A profitability optimization approach of virtual power plants comprised of residential and industrial microgrids for demand-side ancillary services

Abstract

Nowadays, the high proportion of renewable energy integration continuously boosts the grid’s demand for regulation capacity. But the reasonable utilization remains challenged between the regulation capacity of demand-side resources and the complementary characteristics between market players. This paper primarily investigates the issues of complementary synergy among different types of resources and different microgrids. This is currently a focal point in enhancing the regulation capacity of the power grid. This study considers a variety of resources to form microgrids with distinct characteristics, including residential and industrial loads as typical demand-side resources, which have distinct power and energy features in the demand-side regulation market. Furthermore, this study considers virtual power plants (VPPs) consisting of multiple microgrids (MMGs) in the energy market and regulation market as a two-stage problem with day-ahead scheduling and real-time energy consumption control. Based on this, we develop optimal scheduling models and an adaptive MG participation mechanism to maximize the economic benefit of the VPP and help ensure the frequency stability of the power grid. Innovatively, this work designs an adaptive MG participation mechanism, when the operational cost of the adaptive microgrid is high and the regulation capacity of other microgrids is sufficient to provide frequency support for the grid, the adaptive microgrid will be set as backup. Case studies are conducted to verify the proposed profitability optimization method for VPP.