Practical operation strategies for pumped hydroelectric energy storage (PHES) utilising electricity price arbitrage

Connolly, David; Lund, Henrik; Finn, P.; Mathiesen, Brian Vad; Leahy, Martin J.

doi:10.1016/j.enpol.2011.04.032

Cited by 215 publications

(96 citation statements)

References 28 publications

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“…Electrical energy storage capacity is a traditional criterion for PHESP. Also, on the other hand, the lower reservoir must be large enough and have sufficient water for storage since it concerns the regulating ability of a PHESP [44]. Appendix A.1.4 Proximity to Electricity Grid An electrical distribution station is one of the effective factors.…”

Section: Discussionmentioning

confidence: 99%

An Extended VIKOR-Based Approach for Pumped Hydro Energy Storage Plant Site Selection with Heterogeneous Information

Liu

Gao

et al. 2017

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Abstract:The selection of a desirable site for constructing a pumped hydro energy storage plant (PHESP) plays a vital important role in the whole life cycle. However, little research has been done on the site selection of PHESP, which affects the rapid development of PHESP. Therefore, this paper aims to select the most ideal PHESP site from numerous candidate alternatives using the multi-criteria decision-making (MCDM) technique. Firstly, a comprehensive evaluation criteria system is established for the first time. Then, considering quantitative and qualitative criteria coexist in this system, multiple types of representations, including crisp numerical values (CNVs), triangular intuitionistic fuzzy numbers (TIFNs), and 2-dimension uncertain linguistic variables (2DULVs), are employed to deal with heterogeneous criteria information. To determine the weight of criteria and fully take the preference of the decision makers (DMs) into account, the analytic hierarchy process (AHP) method is applied for criteria weighting. After that, an extended Vlsekriterijumska Optimizacija I Kompromisno Resenje (VIKOR) method is utilized to provide compromise solutions for the PHESP site considering such heterogeneous information. At last, the proposed model is then applied in a case study of Zhejiang province, China to illustrate its practicality and efficiency. The result shows the Changlongshan should be selected as the optimal PHESP.

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Section: Discussionmentioning

confidence: 99%

An Extended VIKOR-Based Approach for Pumped Hydro Energy Storage Plant Site Selection with Heterogeneous Information

Liu

Gao

et al. 2017

Information

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“…If the PHS operator chooses a conventional resource-based power to pump the water uphill, then it would be subject to the power market price. The PHS operator could find other attractive opportunities on the market, such as price arbitrage [20] and the provision of reserve power [21]. These markets are relatively deeper than the wind power surplus only, because they include the wholesale market, the secondary and tertiary reserve markets.…”

Section: Methodsmentioning

confidence: 99%

Analysis of financial mechanisms in support to new pumped hydropower storage projects in Croatia

et al. 2013

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h i g h l i g h t s" The most widespread storage in power systems is the pumped/reversible hydro storage. " The electricity market does not adequately rewarded all services that PHS provide to the electricity system. " The FIT-GO varies in the range of 42-265 €/MW h for an average capacity factor of 20%. a r t i c l e i n f o t r a c tThis paper analyses potential supporting schemes for pumped hydro storage (PHS) facilities in Croatia, which would guarantee recovery of the investment cost, with feed-in tariffs -for instance -which would guarantee payment for discharging wind-originated power as a reward for boosting the integration of renewable energy sources (RESs). The payment level acts as a floor basis for the PHS operator during the decision-making process to contract fixed payments for wind support or to act market-free on other market segments, through price arbitrage and reserve provision. The market share required for the efficient operation of a PHS facility and the levels of feed-in tariff (FIT) are set mathematically. Main findings put the level of FIT for an applied project in Croatia in the range 42-265 €/MW h for an average load factor of 20%, depending on particular local conditions, such as the level of wind power curtailment in the system, the power price for charging the storage and the number of pumps and penstocks, which could lower the capital cost. It is claimed that not all services that PHS provides to the electricity system are adequately rewarded by the electricity market, and thus there is a serious uncertainty as to how investment costs in energy storage would be recovered. Other elements, outside the market, are likely to influence the operation of PHS, such as the regulated level of a desirable rate of curtailment of RES power excess, the adequate level of energy security and the reserve margins which PHS could help to ensure.

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“…A large share of the existing PBUC work assumes perfect foresight of future prices and the storage plant to be small enough to be a price-taker in the considered market (e.g., [18][19][20][21][22][23]). Although quite some studies discuss a relaxation of the perfect price foresight assumption (e.g., [16,[24][25][26][27][28][29][30]), less attention has been given to the relaxation of the price-taking assumption in PBUC arbitrage models. However, either large-scale or multiple small-scale storage plants that are operated cooperatively could benefit from considering the price-effect of (dis)charge actions.…”

Section: Scope and Approachmentioning

confidence: 99%

“…The objective function is still subject to (3) - (11) and (20), and now additionally subject to (25) - (30), with X sw,lo h,u and X sw,up h,u being the lower and upper bound of the (dis)charge volume corresponding to step u, respectively. The binary variables s h,u correspond to the steps of the stepwise function, and can be considered as Special Ordered Set of type one (SOS1) variables [51].…”

Section: Stepwise Approximation Of Time-varying Piecewise Linear Funcmentioning

confidence: 99%

Price-based unit commitment electricity storage arbitrage with piecewise linear price-effects

Brijs

Geth

Siddiqui

et al. 2016

Journal of Energy Storage

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Electricity storage plants can be used for many applications, with one of the most studied applications being arbitrage in the day-ahead market. Terms of use: Documents inAlthough the arbitrage value is related to the presence of price spreads, it also depends on the effect of (dis)charge actions on prices, as arbitrage generally reduces price spreads by increasing off-peak prices when charging and decreasing peak prices when discharging. As such, there are two important assumptions in price-based unit commitment arbitrage models: first, whether the storage operator is assumed to have perfect knowledge of future prices, and second, whether they recognize that their (dis)charge actions may affect those prices, i.e., the price-taking or pricemaking assumption. This article proposes a comprehensive formulation of the arbitrage problem including detailed operating constraints, and focuses on relaxing the price-taking assumption by considering real-world price-effect data, published in the form of hourly piecewise linear relationships between quantity and price based on submitted bids, which are referred to as "market resilience functions". These can be used to (1) evaluate the price-taking and price-making assumptions based on simplified price-effects, and to (2) provide an upper limit to the arbitrage value under the assumption that prices and price-effects are known at the decision stage. In addition, a stepwise approximation to the piecewise linear functions is developed to reduce computation time, i.e., from mixed-integer nonconvex quadratic programming to mixed-integer linear programming, while providing lower-and upper bound approximations to the arbitrage value. The developed models are applied to the Belgian day-ahead market for 2014, and show that the price-effect has a strong impact on the operation and arbitrage value of large-scale storage.

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Practical operation strategies for pumped hydroelectric energy storage (PHES) utilising electricity price arbitrage

Cited by 215 publications

References 28 publications

An Extended VIKOR-Based Approach for Pumped Hydro Energy Storage Plant Site Selection with Heterogeneous Information

An Extended VIKOR-Based Approach for Pumped Hydro Energy Storage Plant Site Selection with Heterogeneous Information

Analysis of financial mechanisms in support to new pumped hydropower storage projects in Croatia

Price-based unit commitment electricity storage arbitrage with piecewise linear price-effects

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