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Optimal bidding strategy for virtual power plant participating in combined electricity and ancillary services market considering dynamic demand response price and integrated consumption satisfaction

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  • Mei, Shufan
  • Tan, Qinliang
  • Liu, Yuan
  • Trivedi, Anupam
  • Srinivasan, Dipti

Abstract

The virtual power plant (VPP) plays an important role in managing distributed energy by integrating renewable energy sources, energy storage systems and dispatchable loads. It can not only provide peak regulation services as good flexible resources, but also participate in the electricity market for additional profit. This paper presents a multimarket model to develop an optimal bidding strategy for VPP. To enhance the effectiveness of demand response, a fixed time of use price is converted into a dynamic response price. The integrated consumption satisfaction is quantified from both comfort and economy perspectives. Multi-objective optimization is carried out to maximize market profit of VPP as well as consumer satisfaction. The results show that: (1) Compared to time of use prices, VPP's profit and consumers' satisfaction level increased by 12.46% and 3.26% respectively under dynamic response prices. (2) The increase in the market profit of VPP is accompanied by a gradual decline in integrated consumption satisfaction. There are two inflection points in the process of decline, occurring at satisfaction levels of 1.01 and 0.98 respectively. (3) The multi-objective optimization strategy can achieve a win-win situation for both its operator and the internal consumers.

Suggested Citation

  • Mei, Shufan & Tan, Qinliang & Liu, Yuan & Trivedi, Anupam & Srinivasan, Dipti, 2023. "Optimal bidding strategy for virtual power plant participating in combined electricity and ancillary services market considering dynamic demand response price and integrated consumption satisfaction," Energy, Elsevier, vol. 284(C).
    • Handle: RePEc:eee:energy:v:284:y:2023:i:c:s0360544223019862
    DOI: 10.1016/j.energy.2023.128592
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    References listed on IDEAS

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