Market Evolution: Wholesale Electricity Market Design for 21st
Evolution in the National Electricity Market of Singapore
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Transcript of Evolution in the National Electricity Market of Singapore
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Allan H. DawsonChief Executive Officer
Energy Market Company, Singapore
Evolution in the National Electricity Market of Singapore
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Agenda
Reform Milestones Singapore an earlier adopter Why the NEMS? Industry Structure Market Design NEMS Performance Future Evolution
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Reform Milestones 1995
1998
1999
2000
2001
2002
2003
Singapore Power formed, Oct 1995
Wholesale electricity pool commenced, Apr 1998
Government review of electricity industry, Sep 1999
Government decision on further deregulation, Mar 2000
Energy Market Authority formed, Apr 2001
Energy Market Company formed, June 2001
All consumers contestable, 2003 / 2004
New Electricity Market commenced on 1 Jan 2003
PHB Hagler Bailly (later PA Consulting) designs wholesale market, Aug 2000
Planned
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Singapore an early adopterSingapore Electricity Pool Singapore Electricity Pool (SEP) was a cost-
based day-ahead market Designed in 1994, SEP was implemented in
1998 International thinking on market design
progressed significantly between design and implementation
SEP was a useful way of transitioning to a more dynamic and complex market
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Why the NEMS? Designed to promote the supply of
competitively priced electricity Open up the retail market to full competition Allow certain government assets to be
privatized Encourage private investment in Singapore’s
power system infrastructure
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Industry StructureSenoko
Power LtdTuas
Power LtdPower
Seraya LtdNEA SembCorp
Power Grid Ltd
Regulator
SystemOperator
Market Operator(EMC)
Non-Contestable Customers
Contestable Customers
ElectricityRetailers
Power Supply Ltd
ElectricityRetailers• Keppel FELS
Energy Supply Pte LTd
• SembCorp Power Pte Ltd
• Senoko Energy Supply Pte Ltd
• Seraya Energy Pte Ltd
• Tuas Power Supply Pte Ltd
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Industry StructureTENAGA
NASIONAL BERHAD
SENOKO PS
SERAYAPS
JURONG ISLAND
TUASPS
SEMBCORP COGEN
SembCorp Cogen:• Total Installed Capacity = 785 MW• Authorised Generation Capacity = 900 MW • No. of Combined Cycle Plants = 2
Seraya PS: • Total Installed Capacity = 3,100 MW• Authorised Generation Capacity = 3,100 MW •No. of Combined Cycle Plants = 2 • No. of Steam Units = 9• No. of Gas Turbine Units = 4• Total no. of Units = 15
Tuas PS:• Total Capacity Installed = 1,934 MW• Authorised Generation Capacity = 2,670 MW• No. of Combined Cycle Plants = 2• No. of Steam Units = 2• Total no. of Units = 4
Senoko PS:• Total Installed Capacity = 2,655 MW• Authorised Generation Capacity = 3,300 MW• No. of Combined Cycle Plants = 3• No. of Steam Units = 5• No. of Gas Turbines = 2• Total no. of Units = 10
(Some data are extracted from EMA Brochure, Mar 02)
TENAGA NASIONAL BERHAD
SENOKO PS
SERAYAPS
JURONG ISLAND
TUASPS
SEMBCORP COGEN
SembCorp Cogen:• Total Installed Capacity = 785 MW• Authorised Generation Capacity = 900 MW • No. of Combined Cycle Plants = 2
Seraya PS: • Total Installed Capacity = 3,100 MW• Authorised Generation Capacity = 3,100 MW •No. of Combined Cycle Plants = 2 • No. of Steam Units = 9• No. of Gas Turbine Units = 4• Total no. of Units = 15
Tuas PS:• Total Capacity Installed = 1,934 MW• Authorised Generation Capacity = 2,670 MW• No. of Combined Cycle Plants = 2• No. of Steam Units = 2• Total no. of Units = 4
Senoko PS:• Total Installed Capacity = 2,655 MW• Authorised Generation Capacity = 3,300 MW• No. of Combined Cycle Plants = 3• No. of Steam Units = 5• No. of Gas Turbines = 2• Total no. of Units = 10
(Some data are extracted from EMA Brochure, Mar 02)
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Market Design
Generation Companies
RetailCompanies
ContestableCustomers
Non-Contestable Customers
Direct MarketParticipants
SPL - DefaultSupplier
PowerGridPSO
textEMAElectricity Act Market Rules Market Codes
NATIONAL ELECTRICITY MARKET OF SINGAPORE
WholesaleMarket
RetailMarket
RegulatoryFramework
Financial Flows
Energy Flows
Dispatch Information
Legend
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Market Design Real-time market spot market for energy,
regulation and 3 classes of reserve Mandatory participation Cooptimization between energy, reserve and
regulation
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Market Design Ex ante pricing Locational marginal (nodal) prices at 33
injection nodes and 350 off-take nodes Generators receive nodal spot price Customers pay Uniform Singapore Electricity
Price Daily settlement
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NEMS Performance Competitive pressure in the energy, reserve
(most notably) and regulation markets Prices move with fundamentals (oil prices,
generator outages etc) Increasing dominance of gas-fired generation Stakeholders appear satisfied with the first 10
months of operation
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NEMS PerformanceWholesale Energy Prices
0
20
40
60
80
100
120
140
160
180
1-Jan
8-Jan
15-Jan
22-Jan
29-Jan
5-Feb
12-Feb
19-Feb
26-Feb
5-Mar
12-Mar
19-Mar
26-Mar
2-Apr
9-Apr
16-Apr
23-Apr
30-Apr
7-May
14-May
21-May
28-May
4-Jun
11-Jun
18-Jun
25-Jun
2-Jul
9-Jul
16-Jul
23-Jul
30-Jul
Trading date
$/MWhNEM ($/MWh) for 2003 SEP ($/MWh) for 2002
7 Day Mov. Avg. (NEM ($/MWh) for 2003) 7 Day Mov. Avg. (SEP ($/MWh) for 2002)
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NEMS PerformanceWholesale Reserve Prices
0.00
500,000.00
1,000,000.00
1,500,000.00
2,000,000.00
2,500,000.00
3,000,000.00
1-Jan
8-Jan
15-Jan
22-Jan
29-Jan
5-Feb
12-Feb
19-Feb
26-Feb
5-Mar
12-Mar
19-Mar
26-Mar
2-Apr
9-Apr
16-Apr
23-Apr
30-Apr
7-May
14-May
21-May
28-May
4-Jun
11-Jun
18-Jun
25-Jun
2-Jul
9-Jul
16-Jul
23-Jul
30-Jul
($ Mil) SEP Reserve Cost NEM Reserve Cost
7 Day Mov. Avg. (SEP Reserve Cost) 7 Day Mov. Avg. (NEM Reserve Cost)
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NEMS Performance
SEP Generation Composition (Jan to Jul 2002)
38.8%
58.2%
3%
STCCGT
(OTHERS)
Source: Energy Market Company Pte Ltd
NEMS Generation Composition (Jan to Jul 2003)
37.7%
3.0%
59.4%
(OTHERS)
Source: Energy Market Company Pte Ltd
STCCGT
Dominance of gas-fired generation
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Further Evolution
Market rules change panel has supported over 100 rules changes
Most changes were in preparation for market commencement to make the rules workable
EMC administers the rules change panel Critical that the market continues to evolve so
that ‘big bang’ implementations are avoided
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Further Evolution
Key market design issues likely to be considered in the next 2 years Interruptible load participation in the reserve
market Market re-settlement Transmission planning and augmentation Financial transmission rights
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Summary
Singapore has come a long way in the liberalisation of its electricity market
Evolution is important as NEMS performance directly impacts on Singapore’s economy
Singapore will remain at the forefront of market reform
EMC is excited to play a key role in the evolution and success of the NEMS