A stochastic approach to market barriers set by the power grid

Bottlenecks in the electricity grid limit the functionality of the electricity markets.

They can lead to high prices for consumption, make it unattractive to build renewable electricity production, and can even put a stop to new connections.

The amount of power that the network can handle, before a bottleneck occurs, is based on so-called deterministic methods, where there is a sharp border between what is possible and what is not.

The alternative, which will be developed in this project, is to quantify the risks that the market in combination with unforeseen component failure and forecast errors will lead to overload, major supply interruptions, etc.

Information about the risk enables an assessment from case to case (e.g. day-ahead, for each hour) whether it is worth taking the risks, considering the risks of limiting the market.

There will still be bottlenecks, but they will no longer impose unnecessary restrictions on the electricity market with serious consequences.