Demand Response Application by Strategic Wind Power Producers
This paper considers a wind power producer playing strategically in a day ahead market while willing to set demand response (DR) contracts with a DR aggregator. To this end, a bilevel problem including a single leader and two followers is formulated. The wind power producer is the leader aiming at maximizing its profit through offering into a day ahead market and clearing its deviation in a balancing market. The strategic behavior of the producer in the day ahead market is modeled through the market clearing process (follower 1) In addition, the DR aggregator behavior is modeled through a revenue function in which the aggregator is able to sell its DR product to the wind power producer, other competitors and the day ahead market (follower 2) The overall problem is a stochastic mathematical program with equilibrium constraints (MPEC) in which wind power production and imbalance prices are associated with uncertainty. The problem is then transformed into a linear programming approach. A case of the Nordic market is chosen to assess the validity of the given problem.
IEEE Transactions on Power Systems