Is Locational Marginal Price All You Need for Locational Marginal Emission?
Xuan He, Danny H.K. Tsang, and Yize Chen

TL;DR
This paper explores the relationship between locational marginal price and locational marginal emission, providing a fast, practical method to estimate emissions at different network locations using market data.
Contribution
It establishes a direct connection between LMP and LME, enabling quick emission estimation and revealing congestion-emission interactions in power markets.
Findings
LME can be derived from LMP and demand vectors.
The proposed method reduces computation time significantly.
It can be integrated into existing market clearing processes.
Abstract
Growing concerns over climate change call for improved techniques for estimating and quantifying the greenhouse gas emissions associated with electricity generation and transmission. Among the emission metrics designated for power grids, locational marginal emission (LME) can provide system operators and electricity market participants with valuable information on the emissions associated with electricity usage at various locations in the power network. In this paper, by investigating the operating patterns and physical interpretations of marginal emissions and costs in the security-constrained economic dispatch (SCED) problem, we identify and draw the exact connection between locational marginal price (LMP) and LME. Such interpretation helps instantly derive LME given nodal demand vectors or LMP, and also reveals the interplay between network congestion and nodal emission pattern. Our…
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Taxonomy
TopicsFiscal Policy and Economic Growth
