1. APEx Conference October 12-14, Medellin Panel 1 – Value of Markets and Future Development Presenter:
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2. Value of Markets and Future Development Table of contents
Glance of trends in gas and electricity topics of US
Gas and electricity markets coordination in progress
Development efforts - salient samples of solutions in progress
Managing the high gas fired generation in the energy mix
Reducing gas dependency of energy mix

3. Significant acceleration of natural gas and renewables ===>>
US EIA Outlook 2016 – Clean Power Plans accelerate the shift in energy mix
Significant acceleration of natural gas and renewables
===>>
Implication: Acceleration of gas-electricity operational coordination, grid operators’ reserve management techniques, gas-electricity couplings modeled
Source: Annual Energy Outlook September

4. Shale Gas Era – Gas and Electricity Prices Outlook in U.S.
[1]
Source: Annual Energy Outlook September

5. LNG Outlook Low oil price weakens LNG success
Low cost of transportation assists LNG success
New and widened Panama Canal – June 2016
Source:
Source: Panama Canal June 22, 2016

6. Gas and Electricity Dependencies to Bear in Mind…
2011 Southwestern Outages and 2014 Polar Vortex illustrated the vulnerabilities of gas
electricity mix during harsh winter
Fact: largest fuel for US electricity generation is gas, since the shale gas expansion
Natural gas demands for heating and electricity peaking together in winter
Reserves and capacities from gas fired generations in grid dispatch were not realizable
Brown outs: Compressors of pipelines are electricity operated
Harsh winter freeze causing gas flow issues and black start generators readiness problems
Regions and plants at the end of the pipe line are vulnerable in case of high upstream usage 6

7. Assessment of Capacity of Available Gas and Gas Fired Generation
Examples of Modeling in progress for generation dispatch problems:
Gas network and constraints
Modeling of pipe lines and storages for capacity determination
Gas contingencies
US relies on gas production more than storage.
Asia and Europe plan much higher percent of gas in storage due to scarcity
Source:

8. US Grid Operators Gas-Electric Coordination – MISO Example
Midwest Independent System Operator - Day Ahead Market awards posted ahead of deadline of timely gas nominations
PJM plans1:30 pm Day Ahead awards, before the 2 pm gas deadline for timely nomination cycle
FERC 787: Real time sharing of operational and non-public information between the grid and gas operators and interstate pipelines
Source: 8

9. Siemens Spectrum Power™ SCUC Example
Security Constrained Unit Commitment
Several gas types (firm and interruptible)
Layers of gas constraints (Florida Power and Light Example)
Gas burn Limits as daily and hourly constraints for
- Unit, Plant, Pipeline and Area layers
Fuel mix optimization (dual fuel plants w/ gas and oil mix) - hourly settings of optimal ratios.
LNG – Gas-Oil mix is next.
In regions of high CC plant usage, exhaustive modeling and optimization of multi-stage configurations in look-ahead formulation yields large $ savings in cost of operation

10. Managing Ramping Challenges with Gas Fired Generation in California
Siemens Spectrum Power™ SCUC Solutions in
CAISO
Exhaustive CC plant configuration commitment and
dispatch in DA and RT– high cost savings
Pay for performance - fast gas turbines and
storages in regulation – reliability increase and
incenting fast generators
Flexible Ramp Constraints – reliability increase
Flex Ramp - AS Product in CAISO (October 2016)
– incenting fast gas fired generators and storages
Ramp as a function and Ramp Sharing (En, AS)
modeling for a realistic and achievable dispatch
Daily Net Load (Load-Variable Gen.) Curve in California
Source:

11. Optimizing and achieving lower gas infrastructure cost in Europe
Integrated Approach of gas-based fleets (joint optimization of gas and power operations and use power system flexibility => significantly lower costs
Standard Approach of gas-based fleets operation
Extending this analogy to US:
DERs and DR offer the flexibility and lower cost alternative to Gas fired generation
Source: Benefits of Integrating Regions in Europe, G. Tarel, Artelys Optimization Solutions , FERC conference on Markets Software – June 2016

12. DERP Initiative of CAISO – Limits Gas Fired Generation Use
Distributed Energy Resource Provider initiative of CAISO: DER Provider can be a scheduling coordinator to CAISO or provide services thru’ an SC DERP’s bundle the roof-tops, storages, DR and offer to wholesale Initiative will limit the gas fired generation dispatch

13. Solutions in the (gas) pipeline
Managing the high gas – electricity dependency
Just as we modeled physical system (network) constraints in US Markets => Gas network model and gas contingency constraints are short term needs – already available
Slow moving - gas flow dynamics, gas storages, locational aspects or prices being considered in the gas industry optimization problem (FERC conference papers of Market Software, June 2016)
Co-optimization formulation for gas-electricity with locational aspects represented in commitment/dispatch problems
Reducing the gas – electricity dependency
Initiatives of 1325 MW of storages and 12,000 MW of DER’s added by 2020 – California mandates reduce gas fired generation needs
Initiatives of DERP in California, and REV in New York are gearing the industry towards lesser dependency on Gas as fuel and to limit the cost of infrastructure 13

14. Thank you for your attention! Questions/Answers…
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15. Contact
Sankaran Rajagopal, Ph.D. in E.E. Director, Energy Market Management Systems
Siemens Digital Grid SWS
10900 Wayzata Boulevard, Suite Minnetonka, MN 55305
Phone:
Ravi Pradhan Vice President, Technology Siemens Software and Services
Phone: