Adaptive optimization of BESS and grid set points: A model-free framework for energy management under dynamic tariff pricing

This paper introduces an enhanced framework for managing Battery Energy Storage Systems (BESS) in residential communities. The non-convex BESS control problem is first addressed using a gradient-based optimizer, providing a benchmark solution. Subsequently, the problem is tackled using multiple Deep Reinforcement Learning (DRL) agents, with a specific emphasis on the off-policy Soft Actor-Critic (SAC) algorithm. This version of SAC incorporates reward refinement based on this non-convex problem, applying logarithmic scaling to enhance convergence rates. Additionally, a safety mechanism selects only feasible actions from the action space, aimed at improving the learning curve, accelerating convergence, and reducing computation times. Moreover, the state representation of this DRL approach now includes uncertainties quantified in the entropy term, enhancing the model’s adaptability across various entropy types. This developed system adheres to strict limits on the battery’s State of Charge (SOC), thus preventing breaches of SOC boundaries and extending the battery lifespan. The robustness of the model is validated across several Australian states’ districts, each characterized by unique uncertainty distributions. By implementing the refined SAC, the SOC consistently surpasses 50 percent by the end of each day, enabling the BESS control to start smoothly for the next day with some reserve. Finally, this proposed DRL method achieves a mean reduction in optimization time by 50 percent and an average cost saving of 40 percent compared to the gradient-based optimization benchmark. • DRL-driven BESS control reduces electricity costs by 40% under dynamic tariff conditions. • Entropy-based uncertainty quantification improves action robustness in BESS management. • Introduced safety mechanism in DRL ensures SOC limits, extending battery lifespan. • DRL approach achieves 50% reduction in optimization time compared to gradient-based methods. • Proposed framework validated across diverse regions, showing adaptability to varying uncertainties.