Optimal Portfolio Selection Methodology for a Demand Response Aggregator

Pedro Nel Ovalle, José Vuelvas, Arturo Fajardo, Carlos Adrián Correa-Flórez and Fredy Ruiz
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Pedro Nel Ovalle: Department of Electronics Engineering, Pontificia Universidad Javeriana, Bogotá 110321, Colombia
José Vuelvas: Department of Electronics Engineering, Pontificia Universidad Javeriana, Bogotá 110321, Colombia
Arturo Fajardo: Department of Electronics Engineering, Pontificia Universidad Javeriana, Bogotá 110321, Colombia
Carlos Adrián Correa-Flórez: Department of Electronics Engineering, Pontificia Universidad Javeriana, Bogotá 110321, Colombia
Fredy Ruiz: Politecnico di Milano, Dipartimento di Elettronica, Informazione e Bioingegneria, 20133 Milano, Italy

Energies, 2021, vol. 14, issue 23, 1-24

Abstract: This paper presents a methodology for determining the optimal portfolio allocation for a demand response aggregator. The formulation is based on Day-Ahead electricity prices, in which the aggregator coordinates a set of residential consumers that are recruited through contracts. Four types of contracts are analyzed, considering both direct and indirect demand response programs. The objective is to compare different scenarios for contract portfolios in order to establish the benefits of each market agent. An optimization problem is formulated to capture the interactions between the aggregator and end consumers. The model is formulated as a mathematical program with equilibrium constraints: At the upper level, the aggregator maximizes its benefits, whereas the lower level represents the consumers’ contracts. By applying the developed methodology, the characterization of the consumers’ behavior is established in order to forecast their responses to the generation of punctual incentives, both for usual scenarios and peak events, as well as to evaluate the impact that direct and indirect control contracts have on the performance of the aggregator as the energy price varies.

Keywords: demand response; aggregator; consumer behavior; contract portfolio; demand side management (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 (1)

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