Optimal bidding strategy and profit allocation method for shared energy storage-assisted VPP in joint energy and regulation markets

Qiu, Weiqiang; Zhang, Zhi; Liu, Shengyuan; Ding, Yi; Wang, Yiting; Wang, Lianfang; Yang, Li

doi:10.1016/j.apenergy.2022.120158

Cited by 53 publications

(10 citation statements)

References 36 publications

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“…For instance, wind speed is usually modelled following the Weibull distribution [12]. Considering the uncertainties of market prices and renewable power outputs, Zhang et al [13] adopted a stochastic optimization model based on scenarios. However, the SP method is not always applicable to most practical situation because it is hard to obtain the probability density function of uncertainties.…”

Section: Literature Reviewmentioning

confidence: 99%

Flexible operation of a CHP‐VPP considering the coordination of supply and demand based on a strengthened distributionally robust optimization

Fang

Liu

2023

IET Control Theory & Appl

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Due to the generation variability, the growing capacity of renewable energy has posed unprecedented challenges to ensure the security of power system operation. Here, a two‐stage strengthened distributionally robust optimization (DRO) scheme is proposed for theself‐scheduling of a combined heat and power virtual power plant (CHP‐VPP) over a coupled electric power network (EPN) and district heating network (DHN). The CHP‐VPP operator maximizes its profits in the day‐ahead market and minimizes its cost in the real‐time market under the worst‐case realization of the uncertainties. Instead of assuming that the uncertainties follow known probability distributions or confidence bounds, a strengthened ambiguity set based on moment information and Wasserstein metric is built to provide more accurate characterizations of the true probability distribution of uncertainties. In addition, in order to enhance the flexibility of the system, a HOMIE model considering indoor activities and outside temperatures of each building is built to satisfy the comfortable indoor temperature. To make the whole problem tractable, linearisation and duality theory are adopted, and then a tailored column‐and‐constraint generation algorithm is developed to solve the problem. The validity and applicability of the strengthened DRO scheme are verified by an IEEE 33‐bus EPN and 14‐node DHN.

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Section: Literature Reviewmentioning

confidence: 99%

Flexible operation of a CHP‐VPP considering the coordination of supply and demand based on a strengthened distributionally robust optimization

Fang

Liu

2023

IET Control Theory & Appl

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“…While existing literature has explored the strategic behavior of RE in the context of market equilibrium, it has primarily been confined to strategic pricing, often formulated within a bilevel modeling framework that includes an upper-level RE profit maximization model and a lowerlevel market clearing model (Ruiz et al, 2012;Kazempour and Zareipour, 2014;Hartwig and Kockar, 2016;Zou et al, 2016;Heredia et al, 2018;Wang et al, 2018;Guo et al, 2020;Huang et al, 2021;Dai et al, 2022;Naemi et al, 2022;Wang et al, 2022;Zhang et al, 2023a;Zhang et al, 2023b). Commonly, the Karush-Kuhn-Tucker (KKT) conditions (Kazempour et al, 2012;Zeynali et al, 2022) are employed to recast the bilevel problem into a single-level nonlinear framework, namely a mathematical problem with equilibrium constraints (MPEC) (Guo et al, 2020).…”

Section: Introductionmentioning

confidence: 99%

“…A Cournot competition model is introduced in (Huang et al, 2021) to investigate the impact of the strategic operation of grid-level ES systems on wholesale electricity markets. Reference (Zhang et al, 2023a) constructs a joint optimal bidding strategy for RE units supported by shared ES systems, targeting the maximization of expected daily profits within joint energy and regulation markets. Reference (Heredia et al, 2018) proposes a multi-stage stochastic programming model to ascertain the optimal bids for virtual power plants (VPPs) that include wind power plants and private ESs.…”

Section: Introductionmentioning

confidence: 99%

“…While these studies (Ruiz et al, 2012;Kazempour and Zareipour, 2014;Hartwig and Kockar, 2016;Zou et al, 2016;Heredia et al, 2018;Wang et al, 2018;Guo et al, 2020;Huang et al, 2021;Dai et al, 2022;Naemi et al, 2022;Wang et al, 2022;Zhang et al, 2023a;Zhang et al, 2023b) advance the modeling of strategic pricing and market behaviors for the alliance of REs and ESs, they conventionally treat the variable power output constraints of RE resources as fixed parameters. This simplification overlooks the dynamic nature of RE outputs influenced by the integration of ES technologies.…”

Section: Introductionmentioning

confidence: 99%

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Market equilibrium with strategic pricing and strategic constraints in renewable energy: the role of private energy storage

Xiao,

Meng,

et al. 2024

Front. Energy Res.

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With the increasing prevalence of renewable energy (RE) companies equipped with private energy storage (ES) systems, a dual capability emerges to offer strategic pricing and strategic constraints in market competition. Specifically, these RE companies can strategically leverage their own private ESs to modulate the variability of RE output limits and introduce modified constraints within the market. To examine these new strategic behaviors and the resulting market equilibria, we introduce an innovative bilevel strategic behavior model. The upper level of the model delineates the strategy for RE profit maximization through the imposition of strategic constraints and pricing schemes, while the lower level calculates the revenue outcomes for all entities in the day-ahead energy market clearing. The integration of the bilevel models from all strategic entities leads to the formulation of a new equilibrium problem with equilibrium constraints (EPEC), the solution of which indicates a novel market equilibrium. The impacts of these market equilibria on critical system operation metrics are then evaluated across two representative market mechanisms. Our numerical experiments reveal that RE exhibits low sensitivity to the private ES’s cost, suggesting that the behavior of imposing strategic constraints may be widespread among RE companies owning private ESs. Furthermore, the introduction of strategic constraints enhances the competitiveness of RE, significantly affecting social welfare, energy pricing, and RE integration rate. The study concludes with insights that could inform practical market transactions and system operations.

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“…In general, power market deregulation will improve the entire efficiency of power system operation and management. It can also promote the latest technologies by constructing specified market structures (He et al, 2016;Chen et al, 2021;Zhang et al, 2023).…”

Section: Introductionmentioning

confidence: 99%

Energy management considering multiple power markets and microgrid storage

Yan,

Li,

Lai

et al. 2023

Front. Energy Res.

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The operational cost of a microgrid is significantly influenced by the response of storage systems and the complexities of the power market’s tariff structures. This paper addresses the challenges arising from the coexistence of new market entries and traditional tariffs, which contribute to a complex market environment. To tackle this issue, the paper establishes a microgrid market environment encompassing four types of tariffs. By modeling the response of electric storage and cold storage in a microgrid, the study formulates a non-linear mixed-integer optimization problem. Numerical studies are then conducted to verify the model and analyze market performance. The results reveal a trade-off in behavior among different market entries when optimizing the total cost of microgrid operation. These findings shed light on the complexities and trade-offs involved in microgrid operational cost optimization within a diverse market environment, offering valuable insights for market participants.

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Optimal bidding strategy and profit allocation method for shared energy storage-assisted VPP in joint energy and regulation markets

Cited by 53 publications

References 36 publications

Flexible operation of a CHP‐VPP considering the coordination of supply and demand based on a strengthened distributionally robust optimization

Flexible operation of a CHP‐VPP considering the coordination of supply and demand based on a strengthened distributionally robust optimization

Market equilibrium with strategic pricing and strategic constraints in renewable energy: the role of private energy storage

Energy management considering multiple power markets and microgrid storage

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