Wind-Battery Pool Optimal Bidding in German Energy and Secondary Control Reserve Markets

This paper presents an optimization framework for a pool comprising a wind-farm and a grid-scale Battery Energy Storage System (BESS). The proposed framework optimizes the day-ahead (D-1) bidding decisions in the day-ahead energy market and in the Automatic Frequency Restoration Reserve (aFRR) capacity and energy markets, in view of uncertainties pertaining to actual wind power production, aFRR energy activation, as well as aFRR capacity market prices. The aFRR energy activation mechanism follows the architecture of the recently introduced European PICASSO market platform. The model is formulated as a three-stage stochastic optimization problem, modeling explicitly the operational constraints related to the BESS state-of-charge management when providing aFRR. In addition, using the Conditional-Value-at-Risk (CVaR), the proposed framework allows to model different levels of risk aversion. This optimal bidding model is evaluated using actual data, i.e., market prices and wind power production from July to December 2022. The results of our case study showcase the additional revenue streams emerging from the wind-battery joint operation, the wind imbalance mitigation benefits of the BESS and the value of the aFRR capacity and energy markets.