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Flexible Use of Residential Heat Pumps - Possibilities and Limits of Market Participation

Author

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  • Jessica Raasch

    (Chair for Management Sciences and Energy Economics, University of Duisburg-Essen (Campus Essen))

Abstract

The increased amount of electricity supply from intermittent renewable energy sources leads more and more to high price volatility in electricity spot markets. An increasing share of generation is less dispatchable than in the past, and therefore higher amounts of flexible demand, which can be adjusted towards supply, are required. Even residential consumers are potential market participants, if the smart equipment of buildings and the electricity grid are readily available. This paper investigates the possibility for heat-pump operators to participate in spot markets. Especially problems and possible benefits are investigated when uncertainties in ambient temperatures or prices are considered. Therefore an optimization model, including an air-to-water heat pump, a storage tank and the heated building is implemented in MATLAB. In order to investigate the heat-pumps operation according to optimized heat-supply schedules. Along different scenarios, an agent-based model is used. Namely operations with day-ahead and intraday market participation are investigated, using historical EPEX spot electricity prices for 2014. Results show that uncertainty is a critical issue when private consumers participate in electricity markets. Even with a certain amount of system flexibility, there are tight operational constraints for the heating device, which are hard to fulfill. Short-term decisions including responses to current information are required. The system behavior is acceptable with very shortterm decision making, namely a hourly reoptimization with intraday-market participation. Further on, benefits can be yielded, when a combination of procurement before (day-ahead) and adjustments in the very short term (intraday) are applied.

Suggested Citation

  • Jessica Raasch, "undated". "Flexible Use of Residential Heat Pumps - Possibilities and Limits of Market Participation," EWL Working Papers 1802, University of Duisburg-Essen, Chair for Management Science and Energy Economics, revised Mar 2018.
    • Handle: RePEc:dui:wpaper:1802
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    References listed on IDEAS

    as
    1. Bjoern Felten & Christoph Weber, "undated". "Modeling the Value of Flexible Heat Pumps," EWL Working Papers 1709, University of Duisburg-Essen, Chair for Management Science and Energy Economics.
    2. Blarke, Morten B., 2012. "Towards an intermittency-friendly energy system: Comparing electric boilers and heat pumps in distributed cogeneration," Applied Energy, Elsevier, vol. 91(1), pages 349-365.
    3. Vanhoudt, D. & Geysen, D. & Claessens, B. & Leemans, F. & Jespers, L. & Van Bael, J., 2014. "An actively controlled residential heat pump: Potential on peak shaving and maximization of self-consumption of renewable energy," Renewable Energy, Elsevier, vol. 63(C), pages 531-543.
    4. Paraschiv, Florentina & Erni, David & Pietsch, Ralf, 2014. "The impact of renewable energies on EEX day-ahead electricity prices," Energy Policy, Elsevier, vol. 73(C), pages 196-210.
    5. Pape, Christian & Hagemann, Simon & Weber, Christoph, 2016. "Are fundamentals enough? Explaining price variations in the German day-ahead and intraday power market," Energy Economics, Elsevier, vol. 54(C), pages 376-387.
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    Heat-Pump Operation; Flexible Consumption; Residential Market Participation; Spot-Market Bidding;
    All these keywords.

    JEL classification:

    • Q41 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Demand and Supply; Prices
    • Q48 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - Government Policy

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