A Business model for Strategic Bidding of Wind Power Plant and District Heating System Portfolio

Abstract

This paper proposes a business model based on a bidding strategy for the wind power plant and district heating system (WPP-DHS) portfolio. It takes into account energy sales in the day-ahead market, penalties in the balancing market, as well as heat sales in the heat market, with the goal of maximizing profits for the WPP-DHS portfolio. Due to the uncertainty of wind power production, the actual power production will always deviate from the bid volume when WPP participates in the dayahead market independently, resulting in a decrease in overall revenue. In the proposed business model, WPP and DHS participate in the day-ahead market as a portfolio. The flexibility of the DHS can be utilized to compensate for the power deviation of the WPP, thereby increasing the revenue of the WPP-DHS portfolio. The uncertainty of the power production is simulated based on scenarios. A stochastic optimization model is established to schedule power and heat production and create bids for the day-ahead market. Case studies verify the efficiency of the proposed models and methods.