The participation of a renewable energy-based aggregator in real-time market: A Bi-level approach

Abstract

Increasing the share of the renewable energy sources (RESs) in supplying the electrical demand of the energy systems facilitates achieving the sustainable development goals. The main challenge in this regard is the uncertain behavior of the RESs in the real-time (RT) operation. To address this issue, the RESs can participate in the RT energy market through the distributed energy resource aggregator (DERA). The participation of the DERA as a price-maker player in the RT market is addressed in this paper. For this purpose, a bi-level optimization approach is employed in which the problem of the DERA and the RT market are modeled as the upper-level and the lower-level problems, respectively. Moreover, the uncertainties of the RESs are modeled in the DERA’s problem using a risk-based two-stage stochastic model. In this model, the risk level of the DERA is managed using the Conditional Value at Risk (CVaR). The proposed non-linear bi-level model is transformed into a linear single-level one using the Karush-Kuhn-Tucker conditions and the dual theory. The proposed model is applied on the IEEE 6-bus and 24-bus test systems. The results show that the social welfare of the RT market increases in the presence of the DERA through supplying the demand of the market with RESs. Moreover, the effect of the RESs’ uncertainties on the DERA’s decisions and the RT energy market results is managed using the risk-level of the DERA.