Launching an Energy Trading Platform, Jointly Advancing Towards Energy Transition
Taiwan's power system is a self-sufficient independent grid. As energy transformation trends develop and the government energy policies are implemented, it is necessary to ensure the safety and stability of the grid while accommodating large numbers of renewable grid- connections and managing the intermittency and instability that accompanies renewables such as solar, wind, and tidal energy.
Taipower officially launched Taiwan's first "Energy Trading Platform" in 2021. The platform introduced private generation resources into the market and enhanced the added value of resources through four main participants trading in two major markets. Taipower invited the private sector to jointly participate in energy transition. It will gradually shift the grid management and power resources from centralization to distribution, thus creating new opportunities for the energy services industry.
Research and Planning
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Taipower conducted research on countries with relatively mature electricity trading systems to gain insight into liberalized electricity market structures. Taipower has also conducted internal electricity auction trials since 2014. In 2019, the Company launched an "Interim Mechanism for Non-traditional Units to Participate in Real-time Reserve Ancillary Services." In 2020, Taipower successfully developed an "Automatic Frequency Control (AFC) Energy Storage System" that established a viable model for distributed power participation in the trading system. Through trial and error, Taipower has gradually developed an energy trading system that is suitable for Taiwan. |
Enabling the Day-ahead Ancillary Service Market for the first time
| Purpose | Response Time | Duration | |
| Frequency Responsiveness Reserve Ancillary Service | Follows system load volatility, and revises systemfrequency deviation through real- time power adjustments to maintain system stability | In 1-10 seconds | Over 15 minutes |
| Real-time Reserve Ancillary Service |
Primarily a security capacity standby that responds to occasional events such as unit jumps, and serious imbalances of system supply and demand |
In 10 minutes | Over 1 hour |
| Supplementary Reserve Ancillary Service |
Supplies additional power to meet demand required by the system in response to load surges caused by supply and demand forecast errors | In 30 minutes | Over 2 hours |
Day-ahead Ancillary Services Market
The "Day-ahead" Market is so named because it facilitates auctions for projected demand on the day before dispatching. "Ancillary Services" consist of services required to maintain the safe and stable operation of the system or to restore the system to regular service after an outage. Each day, the Energy Trading Platform will announce the projected demand for three auxiliary services to be traded.
Private operators can participate in the market as long as they can provide dispatched power capacity greater than 1MW. They may also gather small-scale producers who have not reached the threshold through an "aggregator" that acts as an agent to consolidate power producers. Taipower will make use of these private resources to supplement the existing power capacity and convert the actual dispatched power capacity into service fees that are settled with operators monthly.
Outlook
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Following the launch of the Day- ahead Ancillary Services Market, Taipower actively developed and launched a second trading market, the "Capacity Reserve Market," in January 2022. The platform acts as a "matching mechanism" between supply and demand of the capacity reserve. The market represents a move towards a complete structure and set of services for the Energy Trading Platform. In the face of the 2025 energy transition goal, Taipower will continue to build and improve the electricity market and expects more industry players to join in participating in the future of Taiwan's brand-new electricity industry. |