A Profit Optimization Approach Based on the Use of Pumped-Hydro Energy Storage Unit and Dynamic Pricing

TL;DR

This paper presents an optimization method combining pumped-hydro energy storage and wind farms to maximize profits and support the power system, validated through simulations with real data.

Contribution

It introduces a novel profit optimization approach integrating pumped-hydro storage with wind energy and dynamic pricing, demonstrating its effectiveness through detailed simulations.

Findings

Pumped-hydro storage effectively increases profit at high power levels.

The proposed method outperforms cases without storage or pricing strategy.

Simulation results confirm cost-effective benefits of the approach.

Abstract

In this study, an optimization problem is proposed in order to obtain the maximum economic benefit from wind farms with variable and intermittent energy generation in the day ahead and balancing electricity markets. This method, which is based on the use of pumped-hydro energy storage unit and wind farm together, increases the profit from the power plant by taking advantage of the price changes in the markets and at the same time supports the power system by supplying a portion of the peak load demand in the system to which the plant is connected. With the objective of examining the effectiveness of the proposed method, detailed simulation studies are carried out by making use of actual wind and price data, and the results are compared to those obtained for the various cases in which the storage unit is not available and/or the proposed price-based energy management method is not applied. As a consequence, it is demonstrated that the pumped-hydro energy storage units are the storage systems capable of being used effectively for high-power levels and that the proposed optimization problem is quite successful in the cost-effective implementation of these systems.