562 IEEE TRANSACTIONS ON SUSTAINABLE ENERGY, VOL. 7, NO.

2, APRIL 2016

Control and Bidding Strategy for Virtual Power

Plants With Renewable Generation and Inelastic
Demand in Electricity Markets
Qianchuan Zhao, Senior Member, IEEE, Ying Shen, Student Member, IEEE, and Mingyang Li, Member, IEEE

AbstractA virtual power plant (VPP), aggregating the capac- tW , tL Standard deviations of wind generation and
ities of distributed energy resources (DER) as a single profile, demand forecast errors at time t.
can facilitate cost-efficient integrations of DERs into electricity
markets. In this paper, we investigate the control and bidding
CVW L
t , CVt Normalized standard deviations of wind genera-
problem of VPPs, which consist of renewable distributed gen- tion and demand forecast errors at time t.
erators (RDGs) and consumers with inelastic demand. As both WtU , WtC Wind power usage and curtailment at time t,
renewable generation and inelastic demand cannot be scheduled which are random variables.
and accurately forecasted, a novel coordinated strategy on renew- t Predefined upper limit of the ratio of wind power
able power usage is proposed. To minimize the cost of VPP in
the day-ahead and the balancing markets, a stochastic bilevel
usage to demand at time t in our coordinated
optimization problem is formulated with decision variables being control strategy.
renewable power usages and day-ahead bids. Due to the unimodal- A Ratio of WI and the minimum demand of cus-
ity of the objective function, the problem can be greatly simplified tomers.
and solved by local optimization algorithms. The performance of kt Absolute power limit of wind power usage at
proposed strategy has been numerically assessed and compared
with other commonly used strategies. Results show that our strat-
time t in the absolute control strategy.
egy leads to much lower expected costs than others. Moreover, it Nt Actual power exchange with market at time t,
can be combined with flexible resources to further improve the which is a random variable.
performance. Bt Day-ahead bid of power exchange with market
at time t.
Index TermsRenewable energy resources, inelastic demand,
electricity markets, virtual power plant, distributed energy t Deviation between actual power exchange and
resources. the bid at time t.
Ct Total cost in both the day-ahead market and the
balancing market at time t.
N OTATIONS Ctr Cost incurred in the balancing market at time t.
Wt , L t Actual wind power generation and demand at Ctr Imbalance cost at time t.
time t, which are random variables. st Spot price at time t.
W t , Lt Forecasted wind power generation and demand +t Up-regulation price at time t.
at time t. t Down-regulation price at time t.
W L
t , t Forecast errors of wind power generation and pt Relative difference between spot price and up-
demand at time t. regulation price at time t.
qt Relative difference between spot price and
Manuscript received January 31, 2015; revised June 28, 2015 and September down-regulation price at time t.
24, 2015; accepted November 27, 2015. Date of publication December 25, t Random vector, which is formed by random spot
2015; date of current version March 18, 2016. This work was supported in part price, random relative differences between spot
by the National Natural Science Foundation of China under Grant 61425027,
in part by the State Key Laboratory of Alternate Electrical Power System with price and regulation prices at time t.
Renewable Energy Sources (North China Electric Power University) under
Grants LAPS15007 and LAPS14014, in part by the National Science and
Technology Support Program (2013BAG18B00), and in part by the Innovation I. I NTRODUCTION
Joint Research Center for Cyber-Physical-Society System. Paper no. TSTE-
00059-2015.
Q. Zhao and Y. Shen are with the Center for Intelligent and
Networked Systems, Department of Automation, TNList, Tsinghua
T HE ever-increasing energy demand, pressing environ-
mental issues and economic considerations have called
for the utilization of Renewable Energy Resources (RESs), such
University, Beijing 100084, China (e-mail: zhaoqc@tsinghua.edu.cn; as wind and solar power. Many countries have set up incentive
sheny11@mails.tsinghua.edu.cn).
M. Li is with the School of Control and Computer Engineering, State policies to promote the generation from RESs, which results
Key Laboratory of Alternate Power Systems with Renewable Energy Sources, in a significant growth of Renewable Distributed Generators
North China Electric Power University, Beijing 102206, China (e-mail: (RDGs) in the past decade [1]. With the liberalization of elec-
limy@ncepu.edu.cn). tricity market, RDGs will have the opportunities to participate
Color versions of one or more of the figures in this paper are available online
at http://ieeexplore.ieee.org. in energy markets and provide ancillary services to system oper-
Digital Object Identifier 10.1109/TSTE.2015.2504561 ators. However, due to the stochastic characteristics of energy
1949-3029 2015 IEEE. Personal use is permitted, but republication/redistribution requires IEEE permission.
See http://www.ieee.org/publications_standards/publications/rights/index.html for more information.
ZHAO et al.: CONTROL AND BIDDING STRATEGY FOR VIRTUAL POWER PLANTS
generated from RDGs, the high risk of not meeting the accepted
schedules makes the market participation of RDGs impossible.
This challenge can be met by using the framework of Virtual
Power Plant (VPP). VPP aggregates the capacity of many
diverse Distributed Energy Resources (DER) and creates a sin-
gle operating profile [2], [3]. In this way, individual DERs
can gain the visibility and controllability to system operators
and make contracts in the wholesale market. Moreover, bene-
fited from VPP market strategies, individual DERs can further
optimize their positions in the market and maximize their prof-
its. In Fenix Project [4], two types of VPP are defined: the
Commercial VPP (CVPP) and the Technical VPP (TVPP).
CVPP acts in the electricity market context. It has an aggre-
gated profile and output which represents the cost and operating
characteristics for the DER portfolio. CVPP is responsible for
trading in the wholesale energy market and passing the oper-
ating schedules to TVPP. The impact of distribution network
is not considered in the aggregated CVPP profile. TVPP acts
in the system operation context. It is engaged in local system
managements and providing balancing and ancillary services
for transmission system operators. The influence of local net-
work on the aggregated profile and operating characteristics of
the portfolio are included in TVPP.
This paper investigates a CVPP which consists of RDGs
and users with inelastic demand. It is considered as a partici-
pant of the day-ahead and balancing markets with the aim of
minimizing its cost (or maximizing its profit). An example is
the distribution company, which owns both RDGs and users
in its territory. With the development of smart grid, users can
offer a certain capacity of elastic demand to system operators.
However, the elasticity of demand is small or even negligible
in many areas [5]. There are three reasons: (1) residential con-
sumers will probably not reduce their comfort and convenience
to cut their electricity bills by a few percents; (2) commercial
customers may not have enough motivations to participate in
demand managements, considering the initial cost for installing
communication and control devices, and the subsequent cost
for maintenance and operation; (3) industrial consumers will
not reduce their production drastically to save a small amount
of electricity costs. Therefore, it is important to consider the
combination of RDGs and inelastic demand to improve the
penetration of renewable power in the whole grid.
In literature, researchers have adopted a variety of flexible
resources, such as dispatchable power plant, storage, and elas-
tic demand, to reduce the imbalance power caused by renewable
uncertainties. For example, scheduling dispatchable generators
to compensate the renewable power shortfall [6][9], deploy-
ing storage to absorb uncertainties [10][12], and adjusting
elastic demand to follow the renewable generation fluctuation
[13][16]. Since flexible resources are able to handle uncer-
tainties, renewable power is usually treated as negative load
and fully utilized in these models. For the VPP with RDGs
and inelastic demand, reducing the market cost is a challenging
problem, since both renewable generation and demand cannot
be scheduled and accurately forecasted. One promising way
is curtailing some of the renewable generation to reduce the
expensive imbalance cost. A recent work [17] has shown that
renewable energy curtailment could help reduce the imbalance
563
cost of VPP. However, it doesnt consider the optimization of
day-ahead bids. The bidding model represented in [18] includes
the scheduling of power generated from RDGs, while it does
not consider the balancing market, since flexible resources are
used to provide reserve capacities.
Being complementary to the existing research, this paper
investigates the renewable control and bidding problem of VPP
in both day-ahead market and balancing market. We propose a
novel control strategy on renewable power usage, which limits
the ratio of renewable power usage to demand by a predefined
upper limit. Considering the uncertainties of renewable gener-
ation, demand and market prices, we formulate the problem
of minimizing VPPs market cost as a stochastic bilevel opti-
mization. This model allows the VPP operator to determine the
optimal renewable power usage and day-ahead sale/purchase
bids for each time unit of the coming day. Due to the unimodal-
ity of the objective function, local optimization algorithms are
used to solve the problem. In case study, our proposed strategy
is compared with two commonly used strategies: (a) the greedy
strategy, which fully utilizes the renewable power; (b) the abso-
lute strategy [19], which limits the renewable power usage to a
predefined power value. Four typical cases with different pro-
files of forecast renewable generation and forecast demand are
used to assess their performances. Moreover, the market costs
under VPP and non-VPP frameworks are evaluated and com-
pared in discussion. Furthermore, the relations between our
strategy and flexible resources, storage and elastic load, are
analyzed.
The main contribution of this paper is: 1) we propose a novel
strategy on wind power usage, which provides an alternative
way for VPPs to reduce their market costs, especially, in the
situations of no available flexible resources; 2) we formulate
the problem of minimizing VPPs market cost as a stochas-
tic bilevel optimization, and significantly simplify the problem
so that it can be solved by local optimization algorithms. The
advantage of proposed strategy is: 1) it can achieve a lower
cost than the absolute and the greedy strategies by exploring the
potential of uncertainty offset between generation and load; 2) it
can substitute a certain capacity of storage or elastic load, and
thus save the related initial costs, especially the expensive capi-
tal cost of storage; 3) it can be combined with flexible resources
to further improve the performance.
The rest of this paper is organized as follows. Section II
describes system components and proposes a new control
strategy. Section III formulates the optimization problem.
Section IV presents the solution methodology. Section V con-
ducts a numerical study. Section VI concludes this paper.
II. S YSTEM D ESCRIPTION AND A N EW C ONTROL
S TRATEGY
A CVPP which consists of distributed wind generators, dis-
tributed users, and an operator is considered in this paper. It
is connected to the external grid and can exchange power with
it, either import or export. The generation or demand capaci-
ties of DERs are aggregated to create a single VPP profile in
the market. The active power components and the power flow
directions are presented in Fig. 1, where the RDG and Load
564
Fig. 1. Configuration of the CVPP.
indicate the aggregated capacities of wind generation and load
demand. It is assumed that the operator can receive the fore-
casting information of demand and generation, and has a direct
control on the power outputs of wind generators. Since the
bidding problem of CVPP is the focus of this paper, the techni-
cal issues related to the distribution network operation are not
included in this paper and will be studied in future.
A. Wind Generation
Due to the uncertainties of renewable resources, the actual
wind generation at time t is assumed to be equal to the forecast
value W t plus a random forecast error W
t , i.e.
Wt = W t + W
t , (1)
where W t is assumed to be a normally distributed variable
with standard deviation tW [18]. tW can be identified by the
least-square fitting, which minimizes the difference between the
standard deviation of sample forecast, based on the actual data,
and the modeled standard deviation. Generally, it is affected
by prediction methods, forecast time horizons, meteorologi-
cal conditions, etc., among which the forecast time horizon is
regarded as the most critical factor. For instance, [20][22] have
demonstrated that tW is a function of the normalized predic-
tion power, the forecast horizon, and the size of region where
the wind turbines are located.
B. Load
Similarly, the actual load at time t is modeled as the sum of
the forecast value Lt and a random forecast error Lt , i.e.
Lt = L t + L
t , (2)
where Lt is a normally distributed random variable with stan-
dard deviation tL . The standard deviation can be estimated
from historical load data by the curve fitting. Moreover, cus-
tomer behaviors under different weather conditions can also be
considered to obtain a more accurate estimation. Distribution
network loss, regarded as a part of system load, is included in
the load term.
IEEE TRANSACTIONS ON SUSTAINABLE ENERGY, VOL. 7, NO. 2, APRIL 2016
C. Wind Power Usage and Control Strategy
As analyzed in [23], [24], it is necessary to curtail some
wind generation so as to reduce the imbalance cost when there
is overproduction in the whole system. Since we do not con-
sider the storage in this work, the unused wind power is spilled.
Denote the used wind power at time t as WtU . Our proposed
coordinated strategy and two commonly used strategies, the
greedy strategy and the absolute strategy, are introduced in the
following.
1) Coordinated Strategy: Considering the stochastic
natures of both wind power generation and demand, we
propose a coordinated control strategy which limits the ratio of
wind power usage to demand at time t by a predefined upper
limit t , i.e.
WtU = min(Wt , t Lt ), t [0, A], (3)
where A is a constant which represents the upper bound of the
ratio of used wind power and load. When t is set as A, wind
power generation is always fully utilized. In a specific system,
A is set as the ratio of the maximum value of wind generation
and the minimum value of load which are obtained from the
historical data.
The proposed strategy works as follows: if the actual wind
power generation exceeds t Lt , the wind power usage will be
t Lt and the excess wind power Wt t Lt will be curtailed;
whereas if it is not greater than t Lt , the wind generation will
be fully used.
In general, the prediction of wind power generation has no
correlation with the prediction of demand, thus Wt and Lt are
unrelated random variables. According to the proposed control
strategy, a positive correlation between wind power usage and
the demand is built, thus the offset between their uncertainties
can be utilized to reduce the uncertainty of power exchange as
well as the risk of imbalance penalty. Obviously, the smaller the
control parameter t is, the stronger their positive correlation
will be.
2) Greedy Strategy: The greedy strategy fully utilizes wind
power generation at time t, i.e.
WtU = Wt . (4)
Note that the greedy strategy is a special case of our strategy
where the control parameter t is fixed as A.
3) Absolute Strategy: The absolute strategy, which has
been used in the current transmission network [19], limits the
wind power usage at time t to a predefined power value kt , i.e.
WtU = min(Wt , kt ), kt [0, WI ], (5)
where WI is the installed capacity of wind generators, kt is
the control parameter. It should be pointed out that the abso-
lute strategy is also a special case of our strategy when the
demand forecast error is zero. Although the absolute strategy
can also reduce the uncertainty of power exchange by restrict-
ing the amount of wind power usage, it has no consideration
about the demand side.
ZHAO et al.: CONTROL AND BIDDING STRATEGY FOR VIRTUAL POWER PLANTS 565

D. Power Exchange
The VPP will exchange power with the market, either as a
consumer or a producer. The actual power exchange Nt at time
t is calculated from the power balance
day. Then, the deviation between the bid (Bt ) and actual power
exchange (Nt ) are settled in the balancing market.
The market cost of VPP proposing a bid Bt but actually
consuming Nt at time t can be formulated as

Ct = st Bt + Ctr , (7)
Nt = Lt WtU . (6)
where st is the spot price at time t; Ctr is the cost incurred in
Positive values of Nt represents the power imports, negative
the balancing market at time t. The deviation between the actual
values of Nt represents the power exports. It is clear that the
power exchange and the bid is
uncertainty of Nt comes from the uncertainties of demand
and wind power usage. Its probability distribution depends on t = Nt Bt , (8)
the distributions of wind generation and load, and the control
strategy. To simplify the analysis, the transmission capacity and Ctr is given by
constraints are not considered in this paper. 
+
t t , t 0
Ctr = , (9)

t t , t < 0
III. P ROBLEM F ORMULATION
where the positive deviation t 0 indicates the power short-
In this section, we give a description about the electric- age, as the actual consumption is larger than the bidding
ity market structure in subsection A; formulate the market consumption (or the actual production is less than the bidding
cost of VPP in subsection B; model the uncertainty of market production); the negative deviation t < 0 indicates the power
prices in subsection C; and present the optimization problem in surplus, as the actual consumption is less than the bidding con-
subsection D. sumption (or the actual production is larger than the bidding
production); +
t and t are the regulation prices for purchas-
ing (up-regulation) and selling (down-regulation) electricity in
A. The Electricity Market
the balancing market at time t, respectively.
In European electricity pools, such as Nord pool and Dutch Eq. (7) can be reformulated as
pool, a payment for a commitment in the day-ahead market is
made at first, then any deviations are paid in the balancing mar- Ct = st Nt + Ctr , (10)
ket. In the day-ahead (spot) market, participants propose their
where
bids for each hour of the coming day before the gate closure. 
After the spot price has been settled and commitments have (+ s
t t )t , t 0
Ctr = . (11)
been made, participants are responsible for deviations from (t st )t , t < 0
their commitments made in the day-ahead market. Any devi-
Eq. (10) means that the market cost of VPP is the combination
ation will be settled in the balancing (regulation) market via the
of the cost for purchasing actual power exchange Nt at spot
regulation price. If the actual consumption is more than (or pro-
price and the cost for regulation. In the following part of paper,
duction is less than) the commitment, the power shortage will
Ctr is called the imbalance cost.
be purchased in balancing market at the up-regulation price,
which is usually higher than the spot price. If the consumption
is less than (or production is more than) the commitment, the C. Price Uncertainty
surplus energy will be sold at the down-regulation price, which
The regulation prices can be calculated as proportions of the
is usually lower than the spot price. Therefore, power deviations
spot price for that time unit, i.e.
normally results in an additional cost for participants.
As the interval between the gate closure and the begin- +
t = (1 + pt )t
s
, (12)
ning of power delivery is at least 12 hours, participants with t = (1 qt )st
unpredictable fluctuation in production or consumption usually
have to pay more regulation costs than others. This encourages where pt and qt are the relative differences between the spot
them to be more strategic in their ways of bidding. By using price and the up-regulation and down-regulation prices.
strategies, the extra costs needed to counter unpredictable fluc- The stochastic characteristics of market prices are mod-
tuations can be limited so that the profits in the market can be eled by a random vector t , which is formed by random spot
increased. price and random relative differences between spot price and
regulation prices, i.e.

B. VPP Market Cost t = [st , pt , qt ], (13)

It is assumed that the VPP participates into the two-
settlement electricity market as a price-taker player, since its
economic entity is too small to affect the market clearing price.
In the day-ahead market, the VPP submits the hourly bid Bt
of consumption (Bt > 0) or production (Bt < 0) for the next
where st , pt and qt are assumed to be independent random
variables [25]. The operator can obtain the forecast distributions
of market prices by employing forecasting techniques, which
have been broadly described in [26], [27]. As the VPP is a price
taker, market prices are independent of VPPs power exchange.
566
D. CVPP Control Decision and Bidding
We assume that the CVPP owns both the generators and
users, and acts in the interest of the whole in the market.
Therefore, the objective is to minimize the expected total cost
of CVPP in the market. Based on the information of wind gen-
eration, demand and market prices, the operator should decide
the control parameter in control strategy and the correspond-
ing day-ahead bid for each hour of the coming day. Since the
optimal bid can only be determined after the control decision
is given, the problem of minimizing expected cost at time t is
formulated as a stochastic bilevel optimization problem, i.e.
min min Et Q(t , Bt , t )
t Bt
subject to
t [0, A]
Bt WI
where
Q(t , Bt , t ) =E(Ct )

=st E(Nt ) + pt st (x Bt )fNt (x)dx
Bt
 Bt
+ qt st (Bt x)fNt (x)dx
WI
where Et denotes the expectation with respect to t , fNt is the
probability density function of Nt . Since the model is hourly
based and there is no coupling between adjacent hours, the
optimization problem for each hour is solved independently.
It is noted that when the absolute strategy is adopted, t in the
optimization problem will be replaced by kt , and the constraint
(15) will be replaced by kt [0, WI ]; when the greedy strategy
is used, the bilevel optimization degenerates to the low-level
optimization with the single decision variable of the bid.
Remark : We provide a way to extend this CVPP model
to a TVPP model. As mentioned in the introduction section,
TVPP considers the real-time influence of distribution network
on DER aggregated profile. Therefore, AC network constraints
should be added. Without loss of generality, a mathematical for-
mulation (18) is used to implicitly represent a variety of power
flow constraints [28]. The limit of bus voltage is shown by (19).
Gt 0,
i of power exchange. Since the low-level optimization admits a
Vmin Vti i
Vmax ,
i i
where Gt is the power flow equation at time t; Vmin , Vmax are
the minimum and maximum voltage limits of bus i.
This work, however, focuses on the trading of CVPP with
the two-settlement markets, and exploits the potential of mar-
ket cost reduction when applying our coordinated strategy. To
provide insights and lay theoretical foundations for the bidding
problem, we focus on the CVPP model in this paper, since con-
sidering the influence of network will increase the complexity
of problem significantly.
IV. S OLUTION M ETHODOLOGY
In this section, we present the equivalent form of original
optimization problem in subsection A; give the solution of
IEEE TRANSACTIONS ON SUSTAINABLE ENERGY, VOL. 7, NO. 2, APRIL 2016
the low-level optimization in subsection B; analyze the high-
level optimization and propose an algorithm in subsection C;
and analyze the effect of wind generation and demand forecast
errors on VPPs market costs in subsection D.
A. Equivalent Form of the Original Optimization Problem
The optimization problem formulated in (14)(17) is equiva-
lent to:

min min Q (t , Bt ) =E(Nt ) + pt (x Bt )fNt (x)dx
t Bt Bt
 Bt
(14)
+ qt (Bt x)fNt (x)dx,
WI
(20)
(15) subject to
(16) t [0, A] (21)
Bt WI (22)
where pt and q t are the expectations of pt and qt , respectively.
(For the detailed derivation, please see Appendix A). According
to the equivalent optimization problem, we can know that
the optimal decisions essentially depend on the relative dif-
(17) ferences between spot price and regulation prices, rather than
the absolute values of spot price and regulation prices. In the
objective function (20), the first term accounts for the expected
power exchange, the second and third terms account for the
normalized imbalance penalty for power deviations.
B. Solution of the Low-Level Optimization
In the low-level optimization of (20), the decision variable
Bt only appears in the second and third term of the objective
function. Therefore, under a given control decision t , the opti-
mal bid Bt is the bid that minimizes the normalized imbalance
penalty, which can be given by
pt
Bt (t ) = FNt 1 ( ) (23)
pt + q t
where FNt is the cumulative distribution function (CDF) of
Nt [29]. Eq. (23) means that the optimal bid, as a function
(18) of t , is a particular quantile of the probability distribution
(19)
unique minimum over the range of possible bid levels, local
optimization methods are sufficient to solve it.
C. Solution of the High-Level Optimization
Substitute the optimal bid (23) into (20), and the optimization
problem can be rewritten as
min Q (t , Bt (t )) (24)
t
subject to t [0, A]. Intuitively, Q (t , Bt (t )) is composed
of two parts: the expected power exchange and the minimum
imbalance penalty with the optimal bid. In order to determine
the optimal control decision t , we analyze the two terms of the
objective function in (24) in the following:
ZHAO et al.: CONTROL AND BIDDING STRATEGY FOR VIRTUAL POWER PLANTS 567

Algorithm 1. Optimizing the bid and the control parameter in

coordinated (or absolute) strategy
Input: The probability distributions of Wt , Lt , pt , qt
Output: t , Bt
1 Set t,0 0, Q0 0
2 do
3 n = n + 1;
4 Linear Search t,n in the range of [0, A];
p
5 Bt,n FNt,n 1 ( p+q );
6 Objective function value Qn Q (t,n , Bt,n );
7 while |Qn Q n 1| > ;
Fig. 2. The profiles of expected power exchange and minimum imbalance 8 t t,n ;
penalty. 9 Bt Bt,n ;
10 return t , Bt ;

1) Expected Power Exchange: The expected power

exchange E(Nt ) is a monotonically decreasing function of
control decision t , according to Eq. (6) and Theorem 4.1.
Theorem 4.1: Assume that Lt follows Normal distribution.
The expected wind power usage E(WtU ) is a monotonically
increasing function of control decision t , if the probability
distributions of Wt and Lt are given.
Proof: Please see Appendix B.  under the absolute strategy.
Although Theorem 4.1 is established under the assumption
of Lt following Normal distribution, it is also valid for other
distributions types as long as they satisfy F
(x,)
< 0, which is
a general property for many distribution types, such as Normal,
Weibull, Gamma distributions. As an example, the profile of
E(Nt ) is illustrated by the blue curve in Fig. 2 (data set as
Section V Case I t = 1).
2) Minimum Imbalance Penalty: The minimum imbalance
penalty is an initially decreasing and then rapidly increasing
function of the control parameter t . To give an example, its
profile is shown by the green curve in Fig. 2 (data set as above).
At the initial point of t = 0, this penalty is only induced from
the demand forecast errors. In the range of [0, 0.63], with the
increase of t , the penalty decreases instead of increases, which
results from the high positive correlation between the demand
and the wind power usage. On the right side of 0.63, the penalty
increases with t , since the positive correlation decreases and
the uncertainty of wind power usage increase. In the latter
part of the range, wind power is almost fully utilized, thus the
penalty tends to its maximum value.
According to the above features, we can know that there
is a tradeoff between the two parts of the objective function
in (24). As shown in Fig. 2, if all generated wind power is
fully utilized, the expected power exchange reaches its mini-
mum value while the minimum imbalance penalty reaches its
maximum value, whereas if all generated wind power is cur-
tailed, the minimum imbalance penalty reaches a relatively
small value while the expected power exchange reaches its
maximum value. Therefore, when deciding the control param-
eter t in the coordinated control strategy, the operator should
make a compromise between these two costs so as to reach the
minimum total cost.
Based on the above analyses and a large amount of numer-
ical experiments, we have observed that the objective function
in (24) is unimodal and the optimum is unique over the finite
range of t . Therefore, local optimization algorithms can be
used to solve the problem (For example, Golden section search,
Interior-point methods). We briefly describe our algorithm in
Algorithm 1, where the linear search in the MATLAB optimiza-
tion tool box is used. Note that this algorithm can also be used
to solve the optimal control parameter kt and the optimal bid
D. Effect of Forecast Errors on VPPs Market Cost
Renewable generation like wind is stochastic and difficult to
predict. Similarly, inelastic demand including lights are hard to
predict at a low aggregation level. It is necessary to understand
the impact of wind generation and load forecast errors on VPPs
market costs. We uniformly use the normalized standard devi-
ations of forecast errors, which are denoted by coefficient of
variation (CV), i.e.
CVW W
t = t /W t (25)
CVL L
t = t /Lt (26)
We have gotten two theorems as follows:
Theorem 4.2: Assume that Wt follows Normal distribution.
E(WtU ) is a monotonically decreasing function of CVW t , if W t ,
Lt , CVLt , and t are given.
Theorem 4.3: Assume that Lt follows Normal distribution.
E(WtU ) is a monotonically decreasing function of CVL t , if W t ,
Lt , CVWt , and t are given.
Proof: Please see Appendix B. 
Intuitively, as the forecasting accuracy of wind generation
or demand decreases, the wind power usage will decrease and
the VPP will purchase more power exchange from the mar-
ket. Meanwhile, it is obvious that the imbalance power and the
corresponding minimum imbalance penalty also increase with
the uncertainty of wind generation or demand. Consequently,
the total cost raises with the increase of CVW L
t or CVt . In
W L
Section V, the impacts of CVt and CVt on the performances
of different strategies will be further investigated by numerical
examples.
568
Fig. 3. The profiles of forecast wind generation in strong and weak wind
conditions.
Fig. 4. The profiles of forecast demand in winter and summer.
V. C ASE S TUDY
In this section, we describe the case in subsection A; present
the comparison results in subsection B; compare the VPP and
the non-VPP frameworks, and analyze the relations between
our strategy and storage as well as elastic load in subsection C.
A. Case Description
The VPP presented in this case study consists of distributed
users and distributed wind generators with total capacity of
20MW. The time unit is one hour. To better illustrate the perfor-
mance of different strategies, four typical cases with different
profiles of forecast wind generation and forecast demand are
used:
(I) strong wind and summer load;
(II) strong wind and winter load;
(III) weak wind and summer load;
(IV) weak wind and winter load.
The forecast wind generation is obtained from the data pro-
vided by BPA [30]. The data has been scaled down such that
the installed capacity is 20MW and is shown in Fig. 3. The
forecast demand are the average values of residential demand
in the Southern California Edison (SCE) service area during
the winter and summer of 2014 [31], which are shown in Fig. 4.
The normalized standard deviations of demand and wind gen-
eration forecast errors are increasing functions of the prediction
time horizon, which are depicted in Fig. 5. Since the wind gen-
eration in a small area has less smoothing effect than the one
in a large area [22], the wind generation forecast error is set
to be relatively large. According to the historical data of wind
generation and demand, the parameter A in Eq. (15) is set as 3.
The historical data of spot, up-regulation, down-regulation
prices of Dutch electricity pool provided by [32] are used to
IEEE TRANSACTIONS ON SUSTAINABLE ENERGY, VOL. 7, NO. 2, APRIL 2016
Fig. 5. Normalized standard deviation of wind generation/demand forecast
errors as an increasing function of prediction time horizon.
simulate the market situation. Since the optimal decisions do
not depend on the value of spot price, which has been analyzed
in Section IV-A, we set the spot price in each hour as 30$/MWh.
The relative difference pt is set to be uniformly distributed in
[0.1, 0.8] and qt is set to be uniformly distributed in [0.8, 1.5].
The gate closure in the day-ahead market is at 11:00 for the
coming day.
B. Comparison With Other Strategies
In this section, the performances of the coordinated strat-
egy, the absolute strategy and the greedy strategy are assessed
and compared in the above four typical cases. For each hour
of each case, we solve the optimization problems under these
three strategies, respectively. Summing the optimal results of
24 hours gives the optimal results for each case, which is shown
in Table I. (For the detailed solutions of each hour, please see
Table IV in Appendix C). We can observe that both the coor-
dinated strategy and the absolute strategy result in statistically
lower total costs than the greedy strategy for all cases. It demon-
strates that curtailing some wind power can reduce the total
cost in the market. Compared with the other two strategies,
the coordinated strategy leads to higher bids and higher costs
in the day-ahead market, but it results in much lower costs
in balancing market. Therefore, the total cost under coordi-
nated strategy is lowest. Moreover, the wind power utilization
of coordinated strategy is no less than 93%, which is accept-
able for VPP to comply with some renewable energy utilization
regulations (e.g. Renewable Portfolio Standards (RPSs)).
To further compare the absolute strategy and the coordi-
nated strategy, we plot the cost differences between the abso-
lute/coordinated strategy and the greedy strategy for each case
in Fig. 6. It can be observed that either the absolute strategy or
the coordinated strategy saves more costs in Case I, II than in
Case III, IV. Compared with the wind generation under weak
wind in Case III and IV, the wind generation under strong
wind in Case I and II has higher uncertainties and induces
larger imbalance costs. Therefore, the potential of market cost
reduction by using control strategies is large in Case I and II.
Moreover, the cost savings brought by our strategy are 3 6
times higher than that of the absolute strategy. Fig. 7 shows the
cost difference for each hour of each case. It can be observed
that the cost saving brought by the absolute strategy has a sim-
ilar profile with the forecast wind generation shown in Fig. 3,
that is, the greater cost saving occurs during the hour of higher
wind power generation level. In contrast with this, the cost
ZHAO et al.: CONTROL AND BIDDING STRATEGY FOR VIRTUAL POWER PLANTS 569

TABLE I
O PTIMAL R ESULTS U NDER G REEDY (G), A BSOLUTE (A) AND
C OORDINATED (C) S TRATEGIES FOR THE F OUR C ASES (24 HOURS )
(N EGATIVE B IDS I NDICATE THE B IDS OF P RODUCTION . N EGATIVE C OSTS
I NDICATE THE I NCOMES F ROM THE M ARKET. D-M IS THE DAY-A HEAD
M ARKET. B-M IS THE BALANCING M ARKET.)

Fig. 7. Cost difference between Absolute strategy (A) /Coordinated strategy

Fig. 6. Cost differences between Absolute strategy (A) /Coordinated strategy (C) and Greedy strategy (G) for each hour.
(C) and Greedy strategy (G) for four cases.

saving brought by the coordinated strategy is affected by both

forecast wind generation and forecast demand levels.
The above observations can be explained by illustrating the
influence of generation and demand levels on the cost saving in
one hour, as shown in Fig. 8 and Fig. 9. The normalized stan-
dard deviations of wind generation and load, CVtW and CVtL ,
are fixed as 0.25 and 0.1. The cost savings are calculated from
the optimal costs of the used strategy under each combination of
generation and demand levels. As we can see in Fig. 8, the cost
saving of the absolute strategy almost totally depends on the
wind generation level. In the range of high demand level, the
cost savings are negligible, since the relatively large demand
uncertainty can not be handled by the absolute strategy. It can Fig. 8. Cost difference between Absolute strategy (A) and Greedy strategy
explain why the performance of absolute strategy in Case I is (G) vs. forecast demand and forecast wind generation for one hour (CVtW =
0.25, CVtL = 0.1).
worse than that in Case II. Fig. 9 shows that the cost saving
brought by coordinated strategy increases with both generation
level and demand level. The maximum cost saving occurs when a limit with the increase of generation level. That is because
the demand level is little larger than the generation level. In the the relatively small uncertainty of the low demand can offset a
demand range of [12, 20] of Fig. 9, the cost saving tends to limited amount of uncertainties from the generation side.
570
Fig. 9. Cost difference between Coordinated strategy (C) and Greedy strategy
(G) vs. forecast demand and forecast wind generation for one hour (CVtW =
0.25, CVtL = 0.1).
Comparing Fig. 8 and Fig. 9, it is clear that the performance
of coordinated strategy is much better than that of absolute
strategy in almost the entire space. Moreover, according to
Eq. (3) and (5), we can know that the smaller the demand uncer-
tainty is, the closer the coordinated and the absolute strategies
will be. Therefore, in the scenarios of low demand level and
high generation level, which appear in Case II t = 1 3, 14
16, the differences between the coordinated strategy and the
absolute strategy are relatively small. In other scenarios, our
strategy makes substantial improvements in reducing the VPPs
cost.
As the normalized standard deviations increase with the pre-
diction horizon, it is necessary to further analyze the effects
of CVtW and CVtL on the cost savings of these two strate-
gies. To give an example, Lt and Wt are fixed as 12 and 10,
respectively. The cost difference between the absolute strategy
and the greedy strategy for one hour is shown in Fig. 10. The
result for the coordinated strategy is shown in Fig. 11. Cost sav-
ings are calculated from the optimal costs of the used strategy.
Comparing these two figures, we can see that under each com-
bination of normalized standard deviations, the performance
of our strategy is much better than that of the absolute strat-
egy. Moreover, with the increase of prediction horizon, which
implies the increase of both CVtW and CVtL , the cost saving
of our strategy increases, while that of the absolute strategy
may decrease. It demonstrates that the coordinated strategy is
more capable of handling the large forecast errors due to a long
prediction time horizon.
C. Discussion
1) Compared With the Non-VPP Framework: To demon-
strate the advantage of VPP framework, we compare the costs
of VPP and non-VPP. In non-VPP framework, users and gen-
erators participate in the market as independent entities and
provide their own day-ahead bids separately. We simulate the
separately bidding in the above four typical cases. The optimal
bids of RDGs and users are obtained by Eq. (23), where the
CDF of power exchange is replaced by the CDF of wind gen-
eration and demand, respectively. Summing the optimal results
of 24 hours gives the optimal results for each case.
IEEE TRANSACTIONS ON SUSTAINABLE ENERGY, VOL. 7, NO. 2, APRIL 2016
Fig. 10. Cost difference between Absolute strategy (A) and Greedy strategy
(G) vs. normalized standard deviations of demand and wind generation forecast
errors for one hour (W t = 10, Lt = 12).
Fig. 11. Cost difference between Coordinated strategy (C) and Greedy strategy
(G) vs. normalized standard deviations of demand and wind generation forecast
errors for one hour (W t = 10, Lt = 12).
As shown in Table II, the bid of RDGs/Users simply depends
on the generation/demand situation and has no correlation with
the other. Compared with the results of VPP in Table I, the
summed day-ahead market cost of RDGs and users is lower,
but their summed balancing market cost is much higher. Fig. 12
shows the cost differences between the non-VPP and the VPP
bidding. It is clear that applying the framework of VPP reduce
the overall cost of RDGs and users for all cases, especially
for Case I where the reduction is as high as 1000$. Assuming
that these four typical cases appear with equal probability, we
present the expected 24-hour costs under non-VPP and VPP
frameworks in Table III. The results show that the expected cost
saving is as high as 8.77%. It demonstrates that coordinated
aggregation of DERs leads to economies of scale and lower
costs in the market, which is the value of VPP framework.
Moreover, we further analyze the influence of generation and
demand levels as well as forecasting uncertainties on the results.
Fig. 13 and Fig. 14 show that the cost saving increases with
both the forecasting uncertainties and the scales of generation
and load. This illustrates that for larger scales of intermittent
renewable generation and fluctuant load, the benefits from VPP
framework will be more significant.
ZHAO et al.: CONTROL AND BIDDING STRATEGY FOR VIRTUAL POWER PLANTS
TABLE II
O PTIMAL R ESULTS FOR S EPARATELY B IDDING IN N ON -VPP
F RAMEWORK (N EGATIVE B IDS I NDICATE THE B IDS OF P RODUCTION .
N EGATIVE C OSTS I NDICATE THE I NCOMES F ROM THE M ARKET. D-M
IS THE DAY-A HEAD M ARKET. B-M IS THE BALANCING M ARKET.)
Fig. 12. Cost differences between Non-VPP and VPP with Greedy/
Coordinated strategy for four cases.
TABLE III
E XPECTED C OSTS OF N ON -VPP AND VPP W ITH C OORDINATED
S TRATEGY (N EGATIVE C OSTS I NDICATE THE I NCOMES F ROM THE
M ARKET )
2) Relation With Storage: As storage technologies are
widely investigated in improving the renewable power inte-
gration, we numerically study the relation of our strategy and
storage in this part.
a) Comparison: Based on the greedy strategy of wind
power usage, a storage is used to correct the power deviation
in the balancing market. The energy efficiency of storage is set
to be 75%. The maximum charge/discharge rating of storage
is set to be the value of capacity per hour, which implies that
the storage can be charged to the maximum capacity or dis-
charged to empty in each hour. The VPPs market costs under
different storage capacities have been simulated in the above
four typical cases. The most significant difference between the
performance of our strategy and that of the storage appears in
571
Fig. 13. Cost difference between Non-VPP and VPP with coordinated strategy
vs. normalized standard deviations of demand and wind generation forecast
errors for one hour (W t = 10, Lt = 12).
Fig. 14. Cost difference between Non-VPP and VPP with coordinated strategy
vs. demand and wind generation levels for one hour (CVW
t = 0.25, CVt =
L
0.1).
Fig. 15. Cost vs. storage capacities for Case I.
Case I (strong wind and summer load), which is the most chal-
lenging case with large wind generation and demand forecast
errors. The result is plotted by the circle-line in Fig. 15. It can
be observed that the performance of our strategy is equivalent to
that of a storage with capacity 0.8MWh. According to the char-
acteristic parameters of present storage technologies [33], the
capital cost of a storage with 0.8MWh is higher than 320000$
(the unit capital cost is not less than 400$/KWh). It illustrates
that when a VPP does not have its own storage, our coordinated
strategy can substitute a certain capacity of storage and avoid
a high capital cost. Therefore, it is an effective alternative way
572
Fig. 16. Cost (including the average daily capital cost of storage) vs. storage
capacities for Case I.
for VPPs to reduce their cost in the market. Moreover, VPP
operators might like to allocate the investment cost of storage
into each operational day. When adding the daily capital cost of
storage to the above cost, the result is shown by the circle-line
of Fig. 16 (the lifetime of storage is set to be 10 years). It can
be seen that the VPPs cost firstly decreases and then increases
with the capacity, and the most effective capacity is 2WMh.
Since the cycling limitation and the maintenance cost of stor-
age are not included in the simulation, the result shown above
are the upper bound of storage performance.
b) Combination: On the basis of the coordinated strat-
egy, the storage is used to correct the remaining power deviation
in the balancing market. The setting of storage is the same as
above. As shown by the plus-line in Fig. 15, adding a storage
will further reduce the VPPs market cost, while the marginal
benefit of storage decreases with the increase of storage capac-
ity. When adding the daily capital cost of storage to this cost,
the result in shown by the plus-line in Fig. 16. We can observe
that installing a storage with capacity above 1.5MWh is uneco-
nomic, since the storage will cause more costs than benefits.
The most effective capacity is about 0.75WMh, which brings
an additional cost saving about 30$.
3) Relation With Elastic Load: Elastic load is another
option for handling the forecast uncertainties of renewable gen-
eration and load. A wide variety of elastic load technologies
have been proposed in existing literature. To give a general anal-
ysis, we consider that a given percentage of load is elastic and
can be directly controlled by the VPP operator. In the balancing
market, if the actual power consumption is larger than the bid
(i.e. power shortage) in one hour, the VPP operator will curtail
the elastic load of this hour to correct the deviation. According
to the related research [5], the elasticity of demand is small in
general cases. As considered in [18], the reasonable range of
elastic load percentage is set to be [0%, 5%]. The VPPs market
costs under different elastic load percentages have been simu-
lated for the four typical cases. Similarly, the comparison and
combination simulations are based on the greedy strategy and
the coordinated strategy, respectively.
a) Comparison: The most significant difference between
the performance of our strategy and that of elastic load appears
in Case II (strong wind and winter load), where the capacity
of elastic load is relatively small while the uncertainty of wind
IEEE TRANSACTIONS ON SUSTAINABLE ENERGY, VOL. 7, NO. 2, APRIL 2016
Fig. 17. Cost vs. elastic load percentage (capacity) for Case II.
generation is relatively large. The result is shown in Fig. 17,
where the horizontal axis presents the hourly elastic load per-
centage as well as the corresponding total capacity of elastic
load in 24 hours. We can observe that the coordinated strategy
achieves the same performance as the elastic load of 3.6MWh.
It should be noted that two additional costs caused by load man-
agements are not included in the simulation: the cost associated
with users loss due to demand curtailment; the installation cost
of necessary control devices in the demand side. This implies
that the actual saving brought by elastic load is less than the
results shown in the figure. For VPPs without or with very little
load elasticity, our coordinated strategy is a valuable alternative,
since it can effectively reduce the market cost as well as avoid
the additional costs caused by demand side managements.
b) Combination: Due to the limited adjustment capabil-
ity in the demand side, it is very beneficial to combine the
available elastic load with our strategy. As shown by compar-
ing the circle-line and the plus-line in Fig. 17, the extra saving
brought by the combination is larger than 100$. It demonstrates
that our strategy is a friendly and compatible approach, that is,
it can be combined with available flexible resources in VPP and
achieve better performance.
VI. C ONCLUSIONS
This paper develops a novel control and bidding strategy for
VPPs consisting of renewable power generators and inelastic
demand. The problem of minimizing the VPPs cost in both
the day-ahead market and the balancing market is formulated
as a bilevel stochastic optimization and solved by local search
algorithms. Compared with other two strategies, the proposed
strategy could achieve a much lower cost, and it is more capa-
ble of handling the situations with high forecast uncertainties in
both supply and demand sides. Moreover, our strategy can sub-
stitute a certain capacity of flexible resources and avoid their
additional capital costs. Furthermore, it can be combined with
other technologies to further improve the performance.
In the future work, the network operation aspects of TVPP
will be studied, based on the analyses of CVPP in the mar-
ket. It is also important to investigate the joint optimization
of our strategy and other technologies, such as storages, elas-
tic demand, fast-responding generators, the combined heat and
power, etc. The design of trading principles and contracts in
ZHAO et al.: CONTROL AND BIDDING STRATEGY FOR VIRTUAL POWER PLANTS 573

the VPPs internal market is another open area. It is critical to Theorem B.1: Assume that Lt follows Normal distribution.
define a reasonable pricing mechanism in the internal market in E(WtU ) is a monotonically increasing function of control deci-
order to fairly allocate the market revenues to DERs. sion t , if the probability distributions of Wt and Lt are
given.
A PPENDIX A Proof: In Lemma 1, let X, Y be Wt , t Lt respectively,
T HE E QUIVALENT F ORM OF O RIGINAL O BJECTIVE then Z will be corresponding to WtU . Denote the random
F UNCTION variable Lt by Y . 
Following the assumption that Lt obeys normal distribution
The objective function in the original optimization problem Y N (Y , (Y )2 ), we have Y N (Y , (Y )2 ), i.e.
can be given as:
 z t  z
Y
Et Q(t , Bt , t ) 1 2( Y
1 2 2
   FY (z, )= e Y
)2
dt= Y
es ds.
Y 2
= Q(t , Bt , t ) fst pt qt (st , pt , qt )dqt dpt dst
st pt qt
   
The theorem follows since
= [st E(Nt ) + st pt (x Bt )fNt (x)dx 
dE(Z) FY (z, )
st pt qt Bt = [FX (z) 1] dz > 0
 Bt
d 0
+ st qt (Bt x)fNt (x)dx]fst (st )fpt (pt )fqt (qt )
WI
where
dqt dpt dst FY (z, ) z ( 2Y
z
)2
 = e Y <0
= st [E(Nt ) + pt (x Bt )fNt (x)dx
22 Y
Bt
 Bt in z (0, ) and
+ qt (Bt x)fNt (x)dx],
WI [FX (z) 1] < 0.
(27)
thus the equivalent objective function is:
The theorem is also valid for other distributions types as
min min Et Q(t , Bt , t ) = min min Q (t , Bt ), (28)
t Bt t Bt long as they satisfy F
(x,)
< 0, which is a general property
where for many distribution types, such as Normal, Weibull, Gamma
 distributions. The proof for Gamma distribution is provided

Q (t , Bt ) = E(Nt ) + pt (x Bt )fNt (x)dx below.
Bt For Gamma distribution with parameters k and . We have
 Bt Y Gamma(kY , Y ), Y Gamma(kY , Y ). The CDF of
+ qt (Bt x)fNt (x)dx. (29) Y can be expressed as
WI

(kY , z/(Y ))
FY (z, ) = , z (0, +)
A PPENDIX B (kY )
P ROOF OF THE T HEOREM 4.1, 4.2 AND 4.3
then
Lemma B.1: Let
FY (z, ) zk
Z = min(X, Y ) = ez/(Y ) < 0.
(kY )k k+1 Y
where X, Y are two independent random variables. Then the
expectation of the random variable Z is given by Theorem B.2: Assume that Wt follows Normal distribution.

E(Z) = 0 [1 FX (z)][1 FY (z)]dz E(WtU ) is a monotonically decreasing function of CVW
t , if W t ,
0 Lt , CVL
[FX (z) + FY (z) FX (z) FY (z)]dz t , and t are given.
Proof: In Lemma 1, let X, Y be Wt , t Lt respectively,
where FX , FY are CDF of X and Y . then Z will be corresponding to WtU . 
Proof: Since the distribution of Z is Following the assumption that Wt obeys normal distribution
X N (X , (X )2 ), we have
FZ (z) = FX (z) + FY (z) FX (z) FY (z),
 zX

the expectation of Z can be given as 1 2X 2
FX (z) = es ds.
 0
E(Z) = 0 [1 FZ (z)]dz [FZ (z)]dz

= 0 [1 FX (z)][1 FY (z)]dz
0 
[FX (z) + FY (z) FX (z) FY (z)]dz. dE(Z) dE(Z) FX (z, X )
= X = X [FY (z)1]dz
 dCVX dX X
574 IEEE TRANSACTIONS ON SUSTAINABLE ENERGY, VOL. 7, NO. 2, APRIL 2016

where ACKNOWLEDGEMENT
FX (z, X ) z X z
( 2X )2 The authors would like to thank the anonymous reviewers
= 2
e X . and the editor for their comments which are extremely helpful
X 2X
for improving the quality of this paper.
The theorem follows since
 z
dE(Z) X ( 2X )2 R EFERENCES
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2012.
Ying Shen (S13) received the B.E. degree in
automation from XiDian University, Xian, China
in 2011. She is currently pursuing the Ph.D.
degree in automation at Tsinghua University, Beijing,
China. She was a Visiting Scholar at University of
California, Berkeley, CA, USA, in 2015. Her research
interests include renewable energy resources and
electricity markets.
Mingyang Li (S08M12) received the B.E. degree
in automation, and the Ph.D. degree in control sci-
ence and engineering, both from Tsinghua University,
Beijing, China, in 2006 and 2012, respectively. He
is currently a Lecturer with the School of Control
and Computer Engineering, North China Electric
Power University, and also works with the State Key
Laboratory of Alternate Electrical Power System with
Renewable Energy Sources, North China Electric
Power University. His research interests include mod-
eling and optimization of complex networked sys-
tems, power system scheduling and load flow security.

Qianchuan Zhao (M06SM08) received the B.E.

degree in automatic control, the B.S. degree in
applied mathematics, and the M.S. and Ph.D. degrees
in control theory and its applications from Tsinghua
University, Beijing, China, in 1992 and 1996, respec-
tively. He was a Visiting Scholar at Carnegie
Mellon University, Pittsburgh, PA, USA, and Harvard
University, Cambridge, MA, USA, in 2000 and 2002,
respectively. He was a Visiting Professor at Cornell
University, Ithaca, NY, USA, in 2006. He is cur-
rently a Professor and an Associate Director of the
Department of Automation, Center for Intelligent and Networked Systems,
Tsinghua University. He has authored over 80 research papers in peer-reviewed
journals and conferences. His research interests include control and optimiza-
tion of complex networked systems with applications in smart buildings, smart
grid, and manufacturing automation. He is an Associate Editor of the Journal
of Optimization Theory and Applications and the IEEE T RANSACTIONS ON
C ONTROL OF N ETWORK S YSTEMS. He was an Associate Editor of the IEEE
T RANSACTIONS ON AUTOMATION S CIENCE AND E NGINEERING. He serves
as the Chair of the Technical Committee on smart buildings of the IEEE
Robotics and Automation Society. He was the recipient of the China National
Nature Science Award for the project Optimization Theory and Optimization
for Discrete Event Dynamic System in 2009.