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At least 145 records · Page 8

Exploiting electricity market dynamics using flexible electrolysis units for retrofitting methanol synthesis

Here we investigate the economic viability of integrating flexible electrolysis units to produce hydrogen in methanol synthesis processes. Specifically, we investigate whether this approach can help reduce methanol production costs by strategically exploiting dynamics of electricity markets. Our study integrates high-fidelity process simulations, optimization tools, and microkinetic modeling (informed by density functional theory) to conduct detailed techno-economic analyses and to compare performance against traditional processes that use hydrogen produced via steam-methane reforming (SMR). We also use this approach to estimate the levelized cost of hydrogen (LCOH) as a function of time-varying electricity prices (from day-ahead and real-time prices) and of key techno-economic parameters. Our results show that the proposed electrification framework is cost-competitive under certain electricity market conditions. Specifically, we find that, when the electrolysis system is operated in flexible mode (and can respond to dynamics of electricity markets), the associated electricity cost nearly collapses to zero. Conversely, when the unit is not flexible (and cannot respond to markets), the electricity cost comprises 60% of the total cost. Our results also reveal that the LCOH of the flexible electrolysis system participating in real-time electricity markets is 31% lower than the LCOH obtained from SMR. Overall, this indicates that exploiting the dynamics of electricity markets can make hydrogen production cost-competitive and this can lead to viable alternatives to electrify methanol production and other hydrogen-based processes.

29 ENERGY PLANNING, POLICY, AND ECONOMY↗

Rethinking the Price Formation Problem–Part 1: Participant Incentives under Uncertainty

Operators of organized wholesale electricity markets attempt to form prices in such a way that the private incentives of market participants are consistent with a socially optimal commitment and dispatch schedule. In the U.S. context, several competing price formation schemes have been proposed to address the non-convex production cost functions characteristic of most generation technologies. Here, this paper considers how the design and analysis of price formation policies for non-convex markets are affected by the uncertainty inherent in electricity demand and supply. We argue that by excluding uncertainty, the analytical framework underlying existing policies mischaracterizes the incentives of market participants, leading to inefficient price formation and poor incentives for flexibility. We establish favorable theoretical properties of a new construct, ex ante convex hull pricing , and demonstrate the difference between this idealized benchmark and existing methods on a large-scale test system. Given increased operational uncertainty with a transition to wind and solar generation, distortions caused by poor incentives for flexibility are likely to grow without improved price formation in organized wholesale markets.

24 POWER TRANSMISSION AND DISTRIBUTION↗

A Novel Framework for Optimizing Ramping Capability of Hybrid Energy Storage Systems

Hybrid Energy Storage System has been widely applied in aerospace, electric vehicle, and microgrid applications. The advantages are that they include complimentary technologies with both high power and energy capabilities. HESS have the potential to be useful to the bulk power systems, for example to increase the value of energy produced by variable generation resource through enabling participation in ancillary service markets. Actualizing the benefits of HESSs requires optimizing the combined ramping capability of aggregated HESS resources. To provide quality ancillary service, source of HESSs locating at multiple sites of variable generation resource must be optimally sized and cohesively controlled. Optimizing aggregated resources can be formulated as an optimization problem. Successfully solving this problem not only requires using effective solution methods but also depends on accurately and rapidly setting the necessary parameters in the problem formula. This article proposes a novel framework with double-layer structure to solve the optimization problem of aggregating ramping capability. Program developed on the upper layer focuses on solving the optimization of aggregating ramping capability among multiple HESSs and is compatible with most existing optimization algorithms. Program on lower layer of the framework targets at optimizing the local control of a single HESS based on a thorough analytics of HESS operation strategy presented in this article. Result of local optimization is also provided to upper layer program for updating the parameters in formula of optimization problem. Real time hardware-in-the-loop test is conducted to verify the performance of the optimization framework developed. The work presented is expected to provide guidance for implementing this framework in practical operation.

Luo, Yushen↗

Economic Analysis of Integrated Solar Power, Hydrogen Production, and Electricity Markets

Hydrogen is a versatile energy carrier that is used in a wide variety of chemical and industrial processes. Producing hydrogen using electrolysis can enable integration of multiple sectors including electricity, heating, and industrial sectors; however, the cost of producing hydrogen from electrolysis remains a challenge for encouraging greater adoption. To help improve the economics for both solar PV and hydrogen production using electrolyzers, we explore the benefit of combining PV and electrolysis systems. Using the Revenue Operation and Device Optimization Model (RODeO) model, the optimal breakeven hydrogen production cost for six unique market participation configurations is calculated at six candidate locations in California where PV is already installed. Costs include production, storage, and compression in preparation for gaseous delivery trucks. Revenue streams included in the optimization are the sale of hydrogen, Low Carbon Fuel Standard (LCFS) credits, renewable electricity sold to the grid, and Renewable Energy Credits (REC). The costs included are the electricity costs, capital and fixed operation and maintenance cost (FOM) for the electrolyzer, PV, and storage and compression systems as well as taxes and financing costs. In addition, cost reductions are achieved through retail and wholesale electricity use optimization, by which electricity is purchased at the lowest price and sold, if possible, at the highest price. For all locations analyzed, the breakeven hydrogen production cost results show that, in order of decreasing cost, the system configurations are islanded (highest), separated, NEM, retail, hybrid retail/wholesale, and wholesale (lowest). This report also explores other aspects of hydrogen systems including optimal renewable sizing and resulting energy mixture to the electrolyzer, value of renewable premiums, competition with incumbent technologies, cost sensitivity to a variety of parameters.

decarbonized economy↗

Transactive Electric Vehicle Agent: Design and Performance Evaluation

Transactive electric vehicle (TEV) agent enables the utilization of EVs’ flexible resources for the benefits of both utility and customer by active market participation. In this work, we propose a novel TEV agent optimization with a novel slider feature that models an individual customer’s willingness to participate in the transactive market. We characterize the customer comfort in EV’s context using a slider that provides flexibility to the customer to choose a trade-off between comfort and profit. Finally, the proposed optimization framework is used to investigate the comparative benefits of V2G technology compared to V1G.

day-ahead electricity market, electric vehicle, fl↗

Equitable Transactive Market Design to Coordinate Networked Microgrids with Mixed Ownership

This paper presents an inter-microgrid peer-topeer (P2P) transactive market mechanism to support the coordination of multiple microgrids in a mixed-ownership environment, while enabling prosumers to actively participate in the market to get their own benefits. An equitable P2P transactive energy market is designed, in which the energy burden to customers within microgrids is fairly distributed by leveraging a peer-to-peer communication network among MG owners and the distribution system operator (DSO). To reach the market settlement, a consensus-based distributed optimization algorithm is introduced to enable each MG owner and the DSO to distributedly determine the cleared price which is compensated by a household-income-based discount factor to encourage the energy-burden equity among customers in networked microgrids service territory. Numerical results on the modified 123 node test feeder including 6 microgrids are used to demonstrate the operation of the introduced equitable transactive energy market.

Vu, Thanh Long↗

Optimization Framework to Assess the Demand Response Capacity of a Water Distribution System

As large electricity consumers, water distribution system (WDS) pumping stations have the potential to become meaningful participants in demand response (DR) programs. The authors propose an optimization framework for assessing the DR capacity of a WDS and identifying the optimal bidding strategy for maximizing WDS revenue in the DR spot market. The proposed mixed integer linear programming (MILP) model overcomes computational constraints of previous DR optimization models by adopting a preprocessing procedure to minimize the number of binary variables and implementing a convex relaxation technique to linearize the hydraulic equations. The proposed MILP model also explicitly accounts for varying levels of risk tolerance of WDS operators by varying the recovery period over which pumping returns to business-as-usual operation. The optimization framework is implemented on a skeletonized 48-node WDS model that includes 7 pumps, 6 tanks, and 39 pipes. Using a simulated DR event and water consumption profile, the authors derive the optimal DR supply curves (i.e., compensation price versus load curtailment quantity) and revenue potential of the WDS under six scenarios for DR participation.

32 ENERGY CONSERVATION, CONSUMPTION, AND UTILIZATI↗

Beyond Price-Taker: Multiscale Optimization of Wind and Battery Integrated Energy Systems

Integrating renewable energy into the electric grid is challenging due to the intermittency and variability of wind and other non-dispatchable resources. Integrated energy systems (IESs) combine multiple energy technologies (e.g., fossil, nuclear, renewables, storage) to reduce costs and improve flexibility and reliability. However, standard techno-economic analysis (TEA) methods often overestimate the benefits of IESs because they fail to account for energy market adjustments. This paper systematically studies the limitations of the prevailing price-taker assumption for TEA and optimization of hybrid energy systems. As an illustrative case study, we retrofit an existing wind farm in the RTS-GMLC test system (which loosely mimics the Southwest U.S.) with battery energy storage to form an IES. We show that the standard price-taker model overestimates the electricity revenue and the net present value (NPV) of the IES up to 178% and 30.4%, respectively, compared to our more rigorous multiscale optimization. These differences arise because introducing storage creates a more flexible resource that impacts the larger wholesale electricity market. Moreover, this work highlights the impact of the IES has on the market via various strategic bidding, and underscores the importance of moving beyond price-taker for optimal storage sizing and TEA of IESs. We conclude by discussing opportunities to generalize the proposed framework to other IESs, and highlight emerging research questions regarding the complex interactions between IESs and markets.

25 ENERGY STORAGE↗

HBMax: Optimizing Memory Efficiency for Parallel Influence Maximization on Multicore Architectures

The goal of influence maximization is to select k most-influential vertices or seeds in a network, where influence is defined by a given diffusion process. The problem has a number of important applications such as viral marketing, information spread, and epidemic control. Although computing optimal seed set is NP-Hard, due to the submodular nature of the problem efficient approximation algorithms exist. However, even state-of-the-art parallel implementations are limited by a sampling step that incurs large memory footprints. This in turn limits the problem size reach and approximation quality. In this work, we study the memory footprint of the sampling process collecting reverse reachability information in the IMM algorithm over large real-world social networks. We present an adaptive and memory-efficient optimization approach for a state-of-the-art multi-threaded parallel influence maximization algorithm. Our approach,HuffMax, uses a portion of the reverse reachable (RR) sets collected by the algorithm to learn the characteristics of the graph. Then, it compresses the intermediate reverse reachability information with Huffman coding, and queries directly on the compressed data to preserve the memory savings obtained through compression. We also propose an efficient sampling strategy based on the distribution of RR sets, which can further reduce the computation time for typical social networks with long-tail distributions. Considering a NUMA architecture, we scale up our solution on 128-core CPUs and reduce the memory footprint by up to 45.7% with negligible time overhead (or even faster) and without perceivable loss of accuracy.

Chen, Xinyu↗

Optimal Sizing and Dispatch of Solar Power with Storage

Designers of utility-scale solar plants with storage, seeking to maximize some aspect of plant performance, face multiple challenges. In many geographic locations, there is significant penetration of photovoltaic generation, which depresses energy prices during the hours of solar availability. An energy storage system affords the opportunity to dispatch during higher-priced time periods, but complicates plant design and dispatch decisions. Solar resource variability compounds these challenges, because determining optimal system sizes requires simultaneously considering how the plant will be operated under the imposed market and weather conditions. We develop an approach to analyze the economic performance of hybrid and single-technology solar power plants, which incorporates optimal dispatch, and considers the expected electricity market and weather conditions. We utilize the System Advisor Model software package to simulate the operation of multiple renewable generation and energy storage technologies, in conjunction with hourly-fidelity generation decisions determined by a revenue-maximizing, mixed-integer linear program. We show that, under our assumed market and weather conditions, the lifetime benefit-to-cost ratio can be improved by 6 to 19 percent, relative to a baseline design without optimizing, and that a concentrating solar power with thermal energy storage design produces significantly more energy per year, but is less profitable under our cost assumptions.

black-box optimization↗

Hydropower flexibility valuation tool for flow requirement evaluation

Timing of generation is becoming more and more valuable. This creates greater potential tension between environmental and power system objectives since both systems require their own flow patterns. Identifying win–win outcomes in this context requires being able to discuss the value of flexibility across stakeholder groups. This research proposes a two-stage optimization method to understand hydropower flexibility to meet both environmental and power system requirements. The tool simulates the two-settlement market process in the U.S. by maximizing revenues from both the day-ahead and real-time markets, subject to plant operational limits, regulatory flow and ramping requirements, and uncertainties associated with water availability and market prices. The model is formulated as linear programming problems and solved using IBM ILOG CPLEX optimizer. By examining a range of flow requirements, ramping constraints, and storage capacities, the proposed tool shows how to make more informed decisions to weigh the cost of specific flow requirements in the context of the overall license requirements. Results from the case study show that revenue is more sensitive to the ramping constraints than the minimum flow constraints. We also demonstrate that removing flow constraints in a dry month increases monthly revenue by up to 118%, as opposed to only 1% in a wet month. In addition, our results suggest that using a learning-based water flow forecast results in an increase of monthly revenue up to 6.4% compared with persistence forecast.

13 HYDRO ENERGY↗

Modeling distributed energy resource aggregations in security constrained unit commitment and economic dispatch

The Federal Energy Regulatory Commission (FERC) recently issued Order 2222, which requires all wholesale electricity markets in the US to allow distributed energy resources (DERs) to participate in the market as aggregated resources. These DER aggregations may be composed of many individual resources that are offered and dispatched by the market as a single entity. We present here a model of a distributed energy resource aggregator (DERA) that is scheduled by a market operator’s security constrained unit commitment (SCUC) and security constrained economic dispatch (SCED). The DERA model includes constraints for battery energy storage systems (BESSs), demand response resources (DRRs), and a simple distributed energy resource (DER). This paper describes a model for each resource type and presents two methods for the DERA to generate market offer curves: a profit-maximizing optimization to compute cost curves and a direct cost algorithm to determine dispatch costs for each resource and combine into cost curves. Once all participating DERAs are scheduled in SCUC/SCED, the model is then modified to dispatch individual DERs to maximize profit or minimize schedule deviation of the DERAs. A simulation of a representative day illustrates the DERA offers, the scheduled generation, and the DERA dispatch. Findings show the potential for unavoidable schedule deviations due to internal DER constraints and due to economic incentives to deviate from the SCUC/SCED schedules. This highlights the importance of DERA offer construction on market efficiency and system reliability. Novel aspects of our approach include: (1) We consider the asymmetry of price incentives impacting DERAs from the wholesale market compared to those impacting consumers from the retail market, as imposed by current regulations and laws. (2) We model aggregate consumer response through statistically parameterizable utility functions rather than a potentially impractical approach of modeling each individual consumer. (3) We show how to use the DERA operational dispatch model to create offers into the wholesale electricity market. (4) We show how DERAs may fail to meet their scheduled dispatch because the market offer format may not permit them to fully express their operational features such as intertemporal costs and constraints to the market.

aggregations↗

Nonlinear multiobjective and dynamic real-time predictive optimization for optimal operation of baseload power plants under variable renewable energy

Considering the increase of disruptive variable renewable energy penetration into the power grid, this article focuses on the investigation of a multiobjective and dynamic real-time optimization framework to address the cycling of large-scale power plants under renewable penetration. In this framework, a parallelized particle swarm optimization step is first performed to generate feasible initial points. Then, a multiobjective and dynamic real-time optimization formulation generates optimal trajectories. Further, the benefit of predictive capability is investigated for the dynamic component, which introduces the novel nonlinear multiobjective and dynamic real-time predictive optimization approach. Two multiobjective formulations to obtain Pareto front optimal in real time are explored: the modified Tchebycheff-based weighted metric and ϵ-constraint methods. Economic and environmental objectives are considered in this study. A novel topical discussion on the intersection of dynamic real-time optimization with model predictive control is also presented. The developed framework is successfully applied to a baseload coal-fired power plant with postcombustion CO 2 capture. Results indicate that the approach can be deployed for a large-scale system if automatic differentiation, model reduction, and parallelization are adopted to improve computational tractability, with computational improvement up to 120-folds after performing these steps. Finally, market and carbon policies showed an impact on the optimal compromise between the objectives with an additional 63 ton of CO 2 captured under favorable market conditions.

24 POWER TRANSMISSION AND DISTRIBUTION↗

Study of Storage Requirements and Costs for Shaping Renewables and Nuclear Energy (FY23 Summary Report)

To decarbonize electricity generation primarily by using wind and solar resources, it is likely that additional low (or zero) carbon dioxide (CO 2 ) alternatives will be required for ensuring a reliable electricity supply. This study extends the work and modeling framework that we consolidated in FY 2022, by assessing the zero-CO 2 pathways of a Texas power system in which the availability of variable renewable energy (VRE), nuclear energy, and energy storage types (i.e., battery and thermal energy storage [TES]) are considered the sole resources available for expansion. Using the Risk Analysis Virtual Environment (RAVEN) and Holistic Energy Resource Optimization Network (HERON) frameworks, this study investigates the market of two nuclear energy technologies (i.e., large light-water reactors [LWRs] and LWR-type small modular reactors [SMRs]) under two plausible storage coupling scenarios (i.e., electric coupling and direct thermal coupling). We also explore optimal environments for nuclear energy deployment, and identify key performance characteristics that make nuclear energy economically viable in areas with significant intermittent energy sources. Our analysis encompasses 24 cases. We model the least-cost grid systems, highlight the potential for a coupled LWR-TES approach, and utilize SMRs to achieve deep decarbonization in an affordable, technically feasible manner. We also examine seasonal variations in balancing electricity supply and demand, and account for varying performance, costs, and grid constraints. Overall, the findings of our modeling afford valuable insights for supporting future technology investment decisions in the energy sector.

25 ENERGY STORAGE↗

EMIS-CompetitiveEquilibrium.jl [SWR-19-56]

The Electricity Markets Investment Suite - Competitive Equilibrium (EMIS-CE) model is an optimization-based power system investment model developed at NREL. It attempts to approximate a market-driven investment equilibrium outcome under the assumption of idealized or perfect competition (e.g. no participants are able to exert market power or leverage exclusive cost advantages) and uncertain future conditions.

Stephen, Gord [National Renewable Energy Lab. (NRE↗

Influence of Hybridization on the Capacity Value of PV and Battery Resources

Utility-scale systems that combine solar photovoltaic and battery (PV+battery) technologies are growing in popularity on the U.S. bulk power system. The business case for PV+battery systems depends on both their ability to reduce costs and their ability to generate value synergies associated with the provision of energy, capacity, and ancillary services. Capacity value can constitute a significant portion of the value PV+battery hybrids provide to the grid (e.g., through avoided or deferred capacity) and receive through revenues. Throughout this report, we define capacity value as the monetary value of a plant's contribution towards the planning reserve margin, which ultimately depends on market rules and structures. PV+battery hybrids do not always fit into current market structures because of the interactions between the PV and battery components. Unique considerations for the capacity value of PV+battery hybrids include the disparate nature of participation models for PV and battery technologies in existing market rules and the potential influence of a shared interconnection capacity; limitations imposed by a shared inverter; limited ability to charge the battery in advance of capacity events if charging must be sourced from the coupled PV; and challenges or uncertainties associated with co-optimizing the operations of the PV and battery components. Grid operators are currently considering how market structures can be modified to optimally determine the capacity value provided by PV+battery systems, and the rules of how they are integrated into markets are still being written. As with any resource, poorly designed rules could increase the cost of energy and reduce system reliability, while well-designed rules could allow markets to receive the full benefits hybrid systems can offer without overcompensating them for the services they provide. Well-designed rules for PV+battery systems must consider the unique aspects listed above, while leveraging the commonalities with existing resource types. In this report, we summarize the technical capability and market rules that influence the capacity value of PV+battery systems. We further discuss the potential tradeoffs between computational complexity and accuracy for the various ways in which grid operators can credit PV+battery systems for capacity. Finally, we describe markets for capacity, survey current wholesale market rules applying to PV+battery systems, and provide a snapshot of the current regulatory landscape for PV+battery systems.

14 SOLAR ENERGY↗

Hierarchical Transactive Control of Flexible Building Loads Under Distribution LMP

With grid modernization efforts, future distribution networks, which consist of various distributed generators and flexible loads, will be more flexible and active. All new network components of distributed energy resources (DERs) drive and enable the transition towards a market-based distribution net-work that seeks the optimal allocation of all DERs. To address challenges associated with DERs, one promising solution is to utilize demand-side flexibility of building loads facilitated by demand response (DR) programs and provide ancillary grid services through distribution-level markets. Under this new paradigm, this paper proposes an efficient DR management strategy incorporating emerging price signals of distribution markets, i.e., distribution locational marginal price (DLMP), based on a hierarchical transactive control approach. The proposed approach establishes a two-layer decision-making framework; the upper layer formulates a bilevel model to obtain an optimal demand response (ODR) under DLMP, and the lower layer employs model-free control to dispatch the (aggregated) ODR to individual end users. Numerical case studies using a modified IEEE 33 test network are performed to verify the effectiveness of the proposed approach; load shifting and peak shaving for the distribution system operator and payments’ reduction for end users while maintaining their comfort.

Park, Byungkwon↗

Analytical modeling for redox flow battery design

Deeper market penetration of redox flow batteries requires optimization of the cell performance. Though important for optimization, detailed analytical solutions have not been developed for electrolyte flow, mass and charge transport, and reaction kinetics within redox flow batteries. To this end, here we present analytical solutions to active species concentration and over-potential based on advection-diffusion transport for ions and Bulter-Volmer model for interface reaction kinetics. The solutions were validated with results from a finite element model. These solutions were then applied to investigate the relationship between over-potential and state of charge, current density, reaction rate constant, flow velocity, diffusivity, total active species concentration, and electrode structure. Explicit formulas were identified for minimum activation over-potential and limiting current density as well as their dependence on electrolyte properties, operation conditions, and electrode structure. With our new mathematical formulas, this work provides a theoretical framework for flow battery design.

25 ENERGY STORAGE↗