A Hierarchical Transactive Control Architecture for Renewables Integration in Smart Grids: Analytical Modeling and Stability

In this paper, we propose a hierarchical transactive control architecture that combines market transactions at the higher levels with inter-area and unit-level control at the lower levels. A model of this architecture is introduced, with dynamics at primary, secondary, and tertiary levels. With a goal of ensuring frequency regulation using optimal allocation of resources in the presence of uncertainties in renewables and load, a hierarchical control methodology is presented. Global asymptotic stability of the overall system is established in the presence of uncertainties at all three time-scales. An IEEE 30-bus as well as simulations of practical examples of realistic sizes are used to validate the approach where it is shown that the proposed control architecture has the potential to reduce cost of reserves and to increase social welfare.