Optimizing CHP Plant Flexibility in Energy and Ancillary Service Markets

CHP plants have the ability to provide ancillary services and therefore contribute to the improvement of flexibility and reliability of the power system. This work presents a model-based approach for estimating overall revenue for participating in both energy and frequency regulation markets. The integration of the thermal energy storage can further increase the capability of CHPs in providing flexibility services. A security constrained economic dispatch with the income from frequency regulation market is proposed to determine optimal operating strategies of a CHP plant with thermal energy storage (TES). The total profit of participating in both energy and regulation markets is maximized in consideration of power and heat revenues, fuel cost, energy storage, frequency regulation capability and revenue. The benefit from providing CHP flexibility is demonstrated through simulation for a medium-sized CHP plant with TES of a Swedish energy company, highlighting its ability to merge frequency regulation capability with cost reducing objectives of traditional CHP plant supplying heat and electric energy