Quantifying flexibility and optimizing energy communities’ participation in energy markets through dispatch strategies: A Finnish case study

Abstract

The role of energy communities that utilize renewable energy sources is gaining attention in promoting sector coupling and carbon neutrality. Cost-effective operation of these communities requires novel tools to optimize electricity and heat generation, assess available flexibility, and reduce operational costs. This study presents a novel two-level optimization framework for a Finnish energy community to quantify flexibility, design optimal power dispatching strategies, and maximizes profits by participating in the day-ahead energy market. The proposed energy community integrates batteries, solar panels, fuel cells, a heat accumulator, gas boilers, and combined heat and power engines for electricity and heat generation. The problem is formulated as a mixed-integer linear programming model, integrating unit commitment and economic dispatch optimization concepts. In the first level, the framework determines the optimal water mass flow for district heating network to meet heat demand. If demand cannot be met by adjusting the mass flow alone, the second level optimizes the temperature of the supply water to satisfy the remaining heat demand. A case study is presented to demonstrate the novelty and applicability of the framework in managing future energy communities, quantifying flexibility, and improving decision-making.