Operation Strategy of Multi-Virtual Power Plants Participating in Joint Electricity–Carbon Market Based on Carbon Emission Theory

Jiahao Zhou, Dongmei Huang (), Xingchi Ma and Wei Hu
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Jiahao Zhou: School of Electric Engineering, Shanghai University of Electric Power, Shanghai 200090, China
Dongmei Huang: School of Electric Engineering, Shanghai University of Electric Power, Shanghai 200090, China
Xingchi Ma: School of Energy and Mechanics, Shanghai University of Electric Power, Shanghai 200090, China
Wei Hu: School of Economics and Management, Shanghai University of Electric Power, Shanghai 200090, China

Energies, 2025, vol. 18, issue 11, 1-30

Abstract: The global energy transition is accelerating, bringing new challenges to power systems. A high penetration of renewable energy increases grid volatility. Virtual power plants (VPPs) address this by dynamically responding to market signals. They integrate renewables, energy storage, and flexible loads. Additionally, they participate in multi-tier markets, including energy, ancillary services, and capacity trading. This study proposes a load factor-based VPP pre-dispatch model for optimal resource allocation. It incorporates the coupling effects of electricity–carbon markets. A Nash negotiation strategy is developed for multi-VPP cooperation. The model uses an accelerated adaptive alternating-direction multiplier method (AA-ADMM) for efficient demand response. The approach balances computational efficiency with privacy protection. Revenue is allocated fairly based on individual contributions. The study uses data from a VPP dispatch center in Shanxi Province. Shanxi has abundant wind and solar resources, necessitating advanced scheduling methods. Cooperative operation boosts profits for three VPPs by CNY 1101, 260, and 823, respectively. The alliance’s total profit rises by CNY 2184. Carbon emissions drop by 31.3% to 8.113 tons, with a CNY 926 gain over independent operation. Post-cooperation, VPP1 and VPP2 see slight emission increases, while VPP3 achieves major reductions. This leads to significant low-carbon benefits. This method proves effective in cutting costs and emissions. It also balances economic and environmental gains while ensuring fair profit distribution.

Keywords: virtual power plant; joint electricity and carbon trading; cooperative game; load pretreatment; Nash negotiation (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: 2025
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