Advertisement

Co-optimization of demand response and interruptible load reserve offers for a price-making major consumer

  • Mahbubeh Habibian
  • Golbon Zakeri
  • Anthony Downward
  • Miguel F. Anjos
  • Michael Ferris
Original Paper
  • 17 Downloads

Abstract

We study demand-side participation in an electricity market for an industrial consumer of electricity, with some flexibility to reduce demand, and capable of offering interruptible load reserve. Our consumer is a price maker, and the impact of its actions in the market is modelled via a bi-level optimization problem. We have extended a standard model for optimal strategic consumption, to the case where reserve offer curves need to be optimized simultaneously with consumption curves; our models provide intuition into this interaction. Furthermore, we provide tailor-made solution strategies for the resulting problems under uncertainty, and report numerical results of our implementation on instances over the full New Zealand network yielding a realistic and large problem set.

Keywords

Demand response Bi-level optimization Decomposition methods Integer programming Stochastic optimization 

Supplementary material

References

  1. 1.
    Cramton, P., Stoft, S.: A capacity market that makes sense. Electr. J. 18(7), 43 (2005)Google Scholar
  2. 2.
    Albadi, M.H., El-Saadany, E.: A summary of demand response in electricity markets. Electr. Power Syst. Res. 78(11), 1989 (2008)CrossRefGoogle Scholar
  3. 3.
    Li, N., Chen, L., Low, S.H.: Optimal demand response based on utility maximization in power networks. In: 2011 IEEE Power and Energy Society General Meeting, pp. 1–8 (2011)Google Scholar
  4. 4.
    Sæle, H., Grande, O.S.: Demand response from household customers: experiences from a pilot study in Norway. IEEE Trans. Smart Grid 2(1), 102 (2011)CrossRefGoogle Scholar
  5. 5.
    Tsui, K.M., Chan, S.C.: Demand response optimization for smart home scheduling under real-time pricing. IEEE Trans. Smart Grid 3(4), 1812 (2012)CrossRefGoogle Scholar
  6. 6.
    Aketi, P., Sen, S.: Modeling demand response and economic impact of advanced and smart metering. Energy Syst. 5(3), 583 (2014)CrossRefGoogle Scholar
  7. 7.
    Del Granado, P.C., Wallace, S.W., Pang, Z.: The value of electricity storage in domestic homes: a smart grid perspective. Energy Syst. 5(2), 211 (2014)CrossRefGoogle Scholar
  8. 8.
    Caves, D.W., Herriges, J.A.: Optimal dispatch of interruptible and curtailable service options. Oper. Res. 40(1), 104 (1992)CrossRefGoogle Scholar
  9. 9.
    Majumdar, S., Chattopadhyay, D., Parikh, J.: Interruptible load management using optimal power flow analysis. IEEE Trans. Power Syst. 11(2), 715 (1996)CrossRefGoogle Scholar
  10. 10.
    Bhattacharya, K.: Competitive framework for procurement of interruptible load services. IEEE Trans. Power Syst. 18(2), 889 (2003)MathSciNetCrossRefGoogle Scholar
  11. 11.
    Su, C.L., Kirschen, D.: Quantifying the effect of demand response on electricity markets. IEEE Trans. Power Syst. 24(3), 1199 (2009)CrossRefGoogle Scholar
  12. 12.
    Kirschen, D.S.: Demand-side view of electricity markets. IEEE Trans. Power Syst. 18(2), 520 (2003)CrossRefGoogle Scholar
  13. 13.
    Madaeni, S.H., Sioshansi, R.: The impacts of stochastic programming and demand response on wind integration. Energy Syst. 4(2), 109 (2013)CrossRefGoogle Scholar
  14. 14.
    Wu, A., Philpott, A., Zakeri, G.: Investment and generation optimization in electricity systems with intermittent supply. Energy Syst. 8(1), 127–147 (2017)CrossRefGoogle Scholar
  15. 15.
    EPA. Electricity Customers. Online. https://www.eia.gov/electricity/annual/html/epa_01_02.html (2018). Accessed 16 Jan 2018
  16. 16.
    Electricity Authority. Electricity in New Zealand. Online. https://www.ea.govt.nz/about-us/media-and-publications/electricity-nz/ (2018). Accessed 24 Jan 2018
  17. 17.
    Conejo, A.J., Contreras, J., Arroyo, J.M., De la Torre, S.: Optimal response of an oligopolistic generating company to a competitive pool-based electric power market. IEEE Trans. Power Syst. 17(2), 424 (2002)CrossRefGoogle Scholar
  18. 18.
    Kazempour, S.J., Conejo, A.J., Ruiz, C.: Strategic bidding for a large consumer. IEEE Trans. Power Syst. 30(2), 848 (2015)CrossRefGoogle Scholar
  19. 19.
    Daraeepour, A., Kazempour, S.J., Patiño-Echeverri, D., Conejo, A.J.: Strategic demand-side response to wind power integration. IEEE Trans. Power Syst. 31(5), 3495 (2016)CrossRefGoogle Scholar
  20. 20.
    Fisher, M., Apt, J., Sowell, F.: The economics of commercial demand response for spinning reserve. Energy Syst. 9(1), 3 (2018)CrossRefGoogle Scholar
  21. 21.
    Cleland, N., Zakeri, G., Pritchard, G., Young, B.: Boomer-Consumer: a model for load consumption and reserve offers in reserve constrained electricity markets. Comput. Manag. Sci. 12(4), 519 (2015)MathSciNetCrossRefGoogle Scholar
  22. 22.
    Cleland, N., Zakeri, G., Pritchard, G., Young, B.: Integrating consumption and reserve strategies for large consumers in electricity markets. In: Computational management science, pp. 23–30. Springer (2016)Google Scholar
  23. 23.
    Ela, E., Milligan, M., Kirby, B.: Operating reserves and variable generation. TP-5500-51978, NREL (2011)Google Scholar
  24. 24.
    Ellison, J.F., Tesfatsion, L.S., Loose, V.W., Byrne, R.H.: Project report: a survey of operating reserve markets in US ISO/RTO-managed electric energy regions, Sandia Natl Labs Publications, vol. 1000. http://www.sandia.gov/ess/publications/SAND2012 (2012)
  25. 25.
    Transpower. Under Frequency Event Reports. Online. https://www.transpower.co.nz/system-operator/key-documents/under-frequency-event-reports 2018. Accessed 1 Oct 2018
  26. 26.
    Electricity Authority. Wholesale Datasets. Online. https://www.emi.ea.govt.nz/Wholesale/Datasets 2018. Accessed 17 Nov 2017
  27. 27.
    Fortuny-Amat, J., McCarl, B.: A representation and economic interpretation of a two-level programming problem. J. Oper. Res. Soc. 32(9), 783–792 (1981)MathSciNetCrossRefGoogle Scholar
  28. 28.
    Hobbs, B.F., Metzler, C.B., Pang, J.S.: Strategic gaming analysis for electric power systems: an MPEC approach. IEEE Trans. Power Syst. 15(2), 638 (2000)CrossRefGoogle Scholar
  29. 29.
    Pereira, M.V., Granville, S., Fampa, M.H., Dix, R., Barroso, L.A.: Strategic bidding under uncertainty: a binary expansion approach. IEEE Trans. Power Syst. 20(1), 180 (2005)CrossRefGoogle Scholar
  30. 30.
    Ruiz, C., Conejo, A.J.: Pool strategy of a producer with endogenous formation of locational marginal prices. IEEE Trans. Power Syst. 24(4), 1855 (2009)CrossRefGoogle Scholar
  31. 31.
    Bakirtzis, A.G., Ziogos, N.P., Tellidou, A.C., Bakirtzis, G.A.: Electricity producer offering strategies in day-ahead energy market with step-wise offers. IEEE Trans. Power Syst. 22(4), 1804 (2007)CrossRefGoogle Scholar
  32. 32.
    Paul, M.A.M., Klemperer, D.: Econometrica 57(6), 1243 (1989). http://www.jstor.org/stable/1913707 MathSciNetCrossRefGoogle Scholar

Copyright information

© Springer-Verlag GmbH Germany, part of Springer Nature 2018

Authors and Affiliations

  1. 1.University of AucklandAucklandNew Zealand
  2. 2.Polytechnique MontrealMontrealCanada
  3. 3.University of WisconsinMadisonUSA

Personalised recommendations