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Electric Vehicle Virtual Power Plant Dilemma: Grid Balancing Versus Customer Mobility

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  • Micha T. Kahlen
  • Wolfgang Ketter
  • Jan van Dalen

Abstract

Virtual power plants (VPP) play a crucial role in balancing the electricity smart grid. VPPs aggregate energy from decentralized sources, for example, biogas, solar panels, or hydropower, to generate and consume electricity on demand. We study the management of electric vehicle (EV) fleets organized in VPPs as a way to address the challenges posed by the inflexible energy supply of renewable sources. In particular, we analyze the potential of parked EVs to absorb electricity from the grid, and provide electricity back to the grid when needed. A fleet owner can either charge, discharge for renting, discharge to the grid, or keep an EV idle. A unique property of our mixed rental‐trading strategy is that decisions are made between making an EV available for rental, where the location within the city matters (drivers want a car to be close to their place of departure or arrival) and for discharging it to the grid, where location does not matter (vehicles can discharge to the grid from any capable charging point). We study the feasibility of VPPs for a fleet of 1500 real EVs on the “Nord Pool Spot,” a North European electricity spot market. A Fourier series approach captures the demand patterns of carsharing vehicles accurately, especially when our weighted objective function with asymmetric payoffs is applied. We show that the VPP can be profitable to fleet owners, ecologically advantageous through reductions in wind power curtailment, and beneficial to consumers by reducing energy expenses.

Suggested Citation

  • Micha T. Kahlen & Wolfgang Ketter & Jan van Dalen, 2018. "Electric Vehicle Virtual Power Plant Dilemma: Grid Balancing Versus Customer Mobility," Production and Operations Management, Production and Operations Management Society, vol. 27(11), pages 2054-2070, November.
    • Handle: RePEc:bla:popmgt:v:27:y:2018:i:11:p:2054-2070
    DOI: 10.1111/poms.12876
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    1. Jose Esteves & Daniel Alonso-Martínez & Guillermo de Haro, 2021. "Profiling Spanish Prospective Buyers of Electric Vehicles Based on Demographics," Sustainability, MDPI, vol. 13(16), pages 1-22, August.
    2. Konstantina Valogianni & Wolfgang Ketter & John Collins & Dmitry Zhdanov, 2020. "Sustainable Electric Vehicle Charging using Adaptive Pricing," Production and Operations Management, Production and Operations Management Society, vol. 29(6), pages 1550-1572, June.
    3. Amit Kumer Podder & Sayemul Islam & Nallapaneni Manoj Kumar & Aneesh A. Chand & Pulivarthi Nageswara Rao & Kushal A. Prasad & T. Logeswaran & Kabir A. Mamun, 2020. "Systematic Categorization of Optimization Strategies for Virtual Power Plants," Energies, MDPI, vol. 13(23), pages 1-46, November.
    4. Fügener, A. & Grahl, J. & Gupta, A. & Ketter, W., 2019. "Cognitive challenges in human-AI collaboration: Investigating the path towards productive delegation," ERIM Report Series Research in Management ERS-2019-003-LIS, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    5. Cai, Qiran & Qing, Jing & Xu, Qingyang & Shi, Gang & Liang, Qiao-Mei, 2024. "Techno-economic impact of electricity price mechanism and demand response on residential rooftop photovoltaic integration," Renewable and Sustainable Energy Reviews, Elsevier, vol. 189(PB).
    6. Nicholas Gurieff & Donna Green & Ilpo Koskinen & Mathew Lipson & Mark Baldry & Andrew Maddocks & Chris Menictas & Jens Noack & Behdad Moghtaderi & Elham Doroodchi, 2020. "Healthy Power: Reimagining Hospitals as Sustainable Energy Hubs," Sustainability, MDPI, vol. 12(20), pages 1-17, October.
    7. Lingling Shi & Suresh P. Sethi & Metin Çakanyıldırım, 2022. "Promoting electric vehicles: Reducing charging inconvenience and price via station and consumer subsidies," Production and Operations Management, Production and Operations Management Society, vol. 31(12), pages 4333-4350, December.
    8. Dawid Chudy & Adam Leśniak, 2021. "Advantages of Applying Large-Scale Energy Storage for Load-Generation Balancing," Energies, MDPI, vol. 14(11), pages 1-17, May.
    9. Gilbert Fridgen & Marc-Fabian Körner & Steffen Walters & Martin Weibelzahl, 2021. "Not All Doom and Gloom: How Energy-Intensive and Temporally Flexible Data Center Applications May Actually Promote Renewable Energy Sources," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 63(3), pages 243-256, June.
    10. Ekaterina Abramova & Derek Bunn, 2021. "Optimal Daily Trading of Battery Operations Using Arbitrage Spreads," Energies, MDPI, vol. 14(16), pages 1-23, August.
    11. Wolfgang Ketter & Karsten Schroer & Konstantina Valogianni, 2023. "Information Systems Research for Smart Sustainable Mobility: A Framework and Call for Action," Information Systems Research, INFORMS, vol. 34(3), pages 1045-1065, September.
    12. Carlos Armenta-Déu & Laura Demas, 2024. "Optimization of Grid Energy Balance Using Vehicle-to-Grid Network System," Energies, MDPI, vol. 17(5), pages 1-28, February.
    13. van Heck, Eric, 2019. "Big Data e disrupções nos modelos de negócios," RAE - Revista de Administração de Empresas, FGV-EAESP Escola de Administração de Empresas de São Paulo (Brazil), vol. 59(6), December.
    14. Fridgen, Gilbert & Keller, Robert & Körner, Marc-Fabian & Schöpf, Michael, 2020. "A holistic view on sector coupling," Energy Policy, Elsevier, vol. 147(C).
    15. Osorio-Aravena, Juan Carlos & Aghahosseini, Arman & Bogdanov, Dmitrii & Caldera, Upeksha & Ghorbani, Narges & Mensah, Theophilus Nii Odai & Haas, Jannik & Muñoz-Cerón, Emilio & Breyer, Christian, 2023. "Synergies of electrical and sectoral integration: Analysing geographical multi-node scenarios with sector coupling variations for a transition towards a fully renewables-based energy system," Energy, Elsevier, vol. 279(C).
    16. Kamran Taghizad-Tavana & As’ad Alizadeh & Mohsen Ghanbari-Ghalehjoughi & Sayyad Nojavan, 2023. "A Comprehensive Review of Electric Vehicles in Energy Systems: Integration with Renewable Energy Sources, Charging Levels, Different Types, and Standards," Energies, MDPI, vol. 16(2), pages 1-23, January.
    17. Gust, Gunther & Schlüter, Alexander & Feuerriegel, Stefan & Úbeda, Ignacio & Lee, Jonathan T. & Neumann, Dirk, 2024. "Designing electricity distribution networks: The impact of demand coincidence," European Journal of Operational Research, Elsevier, vol. 315(1), pages 271-288.
    18. Oliver Thomas & Simon Hagen & Ulrich Frank & Jan Recker & Lauri Wessel & Friedemann Kammler & Novica Zarvic & Ingo Timm, 2020. "Global Crises and the Role of BISE," Business & Information Systems Engineering: The International Journal of WIRTSCHAFTSINFORMATIK, Springer;Gesellschaft für Informatik e.V. (GI), vol. 62(4), pages 385-396, August.
    19. Andrés E. Díez & Mauricio Restrepo, 2021. "A Planning Method for Partially Grid-Connected Bus Rapid Transit Systems Operating with In-Motion Charging Batteries," Energies, MDPI, vol. 14(9), pages 1-22, April.

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