PhD Position, Electricity Market Design in the Energy Transition: Implications for System Security

The power system is changing, largely driven by the energy transition and climate change. The large shares of renewables, both centralized and distributed, are posing new challenges to system operations that are yet to be fully understood. Furthermore, these and other new technologies (heat pumps, electrical vehicles, batteries, power-to-x storage) are expected to have a significant influence on the electricity markets. Moreover, the recent EU regulations are working towards implementing the so-called 70% utilization rule, which is expected to drive electricity trading in Europe. Overall, the aforementioned systemic changes and regulations demand an in-depth investigation using advanced modeling tools and techniques.

The objectives of this PhD research project are to:

1. Assess the impact of the balancing reserves sharing and spatial distribution on the electricity market prices and grid security.
2. Understand the interdependencies between the energy transitions and the future electricity markets.

This thesis aims to answer the following main research questions:

R1: How is the system security affected if the system is organized into regional frequency balancing zones instead of national, independent zones? How will this affect the market prices and the selection of units used for ancillary services?

R2: How will the future electricity market look by 2050? What is the impact of net-zero technologies on electricity prices in Europe and Switzerland? Will low prices impact the investments in renewables and thus hinder the energy transition?

R3: Are current market designs and policies supportive of renewables and demand flexibility provision? Can we identify market designs and compensation plans that will encourage this flexibility while maintaining system integrity?

R4: Are new market designs needed? Should we go beyond the current setup in which the electricity prices are driven by the marginal cost of power generation? What are these designs?

R5: What is the impact of trade limitations on market clearing in the European context? How will this affect Switzerland in 2050, stemming from the cross-border 70% utilization law by the EU? Additionally, how will the market respond if Switzerland forgoes the NTC-based coupling and switches to flow-based coupling?

Additional research questions:

R6: How is the system security affected by the new Mari-Picasso initiative? Is the market more efficient, or is it only profitable for the suppliers?

R7: How is the market/security impacted by the failure of a large nuclear power plant?

This work will be performed using currently developed or in-development tools at RRE. Namely, Euroem, a European electricity market model, and Cascades, a power system security and transmission expansion planning model. Besides improving the interface between them, the PhD student has to upgrade the electricity market model as follows:

1. Cross-market bidding strategies for the suppliers (portfolios), including arbitrage. This includes scheduling “Buy” bids on the futures market and storing/reselling them on the day-ahead market.
2. New portfolio bidding strategies. This can include learning from previous simulation runs to reduce the portfolio's final imbalance.
3. Utilizing real failure/maintenance rates of power plants and investigating the impacts on the market/security. For this purpose, we will use data sourced from the ENTSO-E transparency platform and processed at the RRE. This upgrade will be utilized to answer research question R6.
4. Integration of new technologies and potentially other markets beyond electricity (e.g., gas).

Other modeling improvements are to be expected, particularly related to R3, given the need to test new market requirements. For future scenarios, we will utilize the ENTSO-E projections until 2050.

Job description

Profile

• Fully funded position with competitive salary according to ETH standards
• Access to state-of-the-art computational infrastructure
• Interdisciplinary and international research environment
• Perspectives for career development
• International team culture and team composition