A competitive framework to regulate day-ahead wind power predictions for operational planning in electricity markets

Wind energy, being an efficient and economically attractive Renewable Energy Source, attracts more and more investments as the electrical grids evolve into smarter grids. However, the stochastic nature of wind raises a lot of challenges for the system actors and planners. The different system actors (e.g. system operators, producers, consumers...), which are usually characterized by contradicting interests, use their own prediction models for taking into account the uncertainty of wind. The need for a framework that defines their interactions regarding prediction models is therefore mandatory, in order to allow a safe operation of the grid while ensuring a competitive framework for each of the stakeholders. In the present paper, a method for producing uncertainty forecasts is first presented. The uncertainty forecasts along with price scenarios for the day-ahead are used to investigate the potential conflicts of interests, with respect to the power forecast, between the major system actors (i.e. producers and the transmission/distribution system operator). The findings of this work indicate that the producer can maximize his income by inserting a bias in his prediction models which is in conflict with the System Operator's security constraints. In order to face this issue with a compromised solution, a competitive framework for the use of wind power predictions is suggested, according to which the interests of both actors will be satisfied.