Enabling Active Distribution Systems’ Participation in Tertiary Frequency Regulation Through Coalitional Game Theory-Based Reserve Allocation

The integration of distributed energy resources (DERs) into the power grid has made it important for distribution systems to participate in frequency regulation. Regulatory authorities (e.g., Federal Electricity Regulatory Commission in the United States) are recommending that DERs participate in energy and reserve markets, and a mechanism is needed to facilitate this at the distribution level. Though a single distribution system may not have sufficient reserves for tertiary frequency regulation, stacked reserves from multiple distribution systems can be utilized in frequency regulation. This paper proposes a coalitional game theory-based approach for reserve allocation, enabling DERs to participate in tertiary frequency regulation. The proposed two-stage approach involves computing worthiness index (WI) and power loss reduction (PLR) characteristic functions in the first stage and equivalent Shapley values in the second stage. The Shapley values are then used to determine distribution factors for reserve allocation among DERs. We demonstrate the effectiveness of the proposed method through case studies on IEEE 13-node, IEEE 34-node, and IEEE 123-node distribution test systems. The method is shown to be effective in allocating reserves and determining active power set-points of DERs, and can enable efficient participation of DERs in tertiary frequency regulation.