Leveraging P90 Requirement: Flexible Resources Bidding in Nordic Ancillary Service Markets

The P90 requirement of the Danish transmission system operator, Energinet, incentivizes flexible resources with stochastic power consumption/production baseline to bid in Nordic ancillary service markets with the minimum reliability of 90%, i.e., letting them cause reserve shortfall with the probabi...

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Bibliographic Details
Main Authors: Gade, Peter A.V., Bindner, Henrik W., Kazempour, Jalal
Format: Conference Proceeding
Language:English
Subjects:
ancillary services
bidding strategy
Computers
distributionally robust joint chance-constrained optimization
Electric vehicles
Optimization
Optimization models
Portfolios
Power demand
Procurement
Robustness
Smart grids
Stochastic flexible resources
Stochastic processes
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Summary:The P90 requirement of the Danish transmission system operator, Energinet, incentivizes flexible resources with stochastic power consumption/production baseline to bid in Nordic ancillary service markets with the minimum reliability of 90%, i.e., letting them cause reserve shortfall with the probability of up to 10%. Leveraging this requirement, we develop a distributionally robust joint chance-constrained optimization model for aggregators of flexible resources to optimize their volume of reserve capacity to be offered. Having an aggregator of electric vehicles as a case study, we show how distributional robustness is key for the aggregator when making bidding decisions in a non-stationary uncertain environment. We also develop a heuristic based on a grid search for the system operator to adjust the P90 requirement and the level of conservativeness, aiming to procure the maximum reserve capacity from stochastic resources with least expected shortfall.
ISSN:2474-2902
DOI:10.1109/SmartGridComm60555.2024.10738114