Optimal bidding and offering strategies of compressed air energy storage: A hybrid robust-stochastic approach

Wei Cai, Rasoul Mohammaditab, Gholamreza Fathi, Karzan Wakil, Abdol Ghaffar Ebadi and Noradin Ghadimi

Renewable Energy, 2019, vol. 143, issue C, 1-8

Abstract: Market players face electricity market price uncertainty as a challenging issue in restructured electricity markets. To overcome this problem, taking optimal bidding and offering strategies is very important. This paper proposes a new mathematical model as a hybrid robust-stochastic method in order to maximize the expected profit of a compressed air energy system. Also, this study considers the uncertainty of market price with a set of scenarios via stochastic method while it models the uncertainty of maximum capacity of cavern via robust optimization approach. Furthermore, the proposed model formulates mixed-integer linear programming and obtains optimal offering and bidding curves of a compressed air energy system, which are robust against the uncertainty associated with market price and cavern uncertainty. Obtained results show that total profit, without considering cavern’s uncertainty, is equal to $9585 while this amount for the most robust case obtained as $8753. This means that being robust against the maximum capacity of caver’s uncertainty reduces total profit by about 8.68%.

Keywords: Compressed air energy system; Hybrid robust-stochastic approach; Bidding and offering strategies; Market price uncertainty (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (28)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:143:y:2019:i:c:p:1-8

DOI: 10.1016/j.renene.2019.05.008

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