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Optimal bidding and coordinating strategy for maximal marginal revenue due to V2G operation: Distribution system operator as a key player in China's uncertain electricity markets

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  • Lei, Xiang
  • Yu, Hang
  • Shao, Ziyun
  • Jian, Linni

Abstract

This paper proposes a novel management scheme, namely, the distribution system operator (DSO) as a key player participating in China's electricity markets owing to its high value-added capability, high customer loyalty and robust risk resistance. In light of this, this paper discusses the maximal marginal revenue for DSO in uncertain electricity markets with vehicle-to-grid operation incorporated. Initially, considering different benefit expectations of electric vehicles (EVs) owners, DSO could provide preferential contracts, including the discount price contract (DPC) and revenue-sharing contract (RSC), in exchange for the management rights of EVs. Then, the stochastic optimization model considering the spatiotemporal uncertainties of EVs and electricity markets is built up, and the optimal bidding and coordinating strategy are proposed to maximize the marginal revenue of DSO. Comprehensive case studies are conducted in a 31-node distribution system of a university campus under the electricity markets in Guangdong, China. Results reveal that different distribution of EVs parking lots has a significant impact on the profit of DSO, and the revenue for DSO is 13,477 yuan more than that for EVA by scheduling 1400 EVs' charging/discharging behavior properly. Additionally, the DSO with RSCs is exposed to 25% less market volatility risk than that with DPCs.

Suggested Citation

  • Lei, Xiang & Yu, Hang & Shao, Ziyun & Jian, Linni, 2023. "Optimal bidding and coordinating strategy for maximal marginal revenue due to V2G operation: Distribution system operator as a key player in China's uncertain electricity markets," Energy, Elsevier, vol. 283(C).
    • Handle: RePEc:eee:energy:v:283:y:2023:i:c:s0360544223017486
    DOI: 10.1016/j.energy.2023.128354
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    5. Abdolrasol, Maher G.M. & Hannan, M.A. & Tiong, S.K. & Ansari, Shaheer & Hamoudi, Yanis & Ker, Pin Jern & Hossain, M.J., 2025. "Vehicle-to-grid energy technologies: Patent landscape analysis, technical updates and innovations towards sustainable transportation," Renewable and Sustainable Energy Reviews, Elsevier, vol. 224(C).
    6. Youngkook Song & Yeonouk Chu & Yongtae Yoon & Younggyu Jin, 2025. "Virtual Power Plant Bidding Strategies in Pay-as-Bid and Pay-as-Clear Markets: Analysis of Imbalance Penalties and Market Operations," Energies, MDPI, vol. 18(6), pages 1-22, March.
    7. Li, Jianwei & Zou, Weitao & Yang, Qingqing & Yao, Fang & Zhu, Jin, 2024. "EV charging fairness protective management against charging demand uncertainty for a new “1 to N” automatic charging pile," Energy, Elsevier, vol. 306(C).
    8. Hugo Algarvio & António Couto & Ana Estanqueiro, 2024. "RES.Trade: An Open-Access Simulator to Assess the Impact of Different Designs on Balancing Electricity Markets," Energies, MDPI, vol. 17(24), pages 1-18, December.
    9. Ebrahimi, Mahoor & Ebrahimi, Mahan & Shafie-khah, Miadreza & Laaksonen, Hannu, 2024. "EV-observing distribution system management considering strategic VPPs and active & reactive power markets," Applied Energy, Elsevier, vol. 364(C).
    10. Suryakiran, B.V. & Nizami, Sohrab & Verma, Ashu & Saha, Tapan Kumar & Mishra, Sukumar, 2023. "A DSO-based day-ahead market mechanism for optimal operational planning of active distribution network," Energy, Elsevier, vol. 282(C).
    11. Lei, Xiang & Yu, Hang & Zhong, Jiahao & Shao, Ziyun & Jian, Linni, 2025. "A data-driven robust optimal day-ahead bidding strategy considering V2G operation for distribution-system-side virtual power plant," Energy, Elsevier, vol. 338(C).
    12. Wang, Yusheng & Jiang, Ke & Liu, Yuxi & Jiang, Yan & Huang, Yaxing, 2025. "Can public-private partnerships promote sustainable electric vehicle charging infrastructure deployment?," Energy, Elsevier, vol. 320(C).
    13. Lehtola, Timo, 2025. "Vehicle-to-grid applications and battery cycle aging: A review," Renewable and Sustainable Energy Reviews, Elsevier, vol. 208(C).
    14. Yun, Sujin & Woo, JongRoul & Kwak, Kyuil, 2025. "Unlocking peak shaving: How EV driver heterogeneity shapes V2G potential," Energy, Elsevier, vol. 329(C).
    15. Cristian Valeriu Stanciu & Narcis Eduard Mitu, 2025. "Price Behavior and Market Integration in European Union Electricity Markets: A VECM Analysis," Energies, MDPI, vol. 18(4), pages 1-25, February.
    16. Yan Lu & Bo Ning & Pengyun Geng & Yan Li & Jiajie Kong, 2025. "Research on the Current Status and Key Issues of China’s Green Electricity Trading Development," Energies, MDPI, vol. 18(7), pages 1-21, March.

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