Industrial consumers’ electricity market participation options: A case study of an industrial cooling process in Denmark

In a deregulated market context, industrial consumers often have multiple market participation options available to bid their flexible consumption in electricity markets and thereby reduce their electricity bill. Yet most participation strategies for demand response are developed in a fixed and predefined set of submarkets. Meanwhile, little literature has compared multiple market options for market participants. Therefore, this paper proposes a comparative approach between available market options to evaluate savings from different market participation options. More specifically, this study implements an optimisation program in Python to investigate the impacts of changes in an industrial process’ flexibility on savings with different market participation options. The optimisation program is tested with a case study of an industrial cooling process in three Danish submarkets (day-ahead, intraday, and regulating power markets). The market participation options are formed by different combinations of these three submarkets, and the type and amount of process flexibility are varied by changing time and load constraints in the optimisation program. The results show that bidding in market options with multiple submarkets yields higher savings than single-market bidding, but that increases in available flexibility impact savings in each market option differently. Increased flexibility will only bring additional savings if it allows to take further advantage of price variations in a market option. Additionally, increases in savings with flexibility depend on the considered type of flexibility. These changes in relative savings between market options at each flexibility level imply that the optimal market option is not a static choice for a process with variable operating conditions. The optimal market option for an industrial consumer depends not only on market price signals, but also on the type and amount of available flexibility.