Application of Electricity Management Strategies for Lower Balancing Costs

Electricity is a commodity traded from the market through various products, but this level of accessibility represents a great opportunity and challenge for energy suppliers. Storing electricity in large quantities is not yet possible, meaning that the delivery to the customers needs to happen at the time of production. Energy suppliers must have a reliable strategy to buy or sell on the power market. The strategy efficiency determines if the supplier can optimally balance the portfolio, with the lowest impact on the overall costs. Energy imbalance is the difference between energy forecast and real consumption/ generation per portfolio. The cost of imbalances can negatively impact the margin of a portfolio that aggregates production, consumption, and trading. In this paper, the authors present complex situations for an energy supplier who needs to balance a portfolio consisting of consumption (industrial and commercial consumers), generation (photovoltaic and hydropower plants), and trading. The goal is to minimize market risk through excesses and shortfalls as much as possible and to reduce balancing energy expenses. Each market participant operating in the electricity market is obliged to have a contract with a BRP (Balancing responsible parties) or be one. The greater the number of participants in a group, the lower their balancing energy expenses, and keeping track of fluctuations both within a balanced group and with other balance groups can reduce costs.