Operation and control of BESS using frequency‐linked pricing in real‐time market with high wind penetration

Purpose – Recently, many countries have been pushing for a higher share of renewable energy sources, especially wind, in their generation mix. However, the intermittent and uncertain nature of wind power imposes a limit on the extent it can replace the conventional generation resources. In a high wind penetration scenario, the Battery Energy Storage System (BESS) offers a solution to the grid operation problems. The purpose of this paper is to evaluate the merits of price‐based operation of BESS in a real‐time market with high wind penetration using frequency‐linked pricing. Design/methodology/approach – The authors propose a real‐time market in which real‐time prices are based on the grid frequency. A model for real‐time price‐based operation of a conventional generator and a BESS is presented. Simulations for different wind penetration scenarios are carried out on an isolated area test system. Wind speed sequence is generated using composite wind speed model. A simplified model of wind speed to power conversion is adopted to observe the impact of increase in wind power generation on the grid frequency and the real‐time prices. Findings – The result of simulations show that BESS not only helps in dealing with uncertainty in wind power forecasts, but also reduces the fluctuations in frequency due to wind power's intermittency. Price‐based operation of BESS results in higher operating revenues by discharging it at peak prices and reduces operating costs by charging it at minimum prices. Social implications – The study helps in achieving the societal goal of replacing fossil fuel generation by environment friendly generation and reducing green house gas emissions. Originality/value – The novelty of this paper lies in the use of frequency‐linked pricing in real‐time market and proposing a control algorithm for operating BESS using these price signals.