Integrative energy market as system integrator of decentralized generators

Replacement of conventional power plants by RES generation requires future involvement of the new generators also in the fields of power balancing and ancillary services. Nowadays, small and medium-size CHP as decentralized generators with a significant potential for demand driven electricity production do not provide such services in most European countries. In contrary: implemented incentives like flat rate feed-in tariffs promote an arbitrary or continuous production. In the course of the development of Smart Grid technologies, these small, decentralized generators will get incentives to produce electricity on demand and therefore take part in balancing. Furthermore, a rising participation in reserve markets and further system services is likely. The German pilot project eTelligence realized a sustainable energy supply system with a regional energy marketplace as key element. The integrative approach developed within the project has been tested in practice in a field test in 2011. Amongst a larger number of private customers, PV and wind generators and large controllable loads, a number of medium-size CHP became participants of a regional energy market in Cuxhaven selling all electricity to the market while serving the needs of local thermal loads. The project showed that intelligent market participation can replace feed-in tariffs with limited technical effort. The analysis of the field test shows the significance of the marketing and forecasting risk for decentralized generators within the approach. Nevertheless, the results prove the functionality of the marketplace approach to raise the potential benefit for CHP operators as well as the increased system integration as compared to conventional mechanisms for the promotion of distributed CHP.