Jeju Renewable Energy Bidding Market

The Jeju Renewable Energy Bidding System is a new electricity market operation method introduced in Jeju to ensure the efficient operation of renewable energy and maintain grid stability. This system is designed for renewable energy producers to participate in the day-ahead and real-time markets, submitting bids for power generation volume and prices. Its aim is to manage the variability of renewable energy, mitigate curtailment issues, and maintain a balance in power supply and demand. In the market perspective, this system is expected to alleviate curtailment issues caused by the variability of renewable energy, encourage market participation by renewable energy producers, and enhance grid stability and efficiency. Most market and policy experts are expecting this bidding market structure to expand nation-wide in the coming years, providing the bedrock for renewable energy to be the most prominent energy supplier in the domestic electricity market.

Dual Market Structure

Renewable energy producers participate in both the day-ahead market and the real-time market. In the day-ahead market, they forecast and bid on the next day’s power generation, while in the real-time market, they make additional bids to respond to actual generation fluctuations.

Mandatory Participation

Wind and solar power generators with a capacity exceeding 3 MW are required to participate in the system. Those with capacities between 1 MW and 3 MW, as well as Virtual Power Plant (VPP) aggregators, can choose whether to participate.

Settlement Mechanism

Participants are compensated based on both day-ahead market prices (SMP, System Marginal Price) and real-time market prices. Specifically, the day-ahead bid volume is settled at the day-ahead SMP & the difference between forecasted and actual generation is settled at the real-time SMP. This system is expected to alleviate curtailment issues caused by the variability of renewable energy, encourage market participation by renewable energy producers, and enhance grid stability and efficiency.