Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating Market
The balancing market as a significant part of the spot market addresses fair transaction settlements to eliminate the system imbalances in real time. However, traditional penalty mechanisms that have been also adopted for renewable generators may incur unintended consequences for such intermittent p...
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| Format: | Article |
| Language: | English |
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IEEE
2023-01-01
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| Series: | IEEE Access |
| Subjects: | |
| Online Access: | https://ieeexplore.ieee.org/document/10310216/ |
| _version_ | 1827762440128954368 |
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| author | Homa Rashidizadeh-Kermani Mostafa Vahedipour-Dahraie Mimmo Parente Miadreza Shafie-Khah Pierluigi Siano |
| author_facet | Homa Rashidizadeh-Kermani Mostafa Vahedipour-Dahraie Mimmo Parente Miadreza Shafie-Khah Pierluigi Siano |
| author_sort | Homa Rashidizadeh-Kermani |
| collection | DOAJ |
| description | The balancing market as a significant part of the spot market addresses fair transaction settlements to eliminate the system imbalances in real time. However, traditional penalty mechanisms that have been also adopted for renewable generators may incur unintended consequences for such intermittent producers and even drive them out of the market. Therefore, here a flexible penalty mechanism (FPM) is adopted instead of the traditional policies to decrease the undesired impacts of traditional penalty mechanism (TPM) on the WPP’s revenue. Aligning with the FPM, making a contract between the WPP and the insurance provider in which the system operator (SO) is in charge of system balance is proposed as a remedy instrument to control the risks of wind volatilities. The proposed framework is formulated as a bi-level trilateral problem, in which in the upper level, the WPP maximizes its expected profit and in the lower level, the SO determines the market clearing prices (MCP) and maximizes the social welfare. Due to the importance of forecasting wind power generation, three deep learning algorithms are also used. Simulation results show that by applying FPM, the WPP’s profit improves depending on the contract it signed with the insurance provider while the SO preserves social welfare. |
| first_indexed | 2024-03-11T10:30:42Z |
| format | Article |
| id | doaj.art-6ff66a23a3b1455c8f9fb4fe824be255 |
| institution | Directory Open Access Journal |
| issn | 2169-3536 |
| language | English |
| last_indexed | 2024-03-11T10:30:42Z |
| publishDate | 2023-01-01 |
| publisher | IEEE |
| record_format | Article |
| series | IEEE Access |
| spelling | doaj.art-6ff66a23a3b1455c8f9fb4fe824be2552023-11-15T00:00:59ZengIEEEIEEE Access2169-35362023-01-011112520412521610.1109/ACCESS.2023.333090610310216Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating MarketHoma Rashidizadeh-Kermani0https://orcid.org/0000-0003-2311-4839Mostafa Vahedipour-Dahraie1https://orcid.org/0000-0001-7129-4366Mimmo Parente2https://orcid.org/0000-0002-4935-6003Miadreza Shafie-Khah3https://orcid.org/0000-0003-1691-5355Pierluigi Siano4https://orcid.org/0000-0002-0975-0241Department of Electrical and Computer Engineering, University of Birjand, Birjand, IranDepartment of Electrical and Computer Engineering, University of Birjand, Birjand, IranDepartment of Management and Innovation Systems, University of Salerno, Salerno, ItalySchool of Technology and Innovations, University of Vaasa, Vaasa, FinlandDepartment of Management and Innovation Systems, University of Salerno, Salerno, ItalyThe balancing market as a significant part of the spot market addresses fair transaction settlements to eliminate the system imbalances in real time. However, traditional penalty mechanisms that have been also adopted for renewable generators may incur unintended consequences for such intermittent producers and even drive them out of the market. Therefore, here a flexible penalty mechanism (FPM) is adopted instead of the traditional policies to decrease the undesired impacts of traditional penalty mechanism (TPM) on the WPP’s revenue. Aligning with the FPM, making a contract between the WPP and the insurance provider in which the system operator (SO) is in charge of system balance is proposed as a remedy instrument to control the risks of wind volatilities. The proposed framework is formulated as a bi-level trilateral problem, in which in the upper level, the WPP maximizes its expected profit and in the lower level, the SO determines the market clearing prices (MCP) and maximizes the social welfare. Due to the importance of forecasting wind power generation, three deep learning algorithms are also used. Simulation results show that by applying FPM, the WPP’s profit improves depending on the contract it signed with the insurance provider while the SO preserves social welfare.https://ieeexplore.ieee.org/document/10310216/Electricity marketflexible penalty mechanism (FPM)market clearing price (MCP)wind power producer (WPP) |
| spellingShingle | Homa Rashidizadeh-Kermani Mostafa Vahedipour-Dahraie Mimmo Parente Miadreza Shafie-Khah Pierluigi Siano Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating Market IEEE Access Electricity market flexible penalty mechanism (FPM) market clearing price (MCP) wind power producer (WPP) |
| title | Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating Market |
| title_full | Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating Market |
| title_fullStr | Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating Market |
| title_full_unstemmed | Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating Market |
| title_short | Implementing a Flexible Penalizing Mechanism for Wind Power Producers in the Regulating Market |
| title_sort | implementing a flexible penalizing mechanism for wind power producers in the regulating market |
| topic | Electricity market flexible penalty mechanism (FPM) market clearing price (MCP) wind power producer (WPP) |
| url | https://ieeexplore.ieee.org/document/10310216/ |
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