Techno-economic assessment of demand response aggregation under different market price conditions

This paper aims to present a probabilistic assessment of aggregated demand response (DR) under different market price conditions for both day-ahead and balancing prices. Different market scenarios are simulated using specific price evolution stochastic models developed to take into account different levels of price volatility and price spikes. The value of a portfolio of Demand Response (DR) customers under operational uncertainties is assessed through a Real Options (RO) approach where DR is considered as RO contracts allowing an aggregator seeking to maximise its revenue to sell flexible demand in the day-ahead and balancing markets. Numerical case studies demonstrate the sensitivity of the DR aggregator´s profits to the physical characteristics of load payback and to changes in market price volatility and spikes.