Abstract
A key feature of electricity generation in a distribution network is manifested by renewable generation with zero marginal cost. Existing market mechanisms are likely to fail in supporting such decentralized transactions while providing a reasonable price signal to compensate for the investment cost of renewable generators. Given this background, this paper first describes an average pricing market (APM) mechanism for pricing zero marginal cost renewable generation outputs in the distribution network. Then, a decentralized formulation of the APM mechanism is derived using the alternating direction method of multipliers (ADMM). Convergence of the decentralized mechanism can be guaranteed under some mild conditions for parameter setting. Finally, case studies are carried out to demonstrate the presented market mechanism. Simulation results show that the problem of always bidding a zero price by renewable generators in some existing markets can be avoided. The presented method also provides a solution for organizing decentralized electricity transactions in the distribution network and can converge to similar results with those obtained by the centralized one, with a relative error less than 5%.
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
