Coordinated bidding of wind and thermal energy in joint energy and reserve markets of Spain by considering the uncertainties

Kiumars Rahmani and Mehrdad S Nazar

Energy & Environment, 2017, vol. 28, issue 8, 846-869

Abstract: There are several reasons why participants, namely conventional participants, and moreover, wind power producers, have been facing an inevitable uncertainty problem in the current short-term electricity market; one reason is the stochastic nature of market prices, and the other is the wind output power uncertainty. To relive the undesirable effects of these uncertainties on wind energy trading, this research proposes a coordinated bidding of wind and thermal units in day-ahead market, adjustment market and regulation reserve market based on the Iberian Peninsula short-term electricity market rules. In the proposed method, a blended integer stochastic linear programming design maximises the expected profits while controlling the risks. One of the main properties of the developed method is modelling the uncertainty of market expenses and wind output energy. Another feature is considering the conditional value at risk criterion to handle the trading risks. The case study is divided into four specific cases in which different kinds of participation are evaluated. These differences attribute to the bidding in various market types. Simulation results indicate that coordinated bidding in the regulation reserve market has more advantages over coordinated bidding in the adjustment market. Furthermore, participation in both adjustment market and regulation reserve market leads to a dramatic decrease in likely deviations in the regulation reserve market, and as a result, coordination advantages become less effective.

Keywords: Electricity market; coordinated bidding; wind unit; thermal units (search for similar items in EconPapers)
Date: 2017
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Persistent link: https://EconPapers.repec.org/RePEc:sae:engenv:v:28:y:2017:i:8:p:846-869

DOI: 10.1177/0958305X17736001

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