Market Equilibrium Based on Renewable Energy Resources and Demand Response in Energy Engineering

Abstract

Smart grid enables the integration of large-scale renewable energy resources (RERs) into the power system, but the subsequent intermittency and uncertainty can have an adverse impact on the networks’ reliability, safety and operation efficiency. Meanwhile, demand response helps greatly mitigate the negative impact associated with RERs. Hence, from the engineering's perspective, the complexity and intelligence of the power system have been on an unprecedented level. In such a complex and intelligent power system, it is essential to investigate the impact of RERs and demand response on the market equilibrium in order to help market participants to make scientific decisions. In this paper, firstly, an overall model of major market participants together with the constraints of transmission and generation is established. Then, the energy market is analyzed with RERs’ uncertainties and demand response. Finally, a 4-bus network is utilized to validate theoretical results, indicating that as the uncertainties increase, power system's operation costs and equilibrium shift will be enlarged; and the effect of demand response can narrow the equilibrium shift and reduce RERs’ integration costs.