Renewable power generators typically participate as price-takers in current electricity markets, and market clearing prices are determined by cost curves of conventional generators while treating renewable generation as negative load. In this paper, we analyze a new design of electricity markets where renewable power generators are able to bid their expectation- adjusted cost curves into the market, just like the cost curves of conventional generators. We formally define the new market model, and mathematically show how the renewable cost curves should be determined for the new market to be equivalent to the current market in terms of overall system cost. We further establish that on the average, the total revenue of both conventional and renewable generators, as well as the total cost to consumers, under the proposed market is the same as the current practice. While equivalent in terms of aggregate cost and revenue measures, the new market design allows renewables to be direct participants in the bidding process and bid according to their risk-return tolerance. We demonstrate our analytical results numerically using data obtained from the the Texas grid. Index Terms—renewable bidders, expectation-adjusted cost curves, stochastic unit commitment.
 

About the Speaker
Zihan Nie is a third-year Ph.D student in the RPI Department of Mathematical Sciences. Her current research focuses on Optimization, Machine Learning and Risk Modeling, with applications spanning energy systems with high renewable penetration and financial technologies.