Impact of spatio-temporal correlation of wind production on clearing outcomes of a competitive pool market

By the increase of wind power penetration in electricity markets, a relevant issue is how correlated power production of diverse wind farms may change market clearing outcomes. This paper uses real-world historical wind data to capture spatio-temporal correlation among diverse wind farms. In a simulation framework, we evaluate statistically impact of correlated wind production on clearing outcomes of a competitive pool market, while incorporating inter-temporal constraints of dispatchable generating units to market clearing model. This allows to address how such constraints and associated costs may change the impact of correlated wind production. The market clearing outcomes are statistically evaluated for different levels of spatio-temporal correlation of wind production in the cases with and without inter-temporal constraints. This numerical evaluation is run for different load profiles to examine how technological diversification of dispatchable generating units may change the impact of correlated wind production. An illustrative example and a case study show results and conclusions.