Optimising CHP through integrated IT solutions

5. July - 2017
Selling electricity early in the day for the evening, buying it back at midday, and then marketing it once more in the afternoon, at a profit, for the evening hours? For many CHP plant operators, complex back-and-forth movements of this kind remind them more of trading on a stock market rather than electricity exchanges.

But Axel Grimm knows that “flexibility can work to your benefit, provided you know how to utilise it for your business and use the right IT solutions”. In Germany, intraday trading increases potential profits by an average of 13–17 euros per megawatt hour compared to the forward market. The Neas Planner, a planning and optimising system developed by Neas Energy, largely automates this process.

Integrated systems optimise electricity trading in Denmark

Denmark, where about 37 per cent of electricity is generated from wind power and over 60 per cent from CHP plants, clearly illustrates that decentralised CHP generation can be highly competitive in a liberalised electricity market. Danish plant operators have been continually developing and fine-tuning specialist IT solutions since the 1990s to ensure that both the power delivery to networks and the financial bottom line are right. Neas Energy has been there from the start.

In recent years, individual operators’ systems have been networked more and more closely with each other via automatic interfaces. Integrated systems retrieve weather reports, manage power plant schedules and market electricity via international exchanges – all according to operator specifications, of course, yet using largely automated processes.

One of the most powerful systems of this kind is run on Neas Energy’s servers in Aalborg, Denmark. From its headquarters, the company controls and markets over 200 CHP plants and renewable energy sources with a total output of approx. 6.6 gigawatt on European electricity exchanges. This makes Neas Energy the market leader in CHP plant management.

Ever faster electricity trading

Driven by the ongoing transition on energy markets and facilitated by digitalisation, the speed of trading has also increased substantially on the German electricity exchange. Yet many CHP operators associate flexibility primarily with balancing energy. However, the price of balancing energy has been falling for years, and regulations for transmission system operators leave little leeway in terms of plant operation. 

This is different in short-term trading, though, where there is more room to move. Also, more and more electricity is traded in ever shorter cycles on the day-ahead and intraday markets. These are actively used not only by electricity generators and energy suppliers who aim to balance their balancing zones, but also by many traders who want to profit from price differences.

However, the rapid pace of short-term markets does not leave enough time to weigh electricity prices against marginal costs and then manually control CHP plants or wind turbines accordingly. Anybody who wants to be a player on these markets needs software that is directly integrated with both analytics tools and power plant control rooms. The Neas Planner has been reliably performing these tasks in Denmark for over ten years and has also been used by CHP operators in Germany since Neas Energy’s internal development department adapted the software to the particularities of the German market.

Dynamic calculation of marginal costs

The Neas Planner calculates the marginal costs of energy production dynamically for each plant and compares these costs 24/7 with prices on the electricity markets. The tool automatically takes into account the flexibilities that a power plant is able to provide at any given time. If the system identifies a business opportunity from this data, the Planner generates an offer for the relevant electricity exchange and directly transmits the resulting change in schedule to the control room. “Our integrated system takes care of essentially everything, from price analysis to electricity trade and power plant control. It even provides for the definition of minimal limits for operating and down times, maximal limits for plant start-ups, start-up costs and many more data”, explains Grimm.

Plant operators are able to track plant parameters at any time from their desktop computers or tablets. The system interface also gives them quick and easy access to the system, for example if they need to change plant control settings. If, for example, more heat is required at any particular time, they can simply enter this via the interface. The Planner then takes this specification into account when calculating schedules and adapts marketing priorities accordingly.

The system additionally frees plant operators from the painstaking task of developing new schedules and operating strategies every time framework conditions on electricity markets undergo a change. Neas Energy’s software developers continually adapt the system in keeping with current developments. As a result, the Planner consistently identifies the optimal solution for marketing CHP electricity. “By having Neas Energy handle electricity marketing through the Planner, CHP plant operators can focus fully on their core business while also benefiting financially from the flexibility of their plants”, says Grimm. 


For further information, please contact

Gülsen Yildirim, Originator

Gülsen Yildirim

Originatorgyi@neasenergy.com+49 211 91324630