A system operator's utility function for the frequency response market
File(s)
Author(s)
Greve, Thomas
Teng, Fei
Pollitt, Michael G
Strbac, Goran
Type
Journal Article
Abstract
How can the electricity system operator determine the optimal quantity and quality of electricity ancillary services (such as frequency response) to procure in a market increasingly characterized by intermittent renewable electricity generation? The paper presents a system operator’s utility function to calculate the exchange rates in monetary values between different frequency response products in the electricity system. We then use the utility function in a two-sided Vickrey-Clarke-Groves (VCG) mechanism combined of two frequency response products – enhanced and primary – in the context of the system in Great Britain. This mechanism would allow the market to reveal to the system operator the welfare optimal mix of speed of frequency response and quantity to procure. We show that this mechanism is the efficient way to support new faster sources of frequency response, such as could be provided by grid scale batteries.
Date Issued
2018-12-01
Date Acceptance
2018-09-08
Citation
Applied Energy, 2018, 231, pp.562-569
ISSN
0306-2619
Publisher
Elsevier
Start Page
562
End Page
569
Journal / Book Title
Applied Energy
Volume
231
Copyright Statement
© 2018 Elsevier Ltd. All rights reserved. This manuscript is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International Licence http://creativecommons.org/licenses/by-nc-nd/4.0/
Sponsor
Engineering & Physical Science Research Council (EPSRC)
Identifier
http://gateway.webofknowledge.com/gateway/Gateway.cgi?GWVersion=2&SrcApp=PARTNER_APP&SrcAuth=LinksAMR&KeyUT=WOS:000452345400042&DestLinkType=FullRecord&DestApp=ALL_WOS&UsrCustomerID=1ba7043ffcc86c417c072aa74d649202
Grant Number
EP/K002252/1
Subjects
Science & Technology
Technology
Energy & Fuels
Engineering, Chemical
Engineering
Utility function
Ancillary services
System operator
Energy storage
VCG mechanism
STORAGE-SYSTEMS
ENERGY
DESIGN
Publication Status
Published
Date Publish Online
2018-09-22