IDEAS home Printed from https://ideas.repec.org/a/gam/jeners/v16y2022i1p156-d1013007.html
   My bibliography  Save this article

Risk Assessment of User Aggregators in Demand Bidding Markets

Author

Listed:
  • Ching-Jui Tien

    (Department of Electrical Engineering, Cheng-Shiu University, Kaohsiung 833, Taiwan)

  • Chia-Sheng Tu

    (School of Mechanical and Electrical Engineering, Tan Kah Kee College, Xiamen University, Zhangzhou 363105, China)

  • Ming-Tang Tsai

    (Department of Electrical Engineering, Cheng-Shiu University, Kaohsiung 833, Taiwan)

Abstract

This paper mainly discusses the demand bidding and risk management of user aggregators by considering profit and risk. The covariance matrix of demand price was used to analyze the risk model under an uncertain demand price. By considering revenue and cost, the demand bidding strategy of user aggregators was derived to obtain the maximum profit. By using a risk-tolerance parameter β , a new demand bidding model for the user aggregators that takes both risk and profit into consideration was formulated. We simulated the risk posed by fluctuating demand prices for user aggregators using this model. Finally, this paper proposes Feasible Particle Swarm Optimization (FPSO) to solve the demand bidding model of user aggregators. Through the dynamic adjustment of control factor parameters in the FPSO, we changed the behavioral characteristics of various types of particles, improved the search efficiency and stability of particles in high-dimensional space, and sought the optimal solution for the system as a whole. This paper provides a parameter adjustment mechanism, improves the capability of algorithm implementation, and increases the probability of finding the optimal solution. The simulation results suggest that a tradeoff between profit and risk needs to be considered in the search process. By doing so, enterprises’ abilities in terms of operation and management control can be enhanced, and effective demand management can be achieved.

Suggested Citation

  • Ching-Jui Tien & Chia-Sheng Tu & Ming-Tang Tsai, 2022. "Risk Assessment of User Aggregators in Demand Bidding Markets," Energies, MDPI, vol. 16(1), pages 1-14, December.
    • Handle: RePEc:gam:jeners:v:16:y:2022:i:1:p:156-:d:1013007
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/1996-1073/16/1/156/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/1996-1073/16/1/156/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Li, Songrui & Zhang, Lihui & Nie, Lei & Wang, Jianing, 2022. "Trading strategy and benefit optimization of load aggregators in integrated energy systems considering integrated demand response: A hierarchical Stackelberg game," Energy, Elsevier, vol. 249(C).
    2. Lucas, André & Zhang, Xin, 2016. "Score-driven exponentially weighted moving averages and Value-at-Risk forecasting," International Journal of Forecasting, Elsevier, vol. 32(2), pages 293-302.
    3. Liu, Xin & Li, Yang & Lin, Xueshan & Guo, Jiqun & Shi, Yunpeng & Shen, Yunwei, 2022. "Dynamic bidding strategy for a demand response aggregator in the frequency regulation market," Applied Energy, Elsevier, vol. 314(C).
    4. Fazlalipour, Pary & Ehsan, Mehdi & Mohammadi-Ivatloo, Behnam, 2019. "Risk-aware stochastic bidding strategy of renewable micro-grids in day-ahead and real-time markets," Energy, Elsevier, vol. 171(C), pages 689-700.
    5. Dadashi, Mojtaba & Haghifam, Sara & Zare, Kazem & Haghifam, Mahmoud-Reza & Abapour, Mehdi, 2020. "Short-term scheduling of electricity retailers in the presence of Demand Response Aggregators: A two-stage stochastic Bi-Level programming approach," Energy, Elsevier, vol. 205(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Fan, Wei & Tan, Zhongfu & Li, Fanqi & Zhang, Amin & Ju, Liwei & Wang, Yuwei & De, Gejirifu, 2023. "A two-stage optimal scheduling model of integrated energy system based on CVaR theory implementing integrated demand response," Energy, Elsevier, vol. 263(PC).
    2. Yu, Min Gyung & Pavlak, Gregory S., 2023. "Risk-aware sizing and transactive control of building portfolios with thermal energy storage," Applied Energy, Elsevier, vol. 332(C).
    3. Silva, Ana R. & Pousinho, H.M.I. & Estanqueiro, Ana, 2022. "A multistage stochastic approach for the optimal bidding of variable renewable energy in the day-ahead, intraday and balancing markets," Energy, Elsevier, vol. 258(C).
    4. Opschoor, Anne & Lucas, André, 2023. "Time-varying variance and skewness in realized volatility measures," International Journal of Forecasting, Elsevier, vol. 39(2), pages 827-840.
    5. Jun Dong & Yuanyuan Wang & Xihao Dou & Zhengpeng Chen & Yaoyu Zhang & Yao Liu, 2021. "Research on Decision Optimization Model of Microgrid Participating in Spot Market Transaction," Sustainability, MDPI, vol. 13(12), pages 1-26, June.
    6. Alexandros Gabrielsen & Axel Kirchner & Zhuoshi Liu & Paolo Zagaglia, 2015. "Forecasting Value-At-Risk With Time-Varying Variance, Skewness And Kurtosis In An Exponential Weighted Moving Average Framework," Annals of Financial Economics (AFE), World Scientific Publishing Co. Pte. Ltd., vol. 10(01), pages 1-29.
    7. Rutger-Jan Lange & Andre Lucas & Arjen H. Siegmann, 2016. "Score-Driven Systemic Risk Signaling for European Sovereign Bond Yields and CDS Spreads," Tinbergen Institute Discussion Papers 16-064/IV, Tinbergen Institute.
    8. Wang, Fei & Ge, Xinxin & Yang, Peng & Li, Kangping & Mi, Zengqiang & Siano, Pierluigi & Duić, Neven, 2020. "Day-ahead optimal bidding and scheduling strategies for DER aggregator considering responsive uncertainty under real-time pricing," Energy, Elsevier, vol. 213(C).
    9. Dranka, Géremi Gilson & Ferreira, Paula & Vaz, A. Ismael F., 2021. "A review of co-optimization approaches for operational and planning problems in the energy sector," Applied Energy, Elsevier, vol. 304(C).
    10. Russo, Marianna & Kraft, Emil & Bertsch, Valentin & Keles, Dogan, 2022. "Short-term risk management of electricity retailers under rising shares of decentralized solar generation," Energy Economics, Elsevier, vol. 109(C).
    11. David Ardia & Kris Boudt & Leopoldo Catania, 2016. "Generalized Autoregressive Score Models in R: The GAS Package," Papers 1609.02354, arXiv.org.
    12. Venizelos Venizelou & Apostolos C. Tsolakis & Demetres Evagorou & Christos Patsonakis & Ioannis Koskinas & Phivos Therapontos & Lampros Zyglakis & Dimosthenis Ioannidis & George Makrides & Dimitrios T, 2023. "DSO-Aggregator Demand Response Cooperation Framework towards Reliable, Fair and Secure Flexibility Dispatch," Energies, MDPI, vol. 16(6), pages 1-21, March.
    13. Li, Ke & Ye, Ning & Li, Shuzhen & Wang, Haiyang & Zhang, Chenghui, 2023. "Distributed collaborative operation strategies in multi-agent integrated energy system considering integrated demand response based on game theory," Energy, Elsevier, vol. 273(C).
    14. Zhou, Yuan & Wang, Jiangjiang & Yang, Mingxu & Xu, Hangwei, 2023. "Hybrid active and passive strategies for chance-constrained bilevel scheduling of community multi-energy system considering demand-side management and consumer psychology," Applied Energy, Elsevier, vol. 349(C).
    15. Tian, Xiaoge & Chen, Weiming & Hu, Jinglu, 2023. "Game-theoretic modeling of power supply chain coordination under demand variation in China: A case study of Guangdong Province," Energy, Elsevier, vol. 262(PA).
    16. Wang, Yudong & Hu, Junjie, 2023. "Two-stage energy management method of integrated energy system considering pre-transaction behavior of energy service provider and users," Energy, Elsevier, vol. 271(C).
    17. Lv, Chaoxian & Liang, Rui & Zhang, Ge & Zhang, Xiaotong & Jin, Wei, 2023. "Energy accommodation-oriented interaction of active distribution network and central energy station considering soft open points," Energy, Elsevier, vol. 268(C).
    18. Zhang, Yijie & Ma, Tao & Yang, Hongxing, 2022. "Grid-connected photovoltaic battery systems: A comprehensive review and perspectives," Applied Energy, Elsevier, vol. 328(C).
    19. Nikpour, Ahmad & Nateghi, Abolfazl & Shafie-khah, Miadreza & Catalão, João P.S., 2021. "Day-ahead optimal bidding of microgrids considering uncertainties of price and renewable energy resources," Energy, Elsevier, vol. 227(C).
    20. Elsir, Mohamed & Al-Sumaiti, Ameena Saad & El Moursi, Mohamed Shawky & Al-Awami, Ali Taleb, 2023. "Coordinating the day-ahead operation scheduling for demand response and water desalination plants in smart grid," Applied Energy, Elsevier, vol. 335(C).

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jeners:v:16:y:2022:i:1:p:156-:d:1013007. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.