Modeling Distributed Energy Resource Aggregations in Security Constrained Unit Commitment and Economic Dispatch

Journal Article · Tue Sep 30 00:00:00 EDT 2025 · International Journal of Electrical Power & Energy Systems

DOI:https://doi.org/10.1016/j.ijepes.2025.110727· OSTI ID:3013812

Holzer, Jesse T.; Cornachione, Matthew A.; Li, Liping; Schweitzer, Eran; Eldridge, Brent C.

The Federal Energy Regulatory Commission (FERC) recently issued Order 2222, which requires all wholesale electricity markets in the US to allow distributed energy resources (DERs) to participate in the market as aggregated resources. These DER aggregations may be composed of many individual resources that are offered and dispatched by the market as a single entity. We present here a model of a distributed energy resource aggregator (DERA) that is scheduled by a market operator’s security constrained unit commitment (SCUC) and security constrained economic dispatch (SCED). The DERA model includes constraints for battery energy storage systems (BESSs), demand response resources (DRRs), and a simple distributed energy resource (DER). This paper describes a model for each resource type and presents two methods for the DERA to generate market offer curves: a profit-maximizing optimization to compute cost curves and a direct cost algorithm to determine dispatch costs for each resource and combine into cost curves. Once all participating DERAs are scheduled in SCUC/SCED, the model is then modified to dispatch individual DERs to maximize profit or minimize schedule deviation of the DERAs. A simulation of a representative day illustrates the DERA offers, the scheduled generation, and the DERA dispatch. Findings show the potential for unavoidable schedule deviations due to internal DER constraints and due to economic incentives to deviate from the SCUC/SCED schedules. This highlights the importance of DERA offer construction on market efficiency and system reliability. Novel aspects of our approach include: (1) We consider the asymmetry of price incentives impacting DERAs from the wholesale market compared to those impacting consumers from the retail market, as imposed by current regulations and laws. (2) We model aggregate consumer response through statistically parameterizable utility functions rather than a potentially impractical approach of modeling each individual consumer. (3) We show how to use the DERA operational dispatch model to create offers into the wholesale electricity market. (4) We show how DERAs may fail to meet their scheduled dispatch because the market offer format may not permit them to fully express their operational features such as intertemporal costs and constraints to the market.

• Research Organization: Pacific Northwest National Laboratory (PNNL), Richland, WA (United States)
• Sponsoring Organization: USDOE
• Grant/Contract Number: AC05-76RL01830
• OSTI ID: 3013812
• Report Number(s): PNNL-SA-204672
• Journal Information: International Journal of Electrical Power & Energy Systems, Journal Name: International Journal of Electrical Power & Energy Systems Vol. 170
• Country of Publication: United States
• Language: English

Related Subjects

aggregations
battery energy storage systems
demand response
wholesale electricity market
distributed energy resources