Modeling the Energy Cooperation between Regionally Interconnected Aggregators using Bilateral Agreements

Traditional centralized power dispatching systems have inherent limitations in dealing with the increasing penetration of variable renewable energy generation in distribution networks. This study presents a flexible energy exchange mechanism for regionally interconnected aggregators in regards to VRE penetration. Direct energy exchange between neighboring aggregators is proposed as a promising method of maximizing social welfare (i.e. maximization of end-users benefits and minimization of energy costs). The main idea of the proposed mechanism is to develop a parallel energy exchange cooperation between physically connected aggregators ensuring operational efficiency of the power systems at a local level. Given that neighboring aggregators may have differences in their energy generation and usage patterns these differences can be utilized to bridge the mismatch of each other’s supply shortage. An operational scenario of regionally interconnected aggregators is presented and investigated. The initial simulation results have illustrated the effectiveness and reliability of the proposed model and method.