Planning the presence of virtual power plant in the electricity market considering electric cars

A master's thesis in the field of electrical-power engineering

1-1- Introduction

In traditional systems, reasons such as the dependence of different parts of the electricity industry including production, transmission and distribution on each other, the need for large investments in different parts of this industry and society's expectation from governments to provide electricity as a public duty and service had caused this The industry should be established integrally with government investment. In recent years, with the trend of this industry towards privatization and becoming more competitive, the discussion of restructuring the power systems has been raised, in which different parts of the electricity industry operate privately and independently of each other.      

1-2- Reasons for restructuring

According to economic theories, in an ideal market and in the best conditions, social welfare and public satisfaction are achieved and the price of the produced product will be equal to the marginal cost of that product. The experience of the world has shown that it is not so easy to reach such conditions. Electric energy, unlike other market goods, cannot be stored and must be supplied directly, and problems such as network stability and network security issues are also very important. However, with the proper design of the structure, we can move towards such a goal. For this purpose, a new approach in recent years has considered electricity as a commodity that can be exchanged like other commodities, and it is implemented in a certain framework by maintaining the security and stability of the privatization discussion network, and legal powers are given to the participants in the electricity market. In general, some of the reasons for moving towards restructuring are as follows: [1-3]

compensation of investment deficits by the public sector

faster growth and expansion of electricity networks

increasing productivity

transparency of costs

Decreasing government ownership and increasing private investment

1-3- Exchanges in the electricity market

As it was said, one of the most important conditions for a successful market is the observance of justice among market participants. By respecting justice and creating healthy competition, credit is created for investment by private production companies.

1-3-1- How to trade in the power pool

In the power pool model, the basis of work is that sellers or producers in the energy market offer their products in accordance with the energy sales curve in the next 24 hours, and buyers can participate in the market by providing a price for purchase.

1-3-2- Market settlement methods

As stated, network security, cost reduction and restrictions such as power plant unit limitations, transmission limitations due to line congestion, etc. It causes that the final selected producers to produce in the market, based on the initial results of the market tender or the priority of the price offer, are not lower, therefore, in advanced markets, the power grid is divided into smaller regions or regions and the market is settled for that region. In general, there are three methods of price settlement in the market, which are: uniform market price, regional market price, and nodal market price [4-6]. Each of these methods is fully explained in the mentioned sources and we avoid repeating it here.

1-4- Sources of uncertainty

The factors that create uncertainty or in other words the sources of uncertainties can be divided into the following two general groups:

1-4-1- Inherent uncertainty

As it is clear from the name of this uncertainty, it is caused by the incomprehensible and unknown nature and essence of the system or phenomenon. For example, the amount of water flowing from a river is a random phenomenon that changes with time.

1-4-2- Uncertainty caused by lack of awareness and necessary knowledge

This type of uncertainty is caused by lack of information, lack of awareness and necessary knowledge about the desired phenomenon or system, and uncertainty can be reduced by increasing the range of awareness and information. In the references [7, 8] sources of creating uncertainties such as measurement, expression, system understanding, random processes, decisions, forecasting and so on. And also the method of dealing with them has been stated in a comprehensive and practical way, which is mentioned below:

Measuring new information

Transferring concepts, interpretation or translation of information

Not recognizing the meaning of the system

1-4-3-Methods of dealing with uncertainty

Sensitivity analysis[1]

Fuzzy logic[2]

System monitoring[3]

Scenario analysis[4]

Qualitative analysis[5]

1-4-4- Uncertainties in the electricity market

In traditional power systems, there are many uncertainties that are not very predictable and may cause various problems for the network and participants. It can be said that uncertainties in traditional power systems [6] are less compared to restructured systems because in traditional power systems the entire network is under government supervision and the goal is to provide electricity to consumers away from economic issues and competition between different participants. In the electricity market, there are many companies that produce, transmit and It is true that all these participants have the right to make decisions based on their maximum profit, so it can be said that there is uncertainty in the behavior and performance (strategy) of competitors based on the number of participants in the electricity market, which indicates the high complexity of the electricity market compared to traditional power systems.

  It may be that the discussion is about how to offer to buy or sell. The second strategy is the design and development of the market, and in this case, the participants, according to the different market conditions, willingness to take risks, and other things, invest in the market with a guaranteed profit and in different parts of the market, such as the construction of power plants, transmission lines, distribution and super distribution, etc. 

Reference [9] has stated the most important uncertainties in the electricity market. Considering that in various sources, other cases are mentioned as uncertainties in electricity markets, the important and main cases can be summarized as follows:

Uncertainty of energy prices in the market

Uncertainty of reservation and auxiliary services in the market

Uncertainty of load

Uncertainty of fuel In the market

Uncertainty caused by congestion in energy transmission lines

Uncertainty in energy production (output or production rate of units)

1-4-4-1- Uncertainty caused by fuel

In using fuel to produce energy in units, various uncertainties are created that It is mainly due to the privateness of production conditions. Although in some markets there is a limit for minimum production, but the lack of access to fuel or the cost of the required fuel in comparison with the amount of income, makes production companies make different decisions based on their profit and benefit in production or even non-production (even by paying a fine). Fuel uncertainty is caused by two parts:

- Access or lack of access to fuel

- Fuel price uncertainty

In reference [10] it is stated that the production of fuel and coal in Chile is very small and this country only has very few oil resources, and this amount of crude oil available is less than 20% of the national demand and the main share of oil is provided by foreign companies. This causes great uncertainties on the part of fuel