TY - JOUR

T1 - Trading wind generation from short-term probabilistic forecasts of wind power

A1 - Pinson,Pierre

A1 - Chevallier,Christophe

A1 - Kariniotakis,Georges

AU - Pinson,Pierre

AU - Chevallier,Christophe

AU - Kariniotakis,Georges

PB - I E E E

PY - 2007

Y1 - 2007

N2 - Due to the fluctuating nature of the wind resource, a wind power producer participating in a liberalized electricity market is subject to penalties related to regulation costs. Accurate forecasts of wind generation are therefore paramount for reducing such penalties and thus maximizing revenue. Despite the fact that increasing accuracy in spot forecasts may reduce penalties, this paper shows that, if such forecasts are accompanied with information on their uncertainty, i.e., in the form of predictive distributions, then this can be the basis for defining advanced strategies for market participation. Such strategies permit to further increase revenues and thus enhance competitiveness of wind generation compared to other forms of dispatchable generation. This paper formulates a general methodology for deriving optimal bidding strategies based on probabilistic forecasts of wind generation, as well as on modeling of the sensitivity a wind power producer may have to regulation costs. The benefits resulting from the application of these strategies are clearly demonstrated on the test case of the participation of a multi-MW wind farm in the Dutch electricity market over a year.

AB - Due to the fluctuating nature of the wind resource, a wind power producer participating in a liberalized electricity market is subject to penalties related to regulation costs. Accurate forecasts of wind generation are therefore paramount for reducing such penalties and thus maximizing revenue. Despite the fact that increasing accuracy in spot forecasts may reduce penalties, this paper shows that, if such forecasts are accompanied with information on their uncertainty, i.e., in the form of predictive distributions, then this can be the basis for defining advanced strategies for market participation. Such strategies permit to further increase revenues and thus enhance competitiveness of wind generation compared to other forms of dispatchable generation. This paper formulates a general methodology for deriving optimal bidding strategies based on probabilistic forecasts of wind generation, as well as on modeling of the sensitivity a wind power producer may have to regulation costs. The benefits resulting from the application of these strategies are clearly demonstrated on the test case of the participation of a multi-MW wind farm in the Dutch electricity market over a year.

KW - wind energy

KW - forecasting

KW - decision-making

KW - energy markets

KW - uncertainty

U2 - 10.1109/TPWRS.2007.901117

DO - 10.1109/TPWRS.2007.901117

JO - I E E E Transactions on Power Systems

JF - I E E E Transactions on Power Systems

SN - 0885-8950

IS - 3

VL - 22

SP - 1148

EP - 1156

ER -