Research Specifications

In this article, we outline a novel bilevel decision-making framework for a price-maker virtual power plant (VPP) to participate in both day-ahead and balancing oligopoly markets considering multiple forward contracts. In principle, the VPP operator with having the possession of financial transmission rights can manage its financial risk through trading electricity among various markets such as centralized pool and contract markets aimed at maximizing its own profit and minimizing the associated risk. Besides, the VPP operator will be able to optimize its procurement expenditures by incentivizing flexible demands proportion to different electricity tariffs. In the proposed bilevel model, the VPP aggregator strives to maximize its own profit at the upper level while an independent system operator seeks to clear both markets at the lower levels with an eye to maximize social welfare. Each lower level is then replaced by its complementarity slackness conditions and, conse quently, is recast as a mathematical program with equi librium constraints that can be solved using off-the-shelf software packages. Furthermore, the uncertainty pertaining to renewables has been envisaged through information gap decision theory resulting in robustness/opportunity func28 tion to deal with self-scheduling of VPP. This article ends up with different illustrative case studies through performing after-the-fact actual market data to verify the applicability of the model.