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Pricing of emergency dynamic microgrid power service for distribution resilience enhancement

Shang, Duo (Rick)
Energy policy 2017 v.111 pp. 321-335
auctions, consumers (people), critical load, electricity, electricity costs, energy resources, heat, markets, models, power plants, prices, supply balance, weather
Extreme weather events can cause significant damage to power distribution grids, leading to extended power outages. Intentional islanding enables the use of distributed energy resources (DERs) to power critical loads and accelerate grid restoration. In this study, an innovative dynamic microgrid islanding scheme was investigated as a means of enhancing distribution grid resilience. If customers in a dynamic microgrid request emergency electricity services during an outage, the question of how the distribution system operator should price the DER emergency power service arises. To answer this question, an economic load dispatch model was implemented in a single-bid auction market to forecast the market-clearing price of electricity in the dynamic microgrid island. The results show that the cost of emergency service is impacted by the power supply and demand in the island. When the combined heat and power plant capacity of the dynamic microgrid exceeded the demand, the market-clearing price of electricity in the island could be even less than the on-grid electricity price during normal periods. Thus, the dynamic microgrid scheme provides a low-cost means of supplying end-users with emergency power.