Appendix A - PROPHET MARKET SIMULATION TOOL PROPHET, commercially available software, is an advanced software application developed by IES which is a full and comprehensive market simulation platform that can simulate the operation of electricity markets and competitive electricity market behaviour. The application tool can be used to model various complex scenarios and detailed market simulations and is used by a variety of stakeholders such as market operators, generators, network companies and trading desks. It has been under continual development for over 20 years including development priorities arising from customer requirements. PROPHET has been designed to be generic in many aspects and can be adapted to any market that has a spot market based on generators making offers and a market clearing mechanism that can be reasonably approximated by a linear programming model. As such, it is capable of simulating various electricity markets with different arrangements, such as the NEM’s gross pool and co-optimized energy and ancillary services markets. Other arrangements include but are not limited to: zz
Nodal or zonal pricing, transmission constraints (dynamically determined based on power system conditions if required) and losses;
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Simulation of full security-constrained dispatch optimization;
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Simulation of ancillary service markets;
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Modelling transmission networks including AC lines, HVDC links and also the associated power importer/exporter arrangements.
A.1 PROPHET MODELLING FLOWS Figure 38 provides a summary of the two main PROPHET modules, its inputs, modelling flows and example outputs: zz
[Planning]: This is designed to solve intertemporal constraints and decisions including, but not limited to, new entrant capacity, optimal dispatch for an energy limited plant such as reservoir-based hydro, and carbon prices for emissions limits. This information is fed into the simulation module for detailed market simulations.
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[Simulation]: This replicates the various dispatch engines of competitive electricity markets around the world (under different market structures and arrangements) on a least-cost basis respecting physical and operating constraints and any network constraints applied. In addition, the simulation module is capable of simulating competitive generator behaviours such as portfolio bidding, market power gaming and bidding based on contracted positions.
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