Energy Storage for Power System Planning and Operation

4Refined Bidding and Operating Strategy for a Renewable Energy Generation and Energy Storage System Union

4.1 Introduction

In last chapter, it was shown that the energy storage system (ESS) can be coordinated with renewable energy generation (REG) in a day‐ahead electricity market to increase the total revenue of the REG–ESS union. Some published research works assumed that the role of ESS in the union was to compensate for deviations from a predefined operation schedule and to smooth power output in a real‐time operation [1, 2]. They overlooked the opportunity of optimizing market participation by optimally foreseeing how ESS could jointly accommodate deviations from schedule and perform arbitrage. To prevent ESS from charging at high‐price periods and discharging at low‐price periods when balancing deviations, a strategy was introduced in Chapter 3 that embeds the balancing strategy into day‐ahead optimization and can effectively increase the revenue of the REG–ESS union. These methods focus more on REG power deviations, while they are not very sensitive to balancing prices. In contrast, if aiming to integrate complicated real‐time control strategies into day‐ahead offering/bidding optimization, methods such as stochastic dynamic programming may suffer from very heavy computing efforts. Linear decision rules permit decisions to be defined through affine transformation of realizations of uncertain parameters [3], hence keeping computational costs low. In this chapter, linear ...