Research On Power Generator And Retailer's Strategies Under Balancing Mechanism And Renewable Portfolio Standard

China is going through a critical period of energy transformation and electricity market reform.With the development of renewable energy market,Renewable Portfolio Standard(RPS)has become the targeted renewable energy incentive mechanism in China and it is under government's long-term plan that RPS overtake Feed-in Tariff(FIT)gradually in recent years.In addition,electricity transaction in China is mainly conducted by medium-and long-term market contracts currently,while the spot electricity market has not yet been implemented.An appropriate energy imbalance processing mechanism for medium-and long-term power transactions is highly demanded for maintaining the stability of market operation,since it is supposed to guide market participants to reduce system imbalances and actively provide balancing services.Generation companies and electricity retailers remain the most core participants in the power market.On the one hand,the implementation of market mechanisms can influence the decision-making process of various market participants,on the other hand,decision-making of market participants can also reflect the implementation effect of market mechanisms.The following research work is carried out mainly concerning investment strategies of generation companies and electricity retailers under multi-market environment built with typical market mechanisms:Based on the monthly pre-listing balancing mechanism in China,a bi-level optimization model for developing optimal bidding strategies of power producer in the monthly sequential contract and balancing markets is proposed.In the upper level of the model,the monthly utility which makes a tradeoff between revenues and risks produced by the bidding strategy of the producer in the monthly sequential energy dual-market is maximized,considering the uncertainties of the monthly energy imbalances in the power system and the bidding strategies of competitors.In the lower level,the dispatch cost is minimized by simulating the three-stage process of sequential system operation,which includes contract market clearing by power exchange(PX),energy decomposition and modification by system operator(SO)and balancing market clearing by PX.The presented model can assist power producers in adjusting their monthly bidding strategies with relevant factors.In addition,the proposed method is also helpful for market designers in setting market parameters in the balancing market.Based on RPS in China,the decision-making model of electricity retailers to accomplish the obligation under RPS is constructed as a bi-layer portfolio selection model,by applying modern portfolio theory(MPT)and prospect theory(PT).In the inner-layer,both capital allocation of the retailers to purchase various kinds of renewable energy capacity as well as RECs are optimized respectively.The risk encountered by the retailers is modeled using scenario-based method,taking into account the uncertainties of renewable energy generation and the volatility of REC price.In the outer-layer,capital investment portfolio of each risky and risk-free strategy is determined based on Behavioural Portfolio Theory(BPT).Apart from assisting retailers assigning capital in multi-market environment,the proposed model provides insights for policy makers to set key parameters involving the design of RPS by analyzing behaviours of retailers.To sum up,in view of the market background of the proposals of the pre listing monthly balance deviation mechanism and renewable portfolio standard under the current power market reform in China,the problems of bidding on the market as well as purchasing on the market are discussed respectively for power generators and electricity retailers,not only to provide guidance for the decision-making of various market participants,but also to offer references for the parameter-designing of policy makers.