Optimization of Heterogeneous Resources Combination using Virtual Power Plant based on Modern Portfolio Theory

In recent years, with the development of smart grid technologies, wind turbines, photovoltaics and other renewable energy sources as well as demand-side loads have participated in grid dispatching, resulting in increased complexity of energy flows in the grid. Distributed energy resources (DERs) differ in many dimensions, such as technical attributes, operating modes, and business objectives, and its management authority also belongs to different entities, making it more difficult for grids to manage DERs. A management mode, virtual power plant (VPP), being enabled by information and communication technology, could effectively overcome the challenges with decentralized DERs and help realize the aggregation of DERs. In this paper, the interaction between customers and VPP is modeled, where VPP divides the owners of DERs into three categories according to the willingness and responsiveness of customers and balances budget costs and risks based on the modern portfolio theory. Simulation with the CIGRE 20kV distribution network benchmark demonstrates that VPP could greatly meet the power consumption demand of multiple participants during operation. This paper also provides a basis for the selection of DERs aggregated by VPP.11This paper is sponsored by the National Key Research and Development Program (No.2017YFB0903300) and National Natural Science Foundation of China (No.51807107) 22This paper is sponsored by the Young Talents Support Project of the Chinese Society for Electrical Engineering (CSEE) titled “Research on key technologies for optimal operation and control of transportation energy systems”