Framework for Deterministic Assessment of Risk-Averse Participation in Local Flexibility Markets †

Carlo Schmitt, Felix Gaumnitz, Andreas Blank, Olivier Rebenaque, Théo Dronne, Arnault Martin, Philippe Vassilopoulos, Albert Moser and Fabien Roques
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Carlo Schmitt: Institute for High Voltage Equipment and Grids, Digitalization and Energy Economics (IAEW), RWTH Aachen University, 52062 Aachen, Germany
Felix Gaumnitz: Institute for High Voltage Equipment and Grids, Digitalization and Energy Economics (IAEW), RWTH Aachen University, 52062 Aachen, Germany
Andreas Blank: Institute for High Voltage Equipment and Grids, Digitalization and Energy Economics (IAEW), RWTH Aachen University, 52062 Aachen, Germany
Olivier Rebenaque: LEDa, University Paris-Dauphine, University PSL, CGEMP, CNRS, 75016 Paris, France
Théo Dronne: LEDa, University Paris-Dauphine, University PSL, CGEMP, CNRS, 75016 Paris, France
Arnault Martin: EPEX SPOT SE, 75002 Paris, France
Philippe Vassilopoulos: EPEX SPOT SE, 75002 Paris, France
Albert Moser: Institute for High Voltage Equipment and Grids, Digitalization and Energy Economics (IAEW), RWTH Aachen University, 52062 Aachen, Germany
Fabien Roques: LEDa, University Paris-Dauphine, University PSL, CGEMP, CNRS, 75016 Paris, France

Energies, 2021, vol. 14, issue 11, 1-34

Abstract: Local flexibility markets (LFMs) are a market-based concept to integrate distributed energy resources into congestion management. However, the activation of flexibility for storage-based flexibility changes the respective state of charge. Compensation in later points of time is needed to regain the original flexibility potential. Therefore, we propose a LFM bid formulation including both flexibility and compensation. Furthermore, flexibility market participation might lead to inc-dec-gaming, i.e., congestion-increasing behavior to maximize profits. However, this inc-dec-gaming might lead to electricity market schedule deviations if LFM offers are not activated. We propose a risk-averse modeling formulation considering the potential non-activation of LFM bids to provide a framework for the assessment of LFM participation comparing different approaches. Our exemplary case studies demonstrate the proposed LFM bid formulation and show the impact of LFM participation modeling on inc-dec-gaming and congestion management costs.

Keywords: local flexibility markets; congestion management; operational planning; storage systems (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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