Argonne National Laboratory

Dynamic Scheduling of Operating Reserves in Co-Optimized Electricity Markets with Wind Power

Title Dynamic Scheduling of Operating Reserves in Co-Optimized Electricity Markets with Wind Power
Publication TypeJournal Article
Year of Publication2013
AuthorsZhou, Z, Botterud, A
JournalIEEE Transactions on Power Systems
Volume29
Start Page160
Issue1
Pagination11
Date Published09252013
ISSN0885-8950
Keywordsdemand curves, electricity markets, operating reserves, probabilistic forecasting, wind power
Abstract

We propose a probabilistic methodology to estimate a demand curve for operating reserves, where the curve represents the amount that a system operator is willing to pay for these services. The demand curve is quantified by the cost of unserved energy and the expected loss of load, accounting for uncertainty from generator contingencies, load forecasting errors, and wind power forecasting errors. The methodology addresses two key challenges in electricity market design: integrating wind power more efficiently and improving scarcity pricing. In a case study, we apply the proposed operating reserve strategies in a two-settlement electricity market with centralized unit commitment and economic dispatch and co-optimization of energy and reserves. We compare the proposed probabilistic approach to traditional operating reserve rules. We use the Illinois power system to illustrate the efficiency of the proposed reserve market modeling approach when it is combined with probabilistic wind power forecasting.

DOI10.1109/TPWRS.2013.2281504