Brown Bag Seminar Series, July 27, 12:00, Emre Nadar, Bilkent University

Emre Nadar

Speaker: Emre Nadar, Bilkent University

Date & Time: July 27, 2022, Wednesday 12:00. Please feel free to bring your own lunch if you want.

Place: EA-409

Title: Integration of Pumped Hydro Energy Storage and Wind Energy

Generation: A Structural Analysis

Abstract: We study the energy generation and storage problem for a hybrid energy system that includes a wind farm and a pumped hydro energy storage (PHES) facility with two connected reservoirs fed by a natural inflow. The operator decides in real-time how much water to pump or release in the PHES facility, how much energy to generate in the wind farm, and how much energy to buy or sell. We model this problem as a Markov decision process under uncertainty in streamflow rate, wind speed, and electricity price. We prove the optimality of a state-dependent threshold policy under positive prices: The state space can be partitioned into several disjoint domains, each associated with a different action type, such that it is optimal to bring the water level of the upper reservoir to a different state-dependent target level in each domain. Once the optimal amount of water that should be pumped or released is found, we can immediately derive the optimal amount of wind energy that should be generated. The existence of natural inflow in the PHES facility – the major source of structural complexity – improves the profits by 19.9% on average in our data-calibrated instances with possibly negative prices. Leveraging our structural results, we develop a policy-approximation algorithm as a heuristic solution method for such realistic instances. This algorithm yields near-optimal solutions up to

23 times faster than the standard dynamic programming algorithm. It also significantly outperforms profit-approximation and rolling-horizon approaches adapted from the literature with respect to objective value.

Bio: Emre Nadar is an assistant professor in the Department of Industrial Engineering at Bilkent University. He holds a Ph.D. degree in Operations Management from Carnegie Mellon University and a B.S. degree in Industrial Engineering from Bilkent University. His research focuses on supply chain management and sustainable operations. He studies problems such as managing inventories in multi-item supply chains, controlling new-product diffusion in closed-loop supply chains, and managing renewable resources in energy supply chains. Dr. Nadar employs the theory of Markov decision processes to model and analyze such problems.

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