Independent Energy Storage Systems can Minimize Uncertainty of Profit for Retailers in ISO Market

Day by day many countries in the world have been introducing the deregulated power market. The independent system operator (ISO) runs and manage the whole system of deregulated market. ISO also runs the wholesale market, retailers and generations companies enter the wholesale market for biding and ISO clears the market. As it is a competitive market, so retailer should make optimal bidding that means they should not buy electricity more or less than their demand. In deregulated market normally retailer can bid in three different times, day ahead bidding, hour ahead bidding and spot market bidding. The day ahead market price of electricity is cheaper than hour ahead and spot market. However, retailers of the deregulated power market have to deliver their power to the transmission line at the right time according to their contract. As we know, demand for electricity has uncertainty, it is varying from time to time. If a retailer is unable to deliver a certain amount of electricity on a specific time, ISO has ancillary transmission right to set a large penalty for retailers. This research introduces an independent energy storage system (IESS) who is reducing the problem of hour ahead market’s retailer transmission penalty by meeting load mismatch. Besides this research reduces the installation cost of IESS. The effectiveness and simulation results are examined by MATLAB® simulation.