An official of the Korea Power Exchange (KPX) explains KPX’s 

development of the world’s first automatic bidding system for combined cycle power units.

Korea Power Exchange (KPX) has developed the world’s first automatic bidding system for combined cycle power units. 

Taking its cue from the fact that combined cycle power units’ output varies according to outside temperature changes, KPX launched a research in April 2012 and cranked out the prototype this past July, followed by a successful test operation of the automatic bidding system. 

The automatic bidding system is designed to automatically account for temperature changes from moment to moment, forecast for the neighborhood of each combined cycle power unit, and other factors affecting the power unit’s output, and will be available for the whole bidding process for determining electricity rates. It can also reassess the power supply amounts the power grid can generate from the current time to 38 hours ahead. The system can reduce the bidding errors by reflecting real power supply amounts changing from moment to moment when power companies make bids for supplying electricity. 

Previously, power companies adopted their own separate programs factoring in highest, lowest and average temperatures to assess their electricity supply amounts for bidding to the power grid.

KPX staff members’ manual computing of bid prices was prone to mistakes and was time-consuming. A failure to reflect temperature changes being forecast by the Korea Meteorological Administration in the bidding process was enough to cause the mistakes. 

But the automatic bidding system can crank out more precise information about possible electricity supply amounts automatically, not only reducing the time arising from manual work, but also eradicating typo errors. It can raise the accuracy of bidding outcomes and future reserve capability in hours and days ahead, and employees working at power systems can be assigned more urgent jobs to cope with emergency cases. 

Currently, 17 power companies including Korea Southern Power Co. are participating in biddings by adopting the automatic bidding system. The automatic bidding system was initially limited to 11,663MW, accounting for half of the nation’s combined cycle power units’ power generation capacity of 23,327MW, but it now covers 99 percent or 23,013MW as the convenience and accuracy of the system were secured thanks to collaboration between KPX and participating power companies. 

KPX plans to apply the automatic bidding system to all of the combined cycle power units across the nation in the short-term and expand the system to cover nuclear power units and other power generation facilities in the long term by securing additional related technologies, resulting in raising the accuracy of future reserve forecasts.

A KPX official said the development of the Korean Energy Management System (K-EMS), a total energy management system based on advanced IT for power facility monitoring and control, served as a feat in the nation’s efforts to secure home-grown technologies, and KPX’s first development of the automatic bidding system has proved the nation’s capability as an IT powerhouse.