Optimization of electricity spot market trading mechanism and peak-shaving compensation under high proportion of renewable energy integration

With the rapid development of renewable energy, especially wind and solar power, the integration of high proportions of these resources into the power grid presents both opportunities and challenges for the electricity market. This paper focuses on optimizing the electricity spot market trading mechanism and peak-shaving compensation in the context of high renewable energy penetration. The variability and intermittency of renewable energy generation necessitate the development of a robust market design that ensures system stability, economic efficiency, and fair compensation for flexible resources. We propose a comprehensive optimization framework that incorporates the dynamic balancing of renewable generation and load demand, with particular emphasis on peak-shaving compensation for conventional thermal power plants. By using a hybrid model that combines market-based mechanisms with technical constraints such as storage and demand response, we aim to enhance the integration of renewable energy while maintaining grid reliability and minimizing costs. The study also examines the role of peak-shaving in mitigating the intermittency of renewable generation, ensuring balanced grid operation. Through theoretical analysis and simulation results, this paper demonstrates how the proposed market mechanism can improve the efficiency of renewable energy integration, reduce operational costs, and provide fair incentives for peak-shaving services, offering valuable insights for policymakers and market participants in designing future electricity market structures that are both sustainable and economically viable under high renewable energy penetration.