Energy Storage as a Service: Optimal Pricing for Transmission Congestion Relief
This paper focuses on pricing Energy Storage as a Service (ESaaS) for Transmission congestion relief (TCR). We consider a merchant storage facility that competes in an electricity market to trade energy and ancillary services on a day-to-day basis. The facility also has the opportunity to provide a...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
| Published: |
IEEE
2020-01-01
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| Series: | IEEE Open Access Journal of Power and Energy |
| Subjects: | |
| Online Access: | https://ieeexplore.ieee.org/document/9224845/ |
| _version_ | 1818562794000220160 |
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| author | Juan Arteaga Hamidreza Zareipour Nima Amjady |
| author_facet | Juan Arteaga Hamidreza Zareipour Nima Amjady |
| author_sort | Juan Arteaga |
| collection | DOAJ |
| description | This paper focuses on pricing Energy Storage as a Service (ESaaS) for Transmission congestion relief (TCR). We consider a merchant storage facility that competes in an electricity market to trade energy and ancillary services on a day-to-day basis. The facility also has the opportunity to provide a firm TCR service to a regional network operator under a long-term contract. Providing the additional TCR service would impose limitations on the facility's ability to fully harvest daily market trade opportunities. Thus, we model the opportunity costs associated with the TCR service and use it in a hybrid cost-value customized pricing technique to determine the risk-constrained optimal price of ESaaS for TCR. Given the long-term nature of the commitment to provide the TCR service, we use the Conditional Value at Risk (CVaR) metric to mitigate the long-term financial risks faced by the facility. The proposed pricing strategy enables the storage owner to estimate the additional financial gains and the associated risks that would likely result from adding the new service to its operation. Numerical simulations are provided to support the proposed methodology. |
| first_indexed | 2024-12-14T01:08:24Z |
| format | Article |
| id | doaj.art-d0e3e5aedae842409cf29c3486a09573 |
| institution | Directory Open Access Journal |
| issn | 2687-7910 |
| language | English |
| last_indexed | 2024-12-14T01:08:24Z |
| publishDate | 2020-01-01 |
| publisher | IEEE |
| record_format | Article |
| series | IEEE Open Access Journal of Power and Energy |
| spelling | doaj.art-d0e3e5aedae842409cf29c3486a095732022-12-21T23:22:52ZengIEEEIEEE Open Access Journal of Power and Energy2687-79102020-01-01751452310.1109/OAJPE.2020.30315269224845Energy Storage as a Service: Optimal Pricing for Transmission Congestion ReliefJuan Arteaga0https://orcid.org/0000-0002-6565-0894Hamidreza Zareipour1https://orcid.org/0000-0003-2889-0386Nima Amjady2https://orcid.org/0000-0003-1308-1738University of Calgary, Calgary, AB, CanadaUniversity of Calgary, Calgary, AB, CanadaElectrical Engineering Department, Semnan University, Semnan, IranThis paper focuses on pricing Energy Storage as a Service (ESaaS) for Transmission congestion relief (TCR). We consider a merchant storage facility that competes in an electricity market to trade energy and ancillary services on a day-to-day basis. The facility also has the opportunity to provide a firm TCR service to a regional network operator under a long-term contract. Providing the additional TCR service would impose limitations on the facility's ability to fully harvest daily market trade opportunities. Thus, we model the opportunity costs associated with the TCR service and use it in a hybrid cost-value customized pricing technique to determine the risk-constrained optimal price of ESaaS for TCR. Given the long-term nature of the commitment to provide the TCR service, we use the Conditional Value at Risk (CVaR) metric to mitigate the long-term financial risks faced by the facility. The proposed pricing strategy enables the storage owner to estimate the additional financial gains and the associated risks that would likely result from adding the new service to its operation. Numerical simulations are provided to support the proposed methodology.https://ieeexplore.ieee.org/document/9224845/Energy storage as a service (ESaaS)transmission congestion reliefstorage as transmission asset (SATA) |
| spellingShingle | Juan Arteaga Hamidreza Zareipour Nima Amjady Energy Storage as a Service: Optimal Pricing for Transmission Congestion Relief IEEE Open Access Journal of Power and Energy Energy storage as a service (ESaaS) transmission congestion relief storage as transmission asset (SATA) |
| title | Energy Storage as a Service: Optimal Pricing for Transmission Congestion Relief |
| title_full | Energy Storage as a Service: Optimal Pricing for Transmission Congestion Relief |
| title_fullStr | Energy Storage as a Service: Optimal Pricing for Transmission Congestion Relief |
| title_full_unstemmed | Energy Storage as a Service: Optimal Pricing for Transmission Congestion Relief |
| title_short | Energy Storage as a Service: Optimal Pricing for Transmission Congestion Relief |
| title_sort | energy storage as a service optimal pricing for transmission congestion relief |
| topic | Energy storage as a service (ESaaS) transmission congestion relief storage as transmission asset (SATA) |
| url | https://ieeexplore.ieee.org/document/9224845/ |
| work_keys_str_mv | AT juanarteaga energystorageasaserviceoptimalpricingfortransmissioncongestionrelief AT hamidrezazareipour energystorageasaserviceoptimalpricingfortransmissioncongestionrelief AT nimaamjady energystorageasaserviceoptimalpricingfortransmissioncongestionrelief |