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The electrical power market

Energy prices on the Nord Pool power exchange are calculated on a daily basis for every operating hour in a variety of sectors.

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Those responsible for systems in the Nordic region work closely together using the Nordel arrangement, and there exists a shared market for balance services within a given operating hour.

A variety of models have been developed for this market based on physical descriptions of production, transmission and consumption, as well as costs. The models make use of expertise both in production planning and in the operation of thermal power stations, wind farms, the transmission system and consumption patterns.

In a well-functioning electricity market, the production and utilisation of electricity is optimised. It is thus possible to analyse such markets using optimisation models. The best-known of which is the Grid Simulation Model (Samkjøringsmodellen) developed by SINTEF. This model identifies an optimal hydroelectric power strategy based on stochastic and dynamic programming.

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