Abstract
Local flexibility markets (LFMs) are a market-based concept to integrate distributed energy resources into congestion management. However, the activation of flexibility for storage-based flexibility changes the respective state of charge. Compensation in later points of time is needed to regain the original flexibility potential. Therefore, we propose a LFM bid formulation including both flexibility and compensation. Furthermore, flexibility market participation might lead to inc-dec-gaming, i.e., congestion-increasing behavior to maximize profits. However, this inc-dec-gaming might lead to electricity market schedule deviations if LFM offers are not activated. We propose a risk-averse modeling formulation considering the potential non-activation of LFM bids to provide a framework for the assessment of LFM participation comparing different approaches. Our exemplary case studies demonstrate the proposed LFM bid formulation and show the impact of LFM participation modeling on inc-dec-gaming and congestion management costs.
Highlights
With the ongoing expansion of renewable energies in the course of the energy system decarbonization and delayed grid expansion, volumes and costs for congestion management (CM) have risen in the last years, especially in Germany.CM carried out by the transmission and distribution grid operators requires curtailment of renewable energies and redispatch of power plants [1]
wind power plants (WPPs) and PV can be considered for the operational planning in electricity markets, but for CM, they are curtailed by the distribution system operators (DSOs) directly based on regulatory costs
The ongoing decentralization of the European energy system leads to new requirements for grid CM
Summary
With the ongoing expansion of renewable energies in the course of the energy system decarbonization and delayed grid expansion, volumes and costs for congestion management (CM) have risen in the last years, especially in Germany (cf. Figure 1). LFMs have been discussed as a theoretical concept within the literature [6,7], but have been tested in Europe within different demonstrator projects [8,9,10] These demonstrator research projects have established different market designs (cf [11,12]) that can be characterized by at least three main characteristics [10]: The product exchange, the grid actors involved, and the definition of market operators. Market participants such as aggregators or energy management systems (EMS) controlling the DER flexibility determine their (day-ahead) electricity market schedule (qM). The intraday market is an alternative market platform but can be used for counter-trading of flexibility activation in LFMs (as a balancing measure), even though the balancing should be carried out by the grid operators to prevent additional congestions [23]. We present the formulation of the time-coupled LFM bids and provide a detailed modeling description on how to integrate them into the operational planning process
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