Participation of a Combined Wind and Storage Unit in the Day-ahead and Local Balancing Markets

In this paper, the market participation of an independent energy producer owning a combined wind generator-energy storage system (WG-ESS) connected to the distribution network is considered. A mathematical model for the profit maximization of the WG-ESS participating strategically in wholesale day-ahead and local balancing markets (LBMs) is proposed. We assume that in a future dominated by uncertainty and variability from distributed renewable energy sources, such a LBM, to be operated by a new entity called distribution market operator (DMO) will evolve. A stochastic bi-level optimization algorithm is adopted, where the WG-ESS maximizes its profit in the day-ahead market and the DMO-operated LBM. The results show that the strategic decisions of the WG-ESS in multiple markets significantly change compared to a single DA energy-only market.