Data centers to offer ancillary services

Abstract

Considering the growing number of Internet and cloud computing data centers being built in recent years and given the data centers' major and yet flexible electric load, they can be good candidates to offer ancillary services, such as voluntary load reduction, to a smart grid. In this paper, we investigate such potential within an analytical profit maximization framework to determine whether participation in an ancillary service market can be beneficial to data centers. The profit model that we introduce includes elements with respect to a) the data center's revenue obtained from the Internet services that the data center offers based on its service-level agreements (SLA), b) the data center's cost of electricity based on time-of-use prices, and c) the monetary compensation that the data center may receive due to offering ancillary services based on the existing ancillary service market models in the ERCOT (Electric Reliability Council of Texas) Independent System Operator. Our simulation results show that data centers can noticeably increase their profit by participating in voluntary load reduction. Their participation can also help the grid better maintain service quality and reliability.