analysis based on smart meters
Smart meters are the fundamental components of smart grids, but traditional smart grids focus more on grid dispatching to maintain system stability, losing their role in optimizing energy utilization.
At present, corresponding to the mid to long term trading situation, some power sales companies have started to communicate with proxy customers to install intelligent meters, and the data is directly fed back to the power sales company's data collection system. The power sales company conducts data statistics on customers' electricity habits, characteristics, and peak and valley electricity loads. As the basis for short-term bidding, listing and other transactions, the predictive ability of this data is far from meeting the market's requirements for pricing.
Only through the comprehensive collection of basic information from smart meters, comparative analysis of historical and real-time data, fuzzy analysis of industries, analysis of environmental and climate impact factors, analysis of human policy impact factors, analysis of economic cycle data, combined with intelligent big data analysis from multiple dimensions, can the role of smart meters be fully realized.
Electricity Market and Market Economy
No matter which country's electricity market is, it cannot be market-oriented. The electricity industry is related to the lifeline of the national economy, and the power grid is very fragile in a complex environment. There must be a visible hand to maintain the normal operation of the entire power grid system through reasonable scheduling and arrangement. Under the intervention of technological means and national policies, there will always be a certain tendency in the market. When it tends towards users, power generation companies will be greatly affected, with heavy burdens and unable to create sufficient profits to update and replace equipment, and unable to serve society in a more efficient and energy-saving way; When leaning towards power generation companies, it can also lead to a burden on electricity users, increased industrial costs, and an impact on people's lives.
The purpose of China's electricity market reform is to reduce the manipulation of this "visible hand" and give more pricing power over the electricity market to the market. The purpose of opening the electricity trading center is to make this market active and free. With the development of technology, it has become increasingly realistic to turn visible hands into invisible hands. Through basic smart meters and big data analysis, it has become possible for the electricity market to move towards further marketization.