Abstract
Several demand response (DR) strategies rely on real-time pricing and selfish local optimization, which may not result in optimal electricity consumption patterns from the viewpoint of an energy supplier or a power system. Thus, this paper proposes a strategy enabling centralized adjustments to cost-minimize consumers’ load. By employing the strategy, an aggregator is able to alter electricity consumption in order to remove power imbalances and to participate in the balancing power market (BPM). In this paper, we focus on direct electric space heating (DESH) loads that aim to minimize their heating cost locally. The consumers and an aggregator agree about an indoor temperature band, within which the aggregator is allowed to alter the temperature, and thus the electricity consumption. Centrally, the aggregator procures its electricity demand from a day-ahead (DA) market by utilizing the allowed temperature band and employs the band later in real-time (RT) operation for the balancing of its own imbalances or regulating power in the BPM.
Highlights
The challenge of enabling demand-side participation in power system operation and markets has received increasing attention during the last ten years
Since we focus on direct electric space heating (DESH), the consumers and the aggregator agree about a temperature band that fixes the flexibility available to the aggregator
Since we focus on DESH in this study, the aggregator agrees with the consumers about indoor temperature bands, which it can utilize for the control
Summary
The challenge of enabling demand-side participation in power system operation and markets has received increasing attention during the last ten years. The reason for the attention is mainly the flexibility potential of the demand-side which could be employed to balance variable generation and to improve the operation of electricity markets. Despite the benefits of local decision-making, the decisions and the resulting consumption profile may endanger the energy supplier’s (aggregator’s) balance maintenance and limit the beneficial flexibility from the power system’s point of view. As a result, centralized consumption adjustments become desirable Such strategies combining local and centralized decisions have been investigated, for example, via demand-side bidding [4,5], incentives [6,7], or real-time (RT). The approach is to share the demand-side flexibility between local and centralized decision-making. We define more accurately the assumed market framework, the aggregator and consumers, and we give detailed representation of the proposed strategy together with simulation studies
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