Risk-Based Virtual Power Plant Implementation Strategy for Smart Energy Communities

Abstract

This paper focuses on a virtual power plant (VPP) implementation strategy for smart local energy communities (SECs) with energy service providers. It is difficult to balance energy in the implementation stage due to uncertainties in demand and resources. Therefore, VPP implementation was modeled using the risk factor of energy balance. Using this risk factor, it was shown that the temporal correlation between demand and resources was the dominant factor involved in VPP implementation. Based on this, two risk-based VPP implementation strategies are proposed: an optimization-based strategy and a simple strategy that is solved in an iterative way. To minimize VPP implementation costs, the proposed strategies select the resources that have high correlation coefficients with demand and low correlation coefficients with other resources. Experimental results using real data sets show that the proposed strategies based on the risk factor are effective means of VPP implementation for commercial and residential SECs. The results imply that VPPs for commercial SECs are possible when PV is used as the main resource and is supplemented by wind, and it is effective to configure VPPs for residential SECs using wind according to the correlation between demand and resources.