market premium model for biogas plants

clens.eu

Market premium model for biogas plants Jonas Zingerle

Paris, 13/10/2016

clens.eu clens.eu

Short presentation of Clean Energy Sourcing

Clean Energy Sourcing Group: Company and Products

2

clens.eu

Green Energy Supply, Direct Marketing, and Virtual Power Plant

We are one of the leading green power suppliers in Germany

■Over 8 TWh power sales to industrial and commercial customers

■Over 3.900 MW in portfolio management of renewable energy and combined heat and power plants (CHP)

■One of the leading virtual power plants ■Prequalified supplier on the reserve power market (SRL & MRL) in

Germany and Austria ■Flexible management of decentral power plants, power consumers

and storage

■Our own 24/7 trading & operations cockpit ■Market access to all important trading platforms in Europe: EEX,

EPEX Spot, EXAA, APX etc. ■Trading desk and 24/7 control room ■Analysis, prognosis, modelling

■More than 70 employees at our locations in Leipzig, Frankfurt and Vienna

Short presentation of Clean Energy Sourcing

The Trading & Operations Cockpit runs 24/7

3


clens.eu

CLENS groups its three major business lines around the IT-enhanced Trading & Operations Cockpit (TOC)

4

■Power-supply of end- customers

■Strong in industry and commerce

■Buy and resell power from distributed power plants

■Mainly through market premium model in Germany

■Price-oriented dispatching and balance power service for flexible power plants, consumption and storage assets

Loadmanagement

Trading &

Operation

Trading &

Operations

Cockpit

CLENS company profile

clens.eu clens.eu

Market premium model – how does it work?

5

clens.eu

The Market Premium Model allows to directly sell power of all types of renewable enrgy plants

6

Basic principle: Operator no longer feeds production into the grid based on fixed feed-in tariffs as guaranteed by EEG, but sells it (usually via a direct marketing service provider) directly on power markets

As sales revenues attainable in this way are lower than the plant-specific guaranteed EEG feed-in tariffs, the difference is compensated for by the so called market premium

Market premium = EEG feed-in tariff - average market price + management premium

The management premium sets an incentive for plant operators to switch to the Market Premium Model Market price for wind and PV plants is calculated as the technology-specific, volume-weighted monthly average price on the electricity exchange (EPEX Spot)

Difference between

EEG feed-in tariff and

average

market price

Technology-specific

market price

EEG feed-in

tariff

Management premium (MP)

Market premium

clens.eu

For each technology monthly market values are calculated based on hourly EPEX-Spot day-ahead market prices

7

Management premium differs for technologies:

• Fluctuating technologies (Wind/PV): 4€/MWh

• Steady technologies (Biogas/Hydro): 2€/MWh

clens.eu

What does that mean for the daily business of a direct marketing service provider?

• As balancing responsible party, direct marketer need to deliver binding ¼- h generation schedules

• high quality of forecast is crucial

• Scheduled volumes are generally sold day-ahead on spot markets (EPEX)

• deviations from scheduled production are settled

• Imbalance prices are relatively volatile and can be positive or negative => risks!

• predictibility of a power plants production is importat part of pricing models

8

clens.eu clens.eu

Ancillary services

Reserve power market

Wholesale-market

Power Exchange

Spot market Futures +

Options market

Over-the-counter (OTC)

Spotmarkt

Continuous Trading

Futures

Forwards, Options

Market places - overview

Day-Ahead-Auction

Intraday

Auction + Continuous Trading

Primary reserve

Secondary reserve

Tertiary reserve

Financial level Physical level

clens.eu clens.eu


11

Market results

Development of day-ahead spot market prices

21,54 €

clens.eu

Merit Order Modell

Marginal

costs/supply

lignite

hardcoal

gas

oil

nuclear

Leistung [GW]

Price

[€/MWh] demand

Price P1

Margin

Price P2

Renewables

Seite 13

Share of fluctuating

renewables (wind+pv) get

bigger

Value of base load will

decrease

Demand for flexibility is

growing

Price-spreads will increase

and occur more often

red: demand (2010)

green: generation wind & solar

Cap

acit

y in

stal

led

, GW

]

20 % share RES

40 % share RES

80 % share RES

source: Prof. Dr. Stadler/ Westfalen Wind GmbH

What is coming next?

clens.eu clens.eu

CLENS‘ holistic optimization approach provides best results across all market places.

14

Secondary

reserve

Tertiary

reserve

Spot

(day ahead) Intraday

Placement Wednesday Workday:

Until 10 AM

Workday:

Until noon

Up to 45Min before

fulfilment

Provision-/

supply-period

Week after:

Monday till sunday

Day after until next

workday

Day after until next

workday Same day

Product length Peak & off-peak 6 x 4 hours 24 x 1 hour 24 x 1 hour

96 x ¼ hour

Order of bidding

Order of forecast

Granularity of products Binding commitment

Early, binding scheduling

vs.

Short-term flexibility

clens.eu clens.eu

Optimization outcome last week

15

=> Additional value of optimized schedule to average market value 10 €/MWh

=> Additional value of optimized schedule to average market value 1,50 €/MWh

clens.eu clens.eu

Market environment changes –

flexibility wins!

16

clens.eu

….Questions?

Jonas Zingerle Business Development

Katharinenstraße 6

04109 Leipzig

+49 341 30 86 06-276

[email protected]

17

clens.eu

Produktsegment Ausschreibung Mind.-Angebot Aktivierung Zeitscheiben Vergütung

Primärregelleistung Wöchentlich 1 MW <30 Sekunden

vollautomatisch 1/Woche Leistungspreis

Sekundärregelleistung Wöchentlich 5 MW < 5 Minuten

vollautomatisch Peak & Off-Peak

Leistungspreis &

Arbeitspreis

Minutenreserve-

leistung Täglich 5 MW

<15 Minuten

teilautomatisiert 6x4h/Tag

Leistungspreis &

Arbeitspreis

Reihenfolge der Aktivierung

Primär-

regelung

Sekundär-

regelung

Minuten-

reserve

5 s 30 s 15 min 1 h 5 min

…

Regelenergiearten

clens.eu clens.eu

-

10

20

30

40

50

60

1 5 9 13 17 21 25 29 33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93

€/M

Wh

EPEX 15 EPEX DA

Entwicklung der Spotmärkte

Stundenauktion (EPEX DA) vs. 1/4-Stundenauktion (EPEX15 )

Volatility on ID-Market (continuous)

clens.eu clens.eu

Quelle: Energy Brainpool

Baseload

Prognose Energy Brainpool: Volatility increases and flexibility wins!

market premium model for biogas plants

Documents