Engineering

Environmental economics

Microeconomics

Operating system

Economics

Computer science

Mathematical optimization

News aggregator

Business

Demand response

Operations research

Renewable energy

Mathematics

Management

Bidding

Flexibility (engineering)

Electricity

Electrical engineering

Applied Energy

This paper proposes a two-stage stochastic optimization model to support an aggregator of prosumers in the definition of bids for the day-ahead energy and secondary reserve markets. The aggregator optimizes the prosumers’ flexibility with the objective of minimizing the net cost of buying and selling energy and secondary reserve in both day-ahead and real-time market stages. The uncertainties of the renewable generation, consumption, outdoor temperature, prosumers’ preferences, and house occupancy are modeled through a set of scenarios. For a case study of 1000 prosumers, the results show that the proposed bidding strategy reduces the costs of both aggregator and prosumers by 40% compared to a bidding strategy typically used by retailers.

Optimal bidding strategy for an aggregator of prosumers in energy and secondary reserve markets