Ancillary Service Market Research Articles

Techno-Economic Assessment of a Large-Scale Electrolysis Plant in Hydrogen and Ancillary Service Markets

Hydrogen electrolysis systems have seen considerable interest from energy communities as a potential solution for shifting from fossil-based energy resources to clean energy alternatives. The system consists of transforming electricity into hydrogen via water electrolysis. As it is expected to have a large-scale connection with the grid to compensate the fluctuation of renewables, it is important to understand the system’s technical and economic feasibility. Therefore, this work aims to provide a high-level techno-economic assessment for the participation of a large-scale electrolysis plant in hydrogen and grid ancillary service markets. The plant generates revenue from two sources: hydrogen and frequency regulation. Based on market prices of electricity and hydrogen, a linear programming (LP) optimization has shown that a 50MW electrolysis plant can generate a 33% increase in profit if the plant includes the grid support market in the business model. Additionally, simulations under unstable grid frequency have shown high reactivity of the system to maintain grid stability.

A Tool to Optimize the Participation of BESS to the UK Ancillary Services Market

In the last decade, several applications and studies have demonstrated that, thanks to their fast response time, Battery Energy Storage Systems (BESSs) are a promising technology to incorporate operational flexibility in grids and plants, opening to the possibility of providing a set of different grid services. In this context, this paper defines an optimization model to encode UK market rules and output the optimal set of offers on day-ahead and intraday markets, dynamic frequency response services and imbalance settlement, with a specific focus on a BESS. The proposed mathematical model includes BESS technical constraints and market temporal sequencing, also modelling the State Of Energy Management. Limitations on the number of cycles per day and optimization of the battery use are implemented. A Mixed Integer Linear Programming problem is defined to reduce the computational burden and to integrate the model in the Energy Management System (EMS) developed by the University of Genoa. Specific tests have been performed, allowing to compare scenarios in which ancillary services are enabled or not. According to the results, Dynamic Frequency Response services are the most profitable market. The integration in the EMS of the constraints related to the encoded market sections allows to exploit this tool to evaluate the profitability of investments involving a BESS over long time horizon.

Mechanism Design for Ancillary Service Market Considering Social Welfare and Fairness

Mechanism Design for Ancillary Service Market Considering Social Welfare and Fairness

Decision Aid Model for Private-owned Electric Vehicles Participating in Frequency Regulation Ancillary Service Market

Decision Aid Model for Private-owned Electric Vehicles Participating in Frequency Regulation Ancillary Service Market

Design of Robust Var Reserve Contract for Enhancing Reactive Power Ancillary Service Market Efficiency

Design of Robust Var Reserve Contract for Enhancing Reactive Power Ancillary Service Market Efficiency

A joint clearing model for the participation of renewable energy and energy storage in the frequency modulation ancillary service market considering performance differences

The increasing growth in installed capacity for renewable energy sources has progressively replaced traditional thermal power units as synchronous power contributors. This transition has led to a reduction in system inertia and resources for frequency regulation, creating a need for renewable energy and energy storage to participate in system frequency modulation. Empirical studies indicate that the current market mechanism for frequency modulation auxiliary services, which predominantly rely on thermal power, is suboptimal for leveraging the unique capabilities of diverse frequency modulation resources. This inadequacy hinders the power industry’s pursuit of the “dual carbon” goals—carbon neutrality and carbon peak. Hence, this paper proposes a joint clearing model for the involvement of renewable energy and energy storage in the frequency modulation auxiliary service market. It considers performance differences and employs the Analytic hierarchy process (AHP) to guide the optimization of the weights of frequency modulation performance indicators for various frequency modulation resources. This approach allows renewable energy, energy storage, and thermal power to maximize the benefits of their own differentiated advantages in various frequency modulation performance indicators. Consequently, this fosters an increased share of renewable energy within the system while ensuring frequency stability, thereby expediting the achievement of the power industry’s “dual carbon” goals. Finally, computational analyses substantiate that the proposed joint clearing model, accounting for performance differentials, can enhance the renewable energy share in the system and simultaneously reduce the societal costs associated with frequency modulation services.

Equilibrium decisions of electricity and ancillary services for energy storage in a renewable power system

Mitigating the power supply fluctuations and maintaining profitability is essential for the operation of the renewable power system (RPS). This study examines, from a supply chain perspective, how the decisions of generators with energy storage technologies (ESTs) in the electricity market (EM) and ancillary services market (ASM) will affect the volatility and profitability of the RPS. The supply chain network equilibrium approach is adopted to investigate the optimal transaction prices and volumes among various decision-makers in the network with the objectives of maximizing profits. The equilibrium conditions are presented with the variational inequality theory and a modified projection algorithm. A case study based on a real situation is carried out and the results show that: (1) When ESTs are used in the EM only, it works well on smoothing the fluctuations of electricity output and price. (2) ESTs, when used in the ASM, can significantly improve the profitability of both the generator and the RPS. (3) When ESTs are used in both the EM and ASM, ancillary services account for approximately 84 % of storage capacity. In addition, ESTs can also promote the consumption of renewable power. This study provides valuable insights for informed decisions to enhance the economic and stable operation of the RPS.

Operation of Grid-Connected Multi-Microgrids Constrained to Participation in the Energy and Ancillary Services Markets Considering Uncertainties of Generation and Load

Operation of Grid-Connected Multi-Microgrids Constrained to Participation in the Energy and Ancillary Services Markets Considering Uncertainties of Generation and Load

Operation of Grid-Connected Multi-Microgrids Constrained to Participation in the Energy and Ancillary Services Markets Considering Uncertainties of Generation and Load

Operation of Grid-Connected Multi-Microgrids Constrained to Participation in the Energy and Ancillary Services Markets Considering Uncertainties of Generation and Load

Bidding strategy of the virtual power plant consisting of thermal loads controlled by thermostats for providing primary frequency control ancillary service

The purpose of this article is to provide a model for the effective use of on/off loads and thermal loads controlled by thermostats (TCL) in providing primary frequency control (PFC). To this end, the mentioned loads have been aggregated in the form of a virtual power plant (VPP), allowing their cumulative capability to be offered as a bid for ancillary services. In order to determine VPP bids, a droop curve similar to the droop curve of traditional power plants has been extracted for VPP, which includes the technical limitations of VPP member loads. In formulating the VPP bidding strategy, the goal is to maximize profits and to use the capabilities of TCLs more effectively; their temperature set point is considered variable, as well as the constraint of compressor lockout, energy consumption level, device’s fire frequency and the duration of their continued response (deployment end) are incorporated in the model. The results of the model are the maximum power that can be provided to the primary frequency ancillary service market and its profit. The presented model has been simulated on a test system including 70 domestic loads in MATLAB software and checked under five different scenarios. According to the obtained results, considering the variable temperature set point for TCL leads to increasing the power of VPP by 7.33%. Moreover, considering compressor lockout constraint and increasing deployment end lead to a 22.4% and 3.54% reduction to the power of VPP respectively.

Strategic interaction between wholesale and ancillary service markets

In electricity markets, ancillary services (AS) are vital to ensuring system reliability through the instantaneous balancing of supply and demand. An important current policy question is whether AS markets clear simultaneously or sequentially with wholesale markets. We develop a model to study the strategic implications of market timing. We demonstrate that a strategic incentive to reduce AS and, consequently, lower marginal cost in the wholesale market arises when markets clear sequentially. Using data from Alberta, we find that the strategic effect has a small impact on wholesale outcomes but a large impact on the AS market.

Electric vehicle charging as a source of nordic fast frequency reserve—proof of concept

AbstractDemand‐side flexibility or demand response (DR) has long been recognized as a potential source of balancing capacity. The charging of electric vehicles (EVs) is a known source of flexible capacity, and the vast amount of charging capacity available can be utilized for valuable applications, including ancillary power markets, by controlling the charging sessions according to the needs of the power system. One identified and unexplored potential market for EV DR capacity is the Fast Frequency Reserve (FFR) market for the Nordic system area. This article proposes and demonstrates that a home charger can participate in this extremely fast reacting ancillary service market with only software modifications made to the charger. The biggest challenge in the FFR market is the response time requirement for capacity activation. When a certain frequency limit is exceeded, the activation must happen within 0.7 s in the worst case. In this study, a laboratory test setup was constructed to test the capabilities of the FFR‐enabled EV charger. The tests were conducted by building a laboratory microgrid capable of changing the grid frequency. Additionally, an economic feasibility study was carried out to evaluate the business potential of the concept in Finland. The economic study included an analysis of the concept's potential with different levels of DR service availability. The laboratory tests demonstrated the FFR capabilities of the charger and as a final outcome of the research, the Norwegian transmission system operator (TSO) approved the tested charger as a type‐prequalified FFR‐providing entity. The economic study revealed that the approach has good business potential, primarily because of the almost non‐existent cost side even if the availability rate decreases significantly.

Optimal allocation of bi-level energy storage based on the dynamic ancillary service price

A bi-level optimization model was proposed in multi-stakeholder scenarios considering energy storage ancillary services to coordinate the optimal configuration between power grid and wind and solar energy storage power stations. The upper and lower levels were optimized to minimize the power grid operation cost and wind and solar energy storage station cost, respectively. A dynamic pricing mechanism was proposed to efficiently coordinate the upper and lower levels and accomplish the optimal configuration of the energy storage capacity. The upper layer determines the price and communicates it to the lower layer, while the lower layer optimizes the energy storage scale and operation plan according to the price and feeds it back to the upper layer. The optimal price and the optimal configuration of energy storage participating in ancillary service market were obtained using CPLEX. Finally, the performance of the model was validated by evaluating actual power grid operating data from a provincial power system.

Modeling and operation strategy of nuclear power plant with electric heat storage in the ancillary service market

In the power ancillary service market, power sources can participate in peak shaving and obtain profits. However, nuclear power plants (NPPs) cannot contribute sufficient peak-shaving capability to the power system and obtain peak-shaving profits due to their limited flexibility as the base load. To tackle this challenge, an electrothermal coupled model for NPPs is proposed in this paper, which combines the characteristics and constraints of nuclear power units and electric heat storage (EHS). The coupling model can enhance the flexible adjustment capability of NPPs by increasing their self-consumption. Meanwhile, the operation strategy of NPPs considering the electrothermal coupling model is developed to enhance the NPP operation profits. Moreover, a cost calculation method for NPPs is developed, which can calculate the peak-shaving compensation and cost-sharing of NPPs. The effectiveness of the proposed method is verified by numerous simulations using the model of the Hongyanhe Nuclear Power Plant in Liaoning, China. Compared with the three traditional methods, the profit of the EHS is increased by 3%, the peak-shaving compensation is enhanced by 4.4%. Meanwhile, the cost-sharing is reduced by 40%, and the total profits of the proposed method are improved by 18.9%.

Optimal Configuration of Power-to-Heat Equipment Considering Peak-Shaving Ancillary Service Market

The serious problem of wind power curtailment in northern China has created a pressing need to enhance the peak-shaving ability of the power system. As the main source of power supply in northern China, combined heat and power (CHP) units have significant potential for peak-shaving. Currently, the Chinese government encourages CHP plants to increase their peak-shaving capacity by installing power-to-heat (P2H) equipment. In addition, the government has implemented auxiliary service market policies to encourage CHP plants to provide peak-shaving services. In order to maximize economic benefits for CHP plants, this paper proposes an optimal configuration method of P2H equipment with the static payback time (SPT) as the objective function. Cost and income models of installing the P2H equipment are constructed by taking into account the auxiliary service market policies. The peak-shaving income model of the CHP plant is derived emphatically as a key part of the proposed method. Finally, the district heating region in Jilin province is used as a case study example. The results show that adding the P2H equipment is significantly effective in improving the peak-shaving ability of CHP units, and investing in heat pumps is more cost-effective than electric boilers. The proposed method can be applied to other northern regions relying on CHP units for central heating, providing a valuable solution to the problem of wind power curtailment in these regions.

Source-load cooperative multi-modal peak regulation and cost compensation mechanism in China’s ancillary service electricity market

To enhance the market participation initiatives from the power source and load sides, we propose a novel power system optimal scheduling and cost compensation mechanism for China’s peak regulation ancillary service market. Owing to China’s energy structure, thermal power accounts for nearly half of the country’s installed power generation capacity. Although the willingness of thermal power units to participate in peak regulation auxiliary services is low, we propose a peak regulation cost compensation and capacity-proportional allocation mechanism. This mechanism comprehensively considers the source-load initiative. From the source side, it encourages entities to participate in peak regulation, and the restriction of the peak regulation initiative is set to ensure that each entity benefits from the peak regulation transaction. From the load side, it takes the shiftable and sheddable load as the hybrid demand response and uses the price information to influence the power consumption behavior of the user side. Subsequently, a peak regulation scheduling model was constructed with the multi-objective minimum thermal power output fluctuation of the lowest system operating cost and minimum renewable energy abandonment. This was solved using a mixed-integer linear programming model and CPLEX. Finally, a power system consisting of wind-solar-hydro-thermal-storage and hybrid demand response with a modified IEEE 30-bus system was tested to verify the effectiveness. It was proven that the proposed method improves the utilization rate of renewable energy and optimizes the scheduling of the economic benefit system of each power generation entity.

Economic Analysis of Li-Ion Battery–Supercapacitor Hybrid Energy Storage System Considering Multitype Frequency Response Benefits in Power Systems

With the promotion of carbon peaking and carbon neutrality goals and the construction of renewable-dominated electric power systems, renewable energy will become the main power source of power systems in China. Therefore, ensuring frequency stability and system security will emerge as pivotal challenges in the future development process. Created by combining a Li-ion battery and a supercapacitor, a hybrid energy storage system (HESS), which possesses robust power regulation capabilities and rapid response capabilities, holds promise for supporting the frequency stability of power systems. In this context, the assessment of the economic viability of HESSs providing multitype frequency response services becomes a critical factor in their deployment and promotion. In this paper, an economic analysis approach for a Li-ion battery–supercapacitor HESS towards a multitype frequency response is presented. First, a multitype frequency response-oriented operational mode for the HESS is designed, outlining the roles and functions of the Li-ion battery and the supercapacitor in delivering distinct services. Moreover, building upon the analysis of the power trajectory of Li-ion batteries, a lifetime model for the HESS is proposed based on the rain-flow counting method. Furthermore, considering the competitive landscape for the HESS in the frequency regulation ancillary service market, a full lifecycle economic assessment model is proposed. Finally, case studies on actual power system frequency data and PJM market data are performed to verify the effectiveness of the proposed method, and the simulation results confirm that the HESS exhibits robust performance and a competitive advantage in providing multitype frequency response services. Additionally, it demonstrates commendable economic benefits, establishing its potential as a valuable contributor to frequency response services.

DIRECTIONS OF REALIZATION OF THE ORGANIZATIONAL AND ECONOMIC MECHANISM OF FORMATION OF THE ENERGY SECURITY SYSTEM OF UKRAINE: THE ELECTRIC POWER ASPECT

The process of reforming the electricity market has been underway for a long time. The European market liberalization guidelines encourage changes in Ukraine. However, internal contradictions of the domestic market slow down these changes. The basis for these changes is the Law of Ukraine, "On the Electricity Market," adopted in 2017, which lays the foundation for deep reform. This is manifested in the following: all enterprises (producers and suppliers) in the electricity market must operate on separate, self-organized principles; openness and transparency, and free access to the use of networks of all business entities based on public contracts; the law provides for and creates several electricity markets: the intraday market, the balancing market, and the ancillary services market. Each has a separate operating procedure, electricity purchase and sale system, pricing, and the establishment of sales volume standards and quotas. The purpose of the article is to determine the priority areas for implementing the organizational and economic mechanism for the formation of Ukraine's energy security system in the context of the electricity sector. The situation in the electricity market requires significant investments (about USD 25 billion over ten years) to ensure the reliability and continuity of electricity supply. Reform of the electricity market should be based on the following principles: efficiency and transparency of the National Commission for State Regulation of Energy and Public Utilities; separation of electricity generation from distribution; certification of the transmission system operator; updating system, technical, software and information software; optimization of measures and reform of the retail market to meet the needs of consumers; economic justification of pricing to meet the needs and capabilities of consumers, including changes in the cross-subsidization mechanism. Implementing the planned goals and priority areas will help reduce risks in reforming the electricity market, intensify the competitive basis between market participants (entities), create conditions for improving service quality, and limit negative factors' impact on the environment with an incentive pricing policy. The structured structure of the organizational and economic mechanism will allow us to systematize the understanding of the stages of the electricity market functioning. Thus, a unified system of interrelations between the goals of reform, the search for reform methods, sources of financial support, subject and object positions, principles, and methods of their regulation, which directly or indirectly affect the efficiency of the electricity market, will be formed.

Cooperated Bidding of Aggregators to Meet Eligibility Requirements of Ancillary Service Market

Cooperated Bidding of Aggregators to Meet Eligibility Requirements of Ancillary Service Market

Untapping Industrial Flexibility via Waste Heat-Driven Pumped Thermal Energy Storage Systems

Pumped thermal energy storage (PTES) is a promising long-duration energy storage technology. Nevertheless, PTES shows intermediate round-trip efficiency (RTE—0.5 ÷ 0.7) and significant CAPEX. sCO2 heat pumps and power cycles could reduce PTES CAPEX, particularly via reversible and flexible machines. Furthermore, the possibility to exploit freely available heat sources (such as waste heat and/or CSP inputs) could increase RTE, making the system capable of an apparent RTE > 100% as well as reducing CAPEX, avoiding the need for two TES systems. This paper analyses the potential valorization of industrial waste heat (WH) to enhance PTES thermodynamic performance as well as increase industrial energy efficiency, valorizing different levels of WH sources in the 100–400 °C temperature range. In fact, the use of additional heat, otherwise dumped into ambient surroundings, may contribute to avoiding the need for a second TES, thus enhancing plant competitiveness. Starting from an assessment of the most relevant industrial sectors to apply the proposed solution (looking at available WH and electric flexibility needed), this paper analyses the feasibility of a specific sCO2-based PTES case study, where the cycle is integrated into a cement production plant with a WH temperature of around 350 °C. It is demonstrated that the CAPEX of the proposed systems are still relevant and only a robust exploitation of the PTES in the ancillary service market could attract industrial customers’ interest in sCO2 PTES.