Power Market Modelling
IPA are leaders in the provision of market modelling and price forecasting to clients both in the UK and Internationally. Working with a wide range of clients over the last 20 years has enabled IPA to develop unrivalled modelling capability, in terms of both the experience of our modelling team and the proprietary software that we have developed.
IPA's extensive knowledge and experience across the energy industry ensures that our modelling accurately represents the evolving power industry. Our capabilities have been widely used by market participants across the industry, to support their asset base development as well as their on-going commercial operations. IPA works for a wide range of industry participants, including suppliers, generators, banks, lawyers, landowners, governments and regulators.
Power Market Modelling - ECLIPSE
IPA have embedded their extensive knowledge of the wider energy industry into a proprietary macro-economic model - ECLIPSE (Emissions Constraints and Policy Interactions in Power System Economics). It uses a Mathematical Programming approach to modelling the fundamental economics of different power markets, allowing for the interaction with political, environmental and regulatory developments. This includes modelling the interactions of renewables, emissions, carbon and other economic drivers.
It also can perform as a despatch simulation model using a mathematical programming formulation to despatch plant on a short term basis within system constraints and limits. Costs and constraints of ramp up and the needs of spinning reserve can be addressed.
ECLIPSE Key Features
Despatch
Despatch of all major power stations down to an hourly granularity. Accurate modeling of different generation technologies, including thermal plant, plant co-fired with biomass, hydro and other renewable schemes, and modeling of commercial constraints associated with off-take and fuel contracts. ECLIPSE utilizes detailed information on fixed and variable costs, technical constraints and efficiencies for each power station.
Carbon Pricing
The European Carbon Trading Scheme (EU ETS) has a significant effect on generator economics. ECLIPSE models both the impact of carbon pricing on station running and power prices as well as the impact of free allocations on station profitability. ECLIPSE utilizes IPA’s carbon price modeling to inform assumptions about future carbon market prices and free allocations at installation level.
Emission Limits
Power plants are subject to emissions restrictions under the LCPD and IPPC which limit the volume and rate of emission of certain pollutants. ECLIPSE represents these emissions limits, and can simulate their impact on plant economics and power pricing. The dispatch of coal is optimized over the year to ensure maximized profitability over restricted running hours.
Renewables Obligation (RO)
The Renewables Obligation is the main renewables support mechanism in Great Britain. ECLIPSE provides detailed forecasts of ROC prices and represents the complexities of the ROC price mechanism. ECLIPSE models the non-linear price curve and the interaction with the dispatch of controllable renewables such as biomass and co-fired coal. ECLIPSE captures RO restrictions (such as applied to co-firing), technology banding, headroom, and the proposed ROC over-supply price mechanism.
Capacity
ECLIPSE models the economically optimal development of capacity over the forecast horizon. It calculates optimal capacity build rates over the range of generation technologies dependent upon capital and operating costs, fuel, carbon and ROC prices. Build rates are constrained by assumptions on the ability of the industry to develop, finance, build and connect generation. Renewable technologies are also subject to economic resource constraints. Capacity costs are subject to cost curves, reflecting reducing capacity costs for nascent technologies, as well as the quality of the available resource for renewable generation.
