Value of forecasting
| WS: | WP1 Weather | WP2 Power | WP3 Applications | Deliverable | #, Due | Collaboration |
| Value of forecasting (WP3) | X | Paper | D 3.4 / M33 |
Without value for the end users, there wouldn’t be a market for forecasts. The incremental value of increase accuracy is though much harder to assess. The value proposition is though quite country and market specific. Therefore, we will analyse different market structures w.r.t. to the regulatory framework, the amount of renewable power in the system (i.e. whether it is a price taker or price maker), the possibilities for gaming and the implications of gaming for the system.
D.3.4: Documentation and communication of the assessment of the value of probabilistic forecasts in selected markets, bidding strategies (M24)
Workstream Outcomes
In the following, some selected outcomes from the workstream are presented. Not all of them are purely wind, Some are also focusing on solar or both wind and solar forecasting tools. All these finding are equally interesting from a “windy” perspective , and should be looked upon as important milestones for renewable energy integration into the system operations, rather than on the choice of energy source chosen as focus point.
Quantifying the value of probabilistic forecasting for power system operation planning
The DOE funded project Operational Probabilistic Tools for Solar Uncertainty (OPTSUN) developed and demonstrated new methods to operate power systems with high penetration of solar power. These methods use probabilistic solar power forecasts, which capture the uncertainty inherent in solar power output, to support decision making in utility operations.
The highlights from the project:
- Development of enhanced probabilistic power forecasts for utility-scale and behind-the-meter (BTM) solar
- Identification of advanced methods for managing uncertainty in utility operations
- Validattion of methods through detailed simulation of power system operations using data from utility regions across the United States
- Demonstration of a scheduling management platform to integrate probabilistic forecasts and scheduling decisions, with code released as open-soucrce
The project’s overview, final report, access to the open-source software and contact details to the researcher can be found here. The journal publication (“Quantifying the value of probabilistic forecasting for power system operation planning”) following the project can be seen here. or in our publication list for 2023
Quantifying the value of forecasting for energy islands
A stochastic two-stage optimisation model with rolling horizon has been developed. The model is suited for simulating the operation of a multi-carrier energy hub consisting of wind power, electrolyser (H2 generation) and H2 storage. It is assumed that the hub is operating in the electricity market framework (day-ahead spot market and balancing market) and must deliver a certain amount of H2 on a daily basis. Wind forecasts form part of the uncertainty on an operational basis.
Coupling wind turbines with flexible demand entities, such as electrolysers, create opportunities of behind the meter balancing. i.e. adjusting the operation of the flexible asset to its optimal value and thereby achieve economic benefits. Additionally, new revenue streams can also emerge, such as the participation of the demand units in the TSO managed regulating power markets. Also, the use of probabilistic forecasts is described for a specific case study.
See presentation here: The value of forecasting for energy islands, Anne Sofie Skak-Iversen og Peter Børre Eriksen, Ea Energianalyse
Full report for download: Skak-Iversen, A.S., Eleftheriou, D., Eriksen, P.B., Wind forecasts for operation of energy hubs with PtX, IEA Wind Task 51 Danish Consortium Project Report, Dec. 2025.
Other relevant Publications on the Value of Forecasting:
Forecasting: theory and practice by Petropolous et al. 2025 – an encyclopedic presentation that offers a point of reference for the rich work that has been undertaken over the last decades, with some key insights for the future of forecasting theory and practice. (Link to publication: https://arxiv.org/abs/2012.03854 , DOI: 10.1016/j.ijforecast.2021.11.001)
The hybrid renewable energy forecasting and trading competition 2024 -Browell et al. 2025 – The Hybrid Energy Forecasting and Trading Competition challenged participants to forecast and trade electricity generation from a 3.6 GW portfolio of wind and solar farms in Great Britain for three months in 2024. The competition mimicked operational practice, with participants required to submit genuine forecasts and market bids for the day ahead on a daily basis. DOI: 10.1016/j.ijforecast.2021.11.001
The value of solar forecasts and the cost of their errors: A review – Gandhi et al. 2024 – Despite the advances in solar forecasting methods, and their ever-increasing accuracy, little is known about their value for real applications, e.g., bidding in the electricity market, power system operations, and household electricity bill reduction. This work comprehensively reviews the value of solar forecasts and the cost of their errors across the different applications available in the literature. DOI: 10.1016/j.rser.2023.113915 (Link to Sciencedirect: https://www.sciencedirect.com/science/article/pii/S1364032123007736 )
