The energy sector is facing a transformation, the traditional business model for electricity generated by large, centralised plants with limited customer engagement and standardized supply contracts is fading away. The restyling of the electricity markets is a consequence of several factors: the liberalisation of the electricity sector begun around 20 years ago in Italy; the growth of the intermittent and unpredictable renewable technologies thanks to lower costs and larger investments than fossil fuels ones; the spread of distributed generation that makes the consumer able to produce energy too, which makes him an active player in the market by becoming a so-called prosumer. In this context, given the dynamism to which the electricity market is subjected, it is interesting to study the economic feasibility of enhanced bidding strategies from the point of view of the manager of a plant consisting of photovoltaic and Power-to-Gas. The starting point of this thesis is a code formulated by the research group from the Department of Industrial Engineering at the University of Padua which comprehends Jan Marc Schwidtal, Marco Agostini, Massimiliano Coppo, Fabio Bignucolo and Arturo Lorenzoni. Specifically, the research work models the operation of a virtually aggregated plant by highlighting the opportunities arising from the value stacking in terms of progressive market penetration of this unit. It evaluates energy flows and financial results on annual basis, taking into account technical constraints of the photovoltaic generation and of the Power-to-gas specifications. In this thesis, changes have been introduced concerning only the description of the economic side of the model and not the technical one. The idea is to implement an enhanced optimization approach to formulate a combined bidding strategy across the energy markets and the auxiliary services markets, exploiting the concept of cross-market arbitrage: this method regards in particular the intraday and balancing markets and consists in buying and subsequently reselling the same type of energy in the same quantity at two different prices. Four different operating modes with a gradual and increasing integration in the markets are studied and the respective optimization problems are solved using the Gurobi solver through the Yalmip toolbox installed within the Matlab software. Lastly, considerations were drawn about the risk management that could affect the manager of the unit by investigating how far it is possible to go in adopting this bidding strategy while operating the plant.
The energy sector is facing a transformation, the traditional business model for electricity generated by large, centralised plants with limited customer engagement and standardized supply contracts is fading away. The restyling of the electricity markets is a consequence of several factors: the liberalisation of the electricity sector begun around 20 years ago in Italy; the growth of the intermittent and unpredictable renewable technologies thanks to lower costs and larger investments than fossil fuels ones; the spread of distributed generation that makes the consumer able to produce energy too, which makes him an active player in the market by becoming a so-called prosumer. In this context, given the dynamism to which the electricity market is subjected, it is interesting to study the economic feasibility of enhanced bidding strategies from the point of view of the manager of a plant consisting of photovoltaic and Power-to-Gas. The starting point of this thesis is a code formulated by the research group from the Department of Industrial Engineering at the University of Padua which comprehends Jan Marc Schwidtal, Marco Agostini, Massimiliano Coppo, Fabio Bignucolo and Arturo Lorenzoni. Specifically, the research work models the operation of a virtually aggregated plant by highlighting the opportunities arising from the value stacking in terms of progressive market penetration of this unit. It evaluates energy flows and financial results on annual basis, taking into account technical constraints of the photovoltaic generation and of the Power-to-gas specifications. In this thesis, changes have been introduced concerning only the description of the economic side of the model and not the technical one. The idea is to implement an enhanced optimization approach to formulate a combined bidding strategy across the energy markets and the auxiliary services markets, exploiting the concept of cross-market arbitrage: this method regards in particular the intraday and balancing markets and consists in buying and subsequently reselling the same type of energy in the same quantity at two different prices. Four different operating modes with a gradual and increasing integration in the markets are studied and the respective optimization problems are solved using the Gurobi solver through the Yalmip toolbox installed within the Matlab software. Lastly, considerations were drawn about the risk management that could affect the manager of the unit by investigating how far it is possible to go in adopting this bidding strategy while operating the plant.
Optimal management of a virtual power plant with photovoltaic and power-to-gas to exploit the benefit of value stacking from crossmarket arbitrage
ISEPPATO, RICCARDO
2022/2023
Abstract
The energy sector is facing a transformation, the traditional business model for electricity generated by large, centralised plants with limited customer engagement and standardized supply contracts is fading away. The restyling of the electricity markets is a consequence of several factors: the liberalisation of the electricity sector begun around 20 years ago in Italy; the growth of the intermittent and unpredictable renewable technologies thanks to lower costs and larger investments than fossil fuels ones; the spread of distributed generation that makes the consumer able to produce energy too, which makes him an active player in the market by becoming a so-called prosumer. In this context, given the dynamism to which the electricity market is subjected, it is interesting to study the economic feasibility of enhanced bidding strategies from the point of view of the manager of a plant consisting of photovoltaic and Power-to-Gas. The starting point of this thesis is a code formulated by the research group from the Department of Industrial Engineering at the University of Padua which comprehends Jan Marc Schwidtal, Marco Agostini, Massimiliano Coppo, Fabio Bignucolo and Arturo Lorenzoni. Specifically, the research work models the operation of a virtually aggregated plant by highlighting the opportunities arising from the value stacking in terms of progressive market penetration of this unit. It evaluates energy flows and financial results on annual basis, taking into account technical constraints of the photovoltaic generation and of the Power-to-gas specifications. In this thesis, changes have been introduced concerning only the description of the economic side of the model and not the technical one. The idea is to implement an enhanced optimization approach to formulate a combined bidding strategy across the energy markets and the auxiliary services markets, exploiting the concept of cross-market arbitrage: this method regards in particular the intraday and balancing markets and consists in buying and subsequently reselling the same type of energy in the same quantity at two different prices. Four different operating modes with a gradual and increasing integration in the markets are studied and the respective optimization problems are solved using the Gurobi solver through the Yalmip toolbox installed within the Matlab software. Lastly, considerations were drawn about the risk management that could affect the manager of the unit by investigating how far it is possible to go in adopting this bidding strategy while operating the plant.File | Dimensione | Formato | |
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https://hdl.handle.net/20.500.12608/43148