The Southern African Power Pool (SAPP) was created through a Southern African Development Community (SADC) countries’ treaty with the aim of providing reliable and economical electricity to supply the consumers of each of the SAPP members.
Regional energy trade has been a high priority for the SADC member countries. Since the disparities in energy resources and consumption provided a strong rationale for the integration of the sector and for the promotion of competitive regional energy trade, SAPP established a market for short-term energy (STEM). During the operation of the STEM market, hourly contracts were matched on a bilateral basis, but it became clear to SAPP that the STEM market did not create the marketplace required for short term trading of power.
A mechanism was required to enable daily trading of electricity between SADC countries, as well as administrate and settle complex electricity trading agreements.
In collaboration with Nord Pool Consulting, we implemented a Day-Ahead Market (DAM) system for SAPP in 2006/7, which included the Sapri IT system, provided by Nord Pool, to operate the market. It was the first implementation outside Europe and the world’s largest power exchange (in geographic terms 9.3 million square kilometres). The DAM system replaced the bilateral STEM market and some of the bilateral trade in the region.
The DAM runs in parallel with the Bilateral Market, with the Bilateral Market supporting participants’ requirements for base load in the total portfolio, and the Day-Ahead Market shorter term variation. The DAM client interface provides the Sapri system with trading data, bilateral contracts and transmission capacities specific to SAPP. It also provides aftertrade market and settlement results, reporting and invoices, and long term data storage.
The system consists of modules for reporting, access control and user interfaces for trading, as well as application modules for capturing data, logging of data entered, reporting on data captured and an interface to submit and receive data.
The system is capable of automatic application configuration. All trading parameters are maintained via the market operator interfaces, and all additions and changes are automatically distributed to the client interfaces. Participant client configuration occurs automatically using messages that contain parameters for data input as well as configurations for users’ access.
The web client for trading consists of a web application with interfaces for submitting transmission capacities, bilateral contract schedules, hourly bids and block bids, and contains an e-mail interface for submitting trading data.
In 2014/15 we developed a new trading platform for SAPP, which included a new Physical Forwards Market and a new Intra-Day Market.
The Day-Ahead Market system allows participants to sell non-committed generation capacity (and in future possibly demand-side resources) on a day-ahead basis, and contributes to the regional optimisation of energy resources. Significant savings on time and effort, as well as a dramatic increase in the reliability of the settlement process, have been realised.
For SAPP the Day-Ahead Market system is a sustainable asset, playing an important role in the management and operation of the power supply infrastructure in Southern Africa.