Opportunities for Price Manipulation by Aggregators in Electricity Markets
Aggregators of distributed generation are playing an increasingly crucial role in the integration of renewable energy in power systems. However, the intermittent nature of renewable generation makes market interactions of aggregators difficult to monitor and regulate, raising concerns about potential market manipulation by aggregators. In this paper, we study this issue by quantifying the profit an aggregator can obtain through strategic curtailment of generation in an electricity market. We show that, while the problem of maximizing the benefit from curtailment is hard in general, efficient algorithms exist when the topology of the network is radial (acyclic). Further, we highlight that significant increases in profit are possible via strategic curtailment in practical settings.
© 2017 IEEE. Manuscript received June 28, 2016; revised November 21, 2016 and February 28, 2017; accepted April 5, 2017. Date of publication April 13, 2017; date of current version October 19, 2018. This work was supported in part by NSF under Grant 1545096 (as part of the NSF/DHS/DOT/NASA/NIH Cyber-Physical Systems Program), Grant NeTS-1518941, Grant AitF-1637598, and Grant EPAS-1307794. Paper no. TSG-00866-2016. (Navid Azizan Ruhi and Krishnamurthy Dvijotham contributed equally to this work.)
Submitted - 1606.06510.pdf