Fair Virtual Energy Storage System Operation for Smart Energy Communities

Abstract

A virtual energy storage system (VESS) logically shares a physical energy storage system among multiple units. In resource sharing, the distribution of benefits is a critical problem. As a resolution, this study proposes a fair VESS operation method for smart energy communities that involve groups of energy consumption units. First, the cost and resource fairness indices are defined as the benefit and VESS usage proportional to the investment cost, respectively. The fair VESS operation problem is formulated considering the fairness indices that could be solved optimally by applying gradient methods without additional computational burden. The simulation results using the dataset in Korea demonstrate that the proposed operation allows the fair distribution of the benefit and resource usage among units with a marginal benefit reduction of approximately 5% in relation to the VESS operation to maximize the benefit. Moreover, it is shown that the resource fairness that controls the VESS usage limits the total benefit, and the cost fairness distributes the benefit among units according to the cost contribution. Furthermore, the proposed VESS operation can manage the VESS lifetime and improve the system performance of the utility grid.