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Center for Nonlinear Studies |
With the increasing penetration of renewable energies, the power system is being stressed by the great uncertainty from the supply side. On the other hand, with the popularity of electric vehicles and the expansion of data centers, the power system will witness a significant increase of demand in the next decade. Either of these two stresses alone can make the conventional power system collapsed easily. Together, they imply smart grid is a crucial task in the next decade. A naive approach to solve the problems is to directly ask the demand to follow the supply in a centralized control fashion. However, this may not work in practice since each entity in the system pursues its own interest. This motivates us to study the deregulated electricity market for the smart grid from a network economic approach. To ensure a successful market, we investigate two key challenges: efficiency and fairness. To understand the first challenge, we study the ancillary service market. One important challenge with wind DG units is to provide low-cost and fast-responding reactive power compensation of the wind turbine's inductive load to ensure a stable voltage profile in the system. Though STATCOMs have fast enough response time, they are usually expensive and may not be a feasible solution for large-scale deployment of wind DG units. We look at an alternative approach to compensate reactive power of wind DG units: to utilize the the inverter circuits in the charger of PEVs. We consider a scenario where a wind DG unit is co-located with a PEV charging station, and we use game theoretic model to ensure adequate incentives to the PEV owners to actively participate in the market. Our incentive design can achieve the same optimal performance as the centralized control does. To tackle the second challenge - the fairness issue, our goal is to identify and to assess the market power in the deregulated electricity market. This is challenging because congestion fragments the transmission system into smaller zones, behind bottleneck interconnects, and the markets within these zones may be highly concentrated even when the whole transmission system seems competitive. We introduce a novel functional approach to measuring long term market power that unifies a variety of popular market power indices. Our functional approach naturally defines a family of superadditive market power measures and can serve as the guidance for the evolution of the power system.
Host: Michael Chertkov