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Market model for dispatch in minigrids (isolated & connected)

F. de Cuadra, I.J. Pérez-Arriaga, P. Dueñas


The MIT/Comillas Universal Energy Access Lab has developed the Reference Electrification Model (REM), a software toolbox to solve electrification problems (and assess electrification plans) in developing countries. One of the applications, LREM, deals with the optimal design of the generation components and the network for a particular isolated minigrid. The optimization of the generation components is solved using a master/slave structure, being the optimum dispatch (for a proposed set of components) the slave problem.

The present technical note proposes a method to extend the scope of LREM in different ways. First, the minigrid may be connected to a weak grid subject to frequent failures, instead of being always isolated. Second, the generation site may include additional components (LREM only considers solar, diesel and battery). Third, the demand to be served may include multiple types of customers with different reliability requirements (and contracts).

These new requirements have led to a more general approach, described in this technical note as a market model for dispatch.

In the proposed approach, the dispatch decisions result from a market?like matching process between supply and demand. The agents of this market make bids defined by price and quantity.

Different types of agents may participate in this market:

- Suppliers, like PV and Diesel. They participate with their variable generation costs and their capacity limits (variable in the PV case)

- Consumers, i.e. customers with their variable quantities and their CNSE (Cost of Non?Served Energy) which allows different priorities or contracts.

- Suppliers/consumers, like the grid and the batteries:

This document describes how the general market rules can be applied to this problem, considering the specific models of components to define bids (prices and quantities) in a fake local market, and how to use this market model to find optimal dispatch decisions.

Keywords: Minigrids, optimal dispatch, market model, electrification

Registration date: 18/12/2019


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