Analyzing Effects of Solar Variability and System Location on LMP Prices

Abstract

Optimal power flow has been solved to show possible effects of solar variability and location of solar systems on electricity price using the IEEE 30 Bus Test system. Different densities of simulated solar generation plants were used, with higher-density plants exhibiting higher variability of generation. The effects of different solar variability conditions tested in this study were found to be minimal on the absolute reduction in local marginal prices (LMPs), but low-density plant distributions exhibited smaller and less frequent fluctuations in the price. In some cases, solar generation was observed to reduce the LMP to zero, resulting from congestion that limited the export of electricity. We observed that lower-density generation distributions could reduce the frequency of these rapid price fluctuations. The location of solar systems within the grid can also have a significant impact on LMPs. When solar generation is installed at a high demand bus, the LMP typically decreased at both the local and neighboring buses. When the solar systems are installed at a low demand bus, the LMPs were observed to increase or decrease depending on the demand and congestion. This work highlights the importance of the effects of solar system location on LMP.