Optimal Transactive Market Operations With Distribution System Operators

Abstract

Distribution system operator (DSO) has traditionally been responsible for the reliable operation of power distribution systems. The advent of distributed energy resources (DERs) and microgrids in distribution networks has required a new platform for DSOs. The new DSO, which is for the most part an independent agent, is responsible for aggregating a widely dispersed DERs (which include small thermal generation units, energy storage, and demand response) and flexible loads in electricity markets. DSO coordinates and balances the transactive dispatch of supply and demand at the distribution level and links wholesale and retail electricity markets. In this paper, a framework for the day-ahead transactive market is proposed which includes end-to-end power system participants starting from the bulk power ISO and ending at DSO, which includes the management of retail customers with small loads. In this paper, DERs are considered in a local distribution area (LDA). The day-ahead transactive scheduling of LDA is modeled as an MILP and solved using the CPLEX solver. This paper offers numerical results considering a DSO that is responsible for the optimal and secure operation of LDA with microgrids. The simulation results show that the proposed DSO framework in a transactive market can efficiently reduce the supply cost of LDA and increase the GenCos’ payoff considering the optimal power exchange with the ISO.