Risk-constrained stochastic market operation strategies for wind power producers and energy storage systems

Abstract

This paper proposes two-stage stochastic models to enable wind power producers (WPPs) and energy storage systems (ESSs) to participate in simultaneous day-ahead energy, spinning reserve, and frequency regulation markets. Unlike previous works, which focused on the WPP benefits, this paper investigates the participation risk and economic profits for both the WPP and the ESS in various operation strategies. Multiple sources of uncertainties are modelled in this paper. Furthermore, a risk management analysis has been done to show the effect of the risk aversion degree on the participation of the facilities. Penalty factors that were assumed as definite amounts in the literature are defined proportional to energy imbalances to penalize the deviation. A set of case studies are designed to compare individual benefits of the ESS and WPP when participating in the day-ahead markets, considering transmission tariffs. The results show that the joint operation can increase the profit by 4% and 34% in comparison with the separate and backup operations, respectively. However, considering the transmission tariffs may reduce the profit of joint operation by 19.5%. A sensitivity analysis is also performed to show how the penalty factors can have impacts on the participation of ESSs and WPPs in the markets.