Price-Maker Bidding in Day-Ahead Electricity Market for a Retailer With Flexible Demands

Abstract

This study develops a short-term planning model to determine the bidding curves on a day-ahead market for a price-maker retailer with flexible power demand. It concerns the interactions between the spot price and the flexible demand. Both conditional value-at-risk and volume deviation risk are taken into account. A numerical study using the data from the Nordic electricity market is performed to investigate the influence of risk factors on the retailer's profit, risk levels, average spot price, and total consumption. Three types of price elasticity are compared to show that the retailer can benefit from the flexibility in demand side in some cases. The flexibility also leads to lower spot prices so that the customers in real-time price-based demand response can face a lower electricity price for per-unit power consumption.