A Method for Determining Optimal Parameters in Aggregation of Distributed Energy Resources

This paper presents a method to calculate parameters for aggregating distributed energy resources (DERs), especially electricity consumption of customers. In DER aggregation, energy resource aggregators reward customers complying with requests of demand response. On the other hand, the aggregators need to financially offset opportunity losses of retail electricity suppliers caused by the DER aggregation. This is the negawatt compensation. In the authors' proposal, electricity trading is expressed as a problem of social welfare maximization, allowing changes in the profits of aggregators, retailers, and customers to be measured. As a result, the unit prices of monetary rebate to customers and negawatt compensation to retailers can be calculated mathematically.