Impact of natural gas price on electricity price forecasting in Turkish day-ahead market
Poyrazoğlu, Oğuzhan Göktuğ
Proceedings of the 1st IEEE Global Power, Energy and Communication Conference, GPECOM 2019
Institute of Electrical and Electronics Engineers Inc.
435 - 439
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The electricity is a regular commodity that is being sold and bought in a highly transparent and efficient market in Turkey. The market is operated by EXIST and an hourly energy price is formed for every hour in the day-ahead market. In Sept. 2018, EXIST also found a central natural gas market in Turkey which enables a ground for all shareholders in the natural gas industry. This study examines the impact of natural gas prices formed in the market on the electricity price. Different predictors are tested to lower the mean absolute percentage error. Addition of past natural gas price into the forecasting model reduces the error from 15.85% to 14.31 % when the average of the last two weeks' natural gas price is used. This may indicate that the current natural gas price affects the electricity market two weeks later. And the final model also reached the 6.67% error for a Saturday, which is a significantly accurate forecast for a volatile electricity market.
KeywordsElectricity price forecasting
Natural gas price
Multiple linear regression
Published Version (Please cite this version)https://dx.doi.org/10.1109/GPECOM.2019.8778514
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