Decentralized Participation of Flexible Demand in Electricity Markets—Part II: Application With Electric Vehicles and Heat Pump Systems

TLDR

Demand flexibility in deregulated power systems must be integrated into electricity markets, and Part I introduced a novel pool market mechanism that blends centralized control with dynamic pricing using Lagrangian relaxation. Part II applies this mechanism to electric vehicles and heat‑pump systems with heat storage to demonstrate its practical feasibility. The authors formulate price‑response sub‑problems for EVs and heat‑pump systems, modeling their operational characteristics. Case studies on a UK system model validate the mechanism’s properties and demonstrate benefits of market participation for EVs and heat‑pump systems.

Abstract

Realizing the significant demand flexibility potential in deregulated power systems requires its suitable integration in electricity markets. Part I of this work has presented the theoretical, algorithmic and implementation aspects of a novel pool market mechanism achieving this goal by combining the advantages of centralized mechanisms and dynamic pricing schemes, based on Lagrangian relaxation (LR) principles. Part II demonstrates the applicability of the mechanism, considering two reschedulable demand technologies with significant potential, namely electric vehicles with flexible charging capability and electric heat pump systems accompanied by heat storage for space heating. The price response sub-problems of these technologies are formulated, including detailed models of their operational properties. Suitable case studies on a model of the U.K. system are examined in order to validate the properties of the proposed mechanism and illustrate and analyze the benefits associated with the market participation of the considered technologies.