A Real-time Operation Scheme of Microgrids with Distributed Generation in Electricity Markets

Nguyen Minh Y

doi:10.12691/ajeee-5-5-4

Abstract

This paper addresses the operation problem of microgrids under market environments. Considering the flexibility of DG sources in operation as well as the availability of market prices, microgrid operators can improve the profit in electricity markets by properly adjusting DG units in real-time corresponding to the price signal which is updated few-hour ahead. Starting with the basic formulation of unit commitments, the paper derives the optimality condition of DG units, i.e., generation levels for maximizing the profit assuming all units are being On (committed). If the capacity constraint results in an excess of the marginal cost to the locational market price, the unit will be considered to be Off. Taken into account the cost associated with switching On/Off the unit, an economic comparison will determine the optimal decision of whether to turn the unit On/Off or remain its current state. The proposed operation scheme is examined in a case study to illustrate its effectiveness with different scenarios of the market price.

Highlights

Distributed Generation (DG) encompasses various prime movers such as small gas-turbine, fuel cell (FC), photovoltaics (PV) and small wind turbine (WT), etc. which has been considered as an important source of power systems in future [1,2]
In [8], a centralized controller for microgrid operation is presented; the algorithm is to determine the optimal bidding of DG units and power exchanged with the main distribution grid by “priority-list” methods that maximizes the profit in the day-ahead electricity market
In equation (1), the first term is the revenue from providing electricity to the customer; the second term is the fuel cost of DG units which is defined as a quadratic function of the generation, PGit; the third term is the purchasing cost of electricity from the market; and the last term is the start-up cost, i.e., the cost associated with the starting process of DG units

Summary

Introduction

Distributed Generation (DG) encompasses various prime movers such as small gas-turbine, fuel cell (FC), photovoltaics (PV) and small wind turbine (WT), etc. which has been considered as an important source of power systems in future [1,2]. The restructuring of electric power industry, and the implementation of electricity markets have allowed small, independent enterprises to build and operate their own power source for profits This means, based on the market price, the electric company can control the generating unit: Which will be On/Off, how much to generate, etc. In [8], a centralized controller for microgrid operation is presented; the algorithm is to determine the optimal bidding of DG units and power exchanged with the main distribution grid by “priority-list” methods that maximizes the profit in the day-ahead (spot) electricity market. The objective function is maximizing profits over operation scheme with two solution stages: (1) determine the pre-given market price It can be expressed the optimal generation with all units are On, (2) consider mathematically as follows.

Notations

The Proposed Operation Scheme

Case Study

Conclusion