Yao Lu’s research while affiliated with State Grid Electric Power Research Institute and other places

As the Chinese government proposes ambitious plans to promote low-carbon transition, energy storage will play a pivotal role in China’s future power system. However, due to the lack of a mature electricity market environment and corresponding mechanisms, current energy storage in China faces problems such as unclear operational models, insufficient cost recovery mechanisms, and a single investment entity, making it difficult to support the rapid development of the energy storage industry. In contrast, European and American countries have already embarked on certain practices in energy storage operation models. Through exploration of key issues such as investment entities, market participation forms, and cost recovery channels in both front and back markets, a wealth of mature experiences has been accumulated. Therefore, this paper first summarizes the existing practices of energy storage operation models in North America, Europe, and Australia’s electricity markets separately from front and back markets, finding that perfect market mechanisms and reasonable subsidy policies are among the main drivers for promoting the rapid development of energy storage markets. Subsequently, combined with the actual development of China’s electricity market, it explores three key issues affecting the construction of cost-sharing mechanisms for energy storage under market conditions: Market participation forms, investment and operation modes, and cost recovery mechanisms. Finally, in line with the development expectations of China’s future electricity market, suggestions are proposed from four aspects: Market environment construction, electricity price formation mechanism, cost sharing path, and policy subsidy mechanism, to promote the healthy and rapid development of China’s energy storage industry.

At present, all countries are accelerating the construction of a new type of power system based on renewable energy, and the random volatility and intermittency of new energy resources, and the low resistance and weak support of new energy power generation and grid-connected equipment exist objectively. In order to maintain the safe and stable operation of the power system, the demand for auxiliary services such as frequency regulation, peak regulation, voltage regulation, standby and black start is increasing. Therefore, with the increase of new energy penetration rate, it is necessary to explore the impact of the increase of new energy penetration rate on the cost of auxiliary services. Combined with the background that the foreign power market has been running for a long time, auxiliary service varieties are more abundant, and the new energy penetration rate of some countries or TSOs has reached a higher level, the author has conducted a study on the impact of the increase in the penetration rate of new energy on the cost of auxiliary services in foreign countries, explored the impact of the increase in the penetration rate of new energy on the cost of auxiliary services, and provided reference and guidance for the classification of auxiliary service products, the design of pricing mechanism and other key issues of the construction of the auxiliary service market in China. The study explores the impact of the increase of new energy penetration on the cost of auxiliary services, and provides reference and guidance for the division of auxiliary service products, design of pricing mechanism and other key issues of auxiliary service market in China.

With the advancement of distributed power generation technology and the deepening of the low-carbon transformation of energy structure, a high proportion of renewable energy has become an inevitable trend in future energy systems, especially for microgrids. However, the volatility and uncertainty associated with renewable energy pose significant challenges to the secure and stable operation of power systems, necessitating the exploration of the flexible regulation of resources. Energy storage, as a crucial flexible resource characterized by technological diversity and a variety of regulation capabilities, has been extensively studied and applied. Nonetheless, the high investment costs and limited returns of energy storage technology, coupled with the ambiguous utility in different scenarios under the current electricity market’s framework, complicate its broader application. To thoroughly analyze the utility of energy storage in facilitating flexible adjustments in microgrids, this study developed a composite weight-TODIM (an acronym in Portuguese for interactive and multi-criteria decision making) model for assessing the utility of energy storage that incorporates heterogeneity in the risk preferences. This model enabled a comparative analysis of the utility of energy storage technology across multiple scenarios, taking the risk preferences of decision-makers into account, thereby providing strategic insights for the application of multi-temporal energy storage in microgrids. The feasibility and effectiveness of the model were validated through a case study analysis.

This article considers the optimal bidding model of traditional thermal power generation companies’ electricity sales companies, taking into account transmission congestion, under the influence of new policies such as the renewable portfolio standard (RPS) and the renewable exchange certificate (REC). Firstly, the transaction cost of green certificates is included in the cost of electricity sales, and an optimization model is established with the goal of maximizing the profit of the electricity sales company; Secondly, the node electricity price method is used to manage transmission congestion, and an optimization model is established with the goal of minimizing the cost of transmission congestion; Finally, multi agent technology and dynamic game theory are used to solve the optimal bidding strategy of the electricity selling company.