Multi-Interval Energy-Reserve Co-Optimization With SoC-Dependent Bids From Battery Storage

We consider the problem of co-optimized energy-reserve market clearing with state-of-charge (SoC) dependent bids from battery storage participants. While SoC-dependent bids capture storage's degradation and opportunity costs, such bids result in a non-convex optimization in the market clearing process. More challenging is the regulation reserve capacity clearing, where the SoC-dependent cost is uncertain as it depends on the unknown regulation trajectories ex-post of the market clearing. Addressing the nonconvexity and uncertainty in a multi-interval co-optimized real-time energy-reserve market, we introduce a simple restriction on the SoC-dependent bids along with a robust optimization formulation, transforming the non-convex market clearing under uncertainty into a standard convex piece-wise linear program and making it possible for large-scale storage integration. Under reasonable assumptions, we show that SoC-dependent bids yield higher profits for storage participants than SoC-independent bids. Numerical simulations demonstrate a 28%–150% profit increase of the proposed SoC-dependent bids compared with the SoC-independent counterpart.