Integrating renewable energy contracts and wholesale dynamic pricing to serve aggregate flexible loads

In this paper we describe the use of wholesale dynamic pricing for coordinating the demand schedule of a load aggregator which is responsible for matching the consumption of a large population of flexible loads, like EV batteries, with renewable energy resources. We formulate a stochastic optimal control problem that describes the decision problem faced by the aggregator, and we use a dynamic programming algorithm to solve the problem. We control the computational complexity of the algorithm by modeling correlated uncertain variables with a recombinant lattice. We then compare the relative performance of the optimal policy to alternative charging policies, and investigate the sensitivity of our results with respect to the cost of unserved energy and the degree to which the aggregator can respond to dynamic pricing.