Modeling Strategic Behaviors of Renewable Energy With Joint Consideration on Energy and Tradable Green Certificate Markets

• Published in: IEEE transactions on power systems Vol. 35; no. 3; pp. 1898 - 1910
• Main Authors: Guo, Hongye, Chen, Qixin, Xia, Qing, Kang, Chongqing
• Format: Journal Article
• Language: English
• Published: New York IEEE 01.05.2020; The Institute of Electrical and Electronics Engineers, Inc. (IEEE)
• Subjects: Alternative energy sources; Analytical models; Clean energy; Decision analysis; Duality theorem; Economic conditions; Electricity Market; Generators; Green products; Investment; Market Equilibrium; Mathematical Problem with Equilibrium Constraints (MPEC); Power systems; Renewable energy; Renewable energy sources; Renewable resources; Strategic Behavior; Tradable Green Certificate; Uncertainty
• ISSN: 0885-8950; 1558-0679
• DOI: 10.1109/TPWRS.2019.2953114

Renewable energy will become a normal energy source and will be required to participate in the market. The renewable portfolio standards (RPS) together with tradable green certificates (TGC) are considered as an appropriate market mechanism to help recover renewable energy investments. The strategic offering behaviors of renewable energy should be carefully studied, especially with the introduction of TGC. This paper proposed a market equilibrium model with joint consideration on energy and TGC. The model includes two-stages of day-ahead and real-time analysis, to formulate the complex decision processes of strategic renewable energy. The model is built in a bilevel format, with multiple-scenario settings to consider the uncertainty of renewable power output within a day. Then, the bilevel model is reformulated as a single-level nonlinear problem based on KKT theorems. Then, the nonlinearities are linearized based on the strong duality theorem and a binary expansion method. The model has been finally transformed as a mix integer linear problem. Finally, an illustrative example is proposed to analyze the strategic offering behaviors of renewable energy under various market situations.