Abstract
Distribution-level electricity market provides a platform for trading energy and grid services from large-amount of small-scale distributed energy resources (DERs) located on distribution grids. The behavior of the DERs in the distribution electricity market may ultimately impact the market-clearing and locational marginal prices (LMPs) in the wholesale market. This paper proposes a bi-level optimization model for distribution market clearing and distribution locational marginal pricing (DLMP) considering the interactions between distribution and transmission wholesale markets. In the proposed model, the upper-level model represents the distribution system operator (DSO) market-clearing and the lower-level model represents the wholesale market-clearing by the independent system operator (ISO). The LMP at the substation will impact the DER dispatch and power demands of the DSO as well as the DLMP. In turn, the power demands of the DSO will further impact the ISO market and its LMPs. The equilibrium problem with equilibrium constraints (EPEC) approach is applied to find the equilibria of multiple DSOs and the ISO. The EPEC problem is transformed into a single-level mixed-integer convex problem in order to allow for efficient solving. The effectiveness of the proposed model and solution method are demonstrated through case studies.
Original language | English |
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Article number | 9360655 |
Pages (from-to) | 3150-3162 |
Number of pages | 13 |
Journal | IEEE Transactions on Smart Grid |
Volume | 12 |
Issue number | 4 |
DOIs | |
State | Published - Jul 2021 |
Funding
Manuscript received April 19, 2020; revised September 2, 2020 and January 12, 2021; accepted January 16, 2021. Date of publication February 22, 2021; date of current version June 21, 2021. This work was supported in part by the National Natural Science Foundation of China under Grant 52077028, Grant 52007026, Grant 51877033, and Grant 52061635103; and in part by the University of North Carolina at Charlotte. Paper no. TSG-00587-2020. (Corresponding authors: Linquan Bai; Tao Jiang).
Funders | Funder number |
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University of North Carolina at Charlotte | TSG-00587-2020 |
National Natural Science Foundation of China | 52007026, 52061635103, 51877033, 52077028 |
Keywords
- Bi-level optimization
- EPEC
- MPEC
- distribution market
- pricing