Bidding Strategies for Battery Energy Storage Addressing Uncertain Market Clearance

Charging during the off-peak hours and discharging during the peak hours could be profitable for the battery energy storage owners to participate in the wholesale electricity energy markets. Meanwhile, this promotes investment in battery energy storage, accommodating renewable generation intermittency, reducing fossil energy production, and finally achieving 100% clean energy production for the whole society. Albeit the overall benefit, the operational practice at different wholesale markets, in particular, the uncertain market clearance behavior, causes potential inconvenience and challenges for the owners to submit energy bidding offers, which affects the overall performance of market participation activities in terms of total profit. In this paper, we first explore innovative bidding strategies to maximize the expected profit of the battery energy storage owners under market clearance uncertainty. More specifically, We explore different models to derive optimal bidding strategies for three different market clearance settings for battery energy storage. Then, we propose an innovative general network-flow model that is capable of addressing all three different common market clearance settings. The final case studies for the proposed models are implemented based on the real-world data and the results show the advantages of our developed innovative network-flow model for the battery energy storage bidding, through both one-time and rolling-horizon validations.