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Optimized Decision-Making for Multi-Market Green Power Transactions of Electricity Retailers under Demand-Side Response: The Chinese Market Case Study

Author

Listed:
  • Hui Wang

    (College of Economics and Management, Shanghai University of Electric Power, Shanghai 200090, China)

  • Yao Xu

    (College of Economics and Management, Shanghai University of Electric Power, Shanghai 200090, China)

Abstract

With the energy structure transition and the development of the green power market, the role of electricity retailers in multi-market green power trading has become more and more important. Particularly in China, where aggressive green energy policies and rapid market transformations provide a distinct context for such studies, the challenges are pronounced. Under demand-side response, electricity retailers face the uncertainty of users’ electricity consumption and incentives, which complicates decision-making processes. The purpose of this paper is to explore the optimization decision-making problem of multi-market green power trading for electricity retailers under demand-side response, with a special focus on the Chinese market due to its leadership in implementing substantial green energy initiatives and its potential to set precedents for global practices. We first construct a two-party benefit optimization model, which comprehensively considers the profit objectives for electricity retailers and utility maximization for users. Then, the model is solved by the Lagrange multiplier method and distributed subgradient algorithm to obtain the optimal solution. Finally, the effectiveness of the incentive optimization strategy under the multi-market to promote green power consumption and improve the profit of electricity retailers is verified by arithmetic simulation. The results of this study show that the incentive optimization strategy under multi-market, particularly within the Chinese context, is expected to provide a reference for electricity retailers to develop more flexible and effective trading strategies in the green power market and to contribute to the process of promoting green power consumption globally.

Suggested Citation

  • Hui Wang & Yao Xu, 2024. "Optimized Decision-Making for Multi-Market Green Power Transactions of Electricity Retailers under Demand-Side Response: The Chinese Market Case Study," Energies, MDPI, vol. 17(11), pages 1-16, May.
    • Handle: RePEc:gam:jeners:v:17:y:2024:i:11:p:2543-:d:1401224
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    References listed on IDEAS

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