Will Aggregator Reduce Renewable Power Surpluses? A System Dynamics Approach for the Latvia Case Study

Abstract

Power demand-side management has been identified as one of the possible elements towards a more flexible power system in case of increased capacities of variable renewable energy sources—solar and wind energy. The market coordinators or aggregators are introduced to adjust the electricity consumption by following the market situation. However, the role of aggregators is mainly analysed from the economic perspective, and the demand side management is performed to maximise the utilisation of low price power during off-peak hours. However, this research focuses on analysing the introduction of aggregators as a future player to increase the total share of renewable power and decrease the surplus solar and wind electricity occurrence. An in-depth system dynamics model has been developed to analyse the hourly power production and power consumption rates at the national level for the Latvia case study. The results show that introducing aggregators and load shifting based on standard peak shaving can increase the share of surplus power and does not benefit from increased utilisation of solar and wind power. On the contrary, demand-side management based on available RES power can decrease the surplus power by 5%.

When the Household Becomes Environmentally Friendly—Dynamic Simulation of Hybrid Energy System’s Feasibility

“…In general, the process of developing a system dynamics model consists of several sequential steps. These steps include problem formulation, which is the identification of dynamic hypotheses that explain the causes of the problem, model formulation and simulation, which means model testing to assess its correspondence to the real situation, as well as policy formulation and drawing conclusions [15,27].…”

“…The values for these elements are defined through mathematical equations and constants. In the hourly model of the dynamic system, the household consumption profile is assumed based on input data obtained from a system dynamics model developed in 2021 for studying the potential of aggregators to reduce renewable energy surplus in Latvia [27]. The model assumes hourly electricity prices based on historical indicators from the 2021 NordPool electricity market [21], considering them as indicative of electricity price trends for the next decade.…”

“…The hourly amount of PV produced electricity, based on Latvian climatic conditions, is determined in the sub-model: PV installed capacity and production (see Figure 4). Solar electricity production capacity is based on average solar irradiation data [28] and assumptions about the average efficiency of PV panels [29]; these data are obtained from a system dynamics model developed in 2021 [27]. The installed PV capacity is calculated taking into account the considered household's annual electricity consumption, which is assumed to be 7800 kWh/year.…”

Unlocking the Value of Aggregated Demand Response: A Survey of European Electricity Markets

“…The literature about aggregators is extensive and covers a broad area, from describing the value of aggregators for the electricity system [10,11] and consumers [12], to aggregator profit maximization through optimal scheduling [13,14], to aggregator behavior in the electricity markets [15][16][17][18][19][20][21]. The literature on DR and aggregator participation in electricity markets has shown that DR can be an effective tool for balancing supply and demand on the grid and that aggregators can play an important role in providing flexibility and balancing services [22][23][24][25][26].…”

Business Models for Energy Community in the Aggregator Perspective: State of the Art and Research Gaps

“…Considering this framework, it is now evident that, among various types of energy companies, the right choice could be an Aggregator in accordance with the expertise gained operating local facilities, infrastructures, and services connected to DER production. The Aggregator has, in fact, the role of gathering electricity demand, the energy produced, and load flexibility from the prosumer's devices, engaging different electricity markets in which electricity and ancillary services are traded [27]. The literature on Aggregators is not so extensive, but the most acknowledged setup for this entity is the local flexible market operator, which supervises the cluster's activities and internal transactions, as described in [28].…”