IDSO-Managed Bid-Based Transactive Design for DER Participation in Wholesale Markets While Preserving T–D Interactions

Participation of Distributed Energy Resources (DERs) in bid-based Transactive Energy Systems (TES) at the distribution systems facilitates strongly coupled, bidirectional interactions between Transmission-Distribution (T-D) systems. Capturing these interactions is critical for ensuring seamless integration within an Integrated Transmission and Distribution (ITD) framework. This study proposes a methodology to preserve such tight T-D linkages by developing an Independent Distribution System Operator (IDSO) managed bid-based TES design for unbalanced distribution systems. The proposed design operates within the ITD paradigm and permits DER participation in the Wholesale Power Market (WPM) through IDSO while preserving tight T-D linkages. To this end, this research offers the following key contributions: a novel bid/offer prequalification-cum-aggregation method to ensure a grid-safe and value-based aggregation of DERs' bids and offers for WPM participation through IDSO; and a retail pricing mechanism that reflects the true value of procuring or offering additional units of power within the distribution system. Case studies are conducted on a modified IEEE 123-bus radial feeder populated with a high DER concentration to validate the proposed frameworks' effectiveness in coordinating the DERs efficiently and reliably.