A Flexible Contract Mechanism for Peak Regulation Auxiliary Services Considering Optimal Utilization of Demand-Side Regulation Resources

The peak regulation auxiliary service plays an important role in utilizing flex-ibility of generations/loads and balancing the output and demand. At pre-sent, the regulation resources in the demand side has limited incentives to participate in the peak regulation market, which restricts the reduction of the peak regulation cost. This paper proposes a pricing mechanism for the peak regulation auxiliary service based on a flexible contract that considers the optimal utilization of demandside regulation resources. The mechanism fair-ly determines the day-ahead price of the option for peak regulation capacity, which improves the enthusiasm of demand-side market participants, and in-centivizes more regulation resources to participate in the day-ahead peak regulation market. Then, the optimal bidding model of market participants, i.e., thermal power units and demand-side resource aggregators, is proposed. The clearing model of the peak regulation auxiliary service market is constructed under the proposed mechanism. Numerical results shows that the proposed flexible contract has the characteristics of incentive and fairness, which encourages the demand-side regulation resources to eliminate the un-certainties of renewable power and reduce the peak regulation cost.