A Multi-Stage Strategy for Harnessing Congestion Management Services from Industrial Hubs in Local and System-level Markets

Abstract

This paper introduces a multi-stage coordination model incorporating industrial hubs, distribution system operators (DSOs), and the transmission system operator (TSO) into separate stages within a hierarchical optimization framework. In this concept, the hubs incorporate electrical, thermal, and cooling storage systems, enabling them to participate in integrated demand response (IDR) programs. This model effectively harnesses the flexible capacities of industrial hubs in congestion management (CM) markets, integrating dispatchable units and battery storage systems under their management, thereby facilitating the transfer of flexibility from distribution-level to transmission-level markets. The proposed model is implemented using GAMS on the IEEE 14-bus transmission network, connected to two IEEE 21-bus distribution networks at buses 5 and 9. Simulation results demonstrate that the proposed decentralized scheme significantly reduces CM costs at both the TSO and DSO levels, while also increasing the daily profits of the hubs from CM markets.