Distributed Algorithm-based Equilibrium Analysis for Downward Regulation Market with Demand Response Resource

Regulating capacity shortage will impose negative impact on the accommodation of renewable energy in a power system. Especially in off-peak load periods, the accommodation of wind power is highly dependent on the downward regulation capability of the power system. To encourage the provision of the downward regulation services and reasonably evaluate their market value, this paper presents a downward regulation market where power generators and demand response resources compete by submitting bids to meet the demand of downward regulation capacity in off-peak load periods. To investigate the bidding strategies in the downward regulation market, a game-theoretic equilibrium model is developed, in which supply function bid is considered. The equilibrium model can be transformed into a convex optimization model based on the equivalence of the optimality condition. Then, a distributed algorithm is applied to solve the convex optimization model and achieve equilibrium results. Numerical results illustrate the effectiveness of the proposed model and algorithm.