Alice has previously demonstrated how to use vSPD-online to test the sensitivity of wholesale energy prices to changes in demand. On the evening of 2 June 2016, wholesale energy prices jumped up to about $4,000 - $5,000 per MWh. Using vSPD-online, we can examine how much lower demand would have to have been for this price spike not to occur.
Three jobs were run using vSPD-online on 3 June 2016 and can be seen in the vSPD-online dashboard. One job just solved trading periods 35 to 40 from 2 June 2016 without using an override. This becomes the base case. Two additional jobs were run as scenarios to compare against the base case: one of these decreased demand at all nodes in New Zealand by 0.5% for trading periods 35 to 40 and the other decreased demand by 1%.
The results were downloaded and the reference prices were extracted from the file containing island results by trading period. The results of these vSPD-online jobs for each island for the two periods in which prices spiked on 2 June are summarised in the following table.
There were no doubt more factors behind these price spikes than just demand. Nevertheless, the results above show that, all else being equal, a relatively small decrease in demand would've lowered prices by a huge margin.
These results highlight the benefit of having consumers reduce demand in times of high price.