Optimal offering and bidding strategies of renewable energy based large consumer using a novel hybrid robust-stochastic approach

Abstract

In the restructured power market, the participation of large consumer in the market is a challenging issue due to their considerable load demand. To provide the required load of the large consumers with the lowest possible cost, appropriate strategies should be taken by the operator of the large consumer. In this paper, in order to get optimal offering and bidding strategies for a large industrial consumer, a new mathematical model is proposed. The uncertainties of load demand, power market prices, solar radiation, temperature and wind speed are taken into account in the proposed model by using hybrid robust-stochastic approach. The load uncertainty is modeled using robust optimization approach while the other uncertainties are modeled using the stochastic approach. A linear model with integer variables is developed to derive offering and bidding curves, which are robust against the uncertainty associated with the load demand of the large consumer. Obtained results show that the higher amount of uncertain parameter is considered, the higher procurement price has resulted for the large consumer. Although, the higher paid price, the higher robustness against load uncertainty has resulted. In addition, total power procurement cost of the large consumer without considering load uncertainty, obtained as $40,060 while this amount is increased to $50,560 in order to be robust against load uncertainty.