Wind offering strategy in the Australian National Electricity Market: A two-step plan considering demand response

•This paper proposes a two-step offering strategy for wind power producers.•A wind producer can trade DR with DR aggregators in order to lessen its risk.•To this end, various DR contracts are formulated.•The proposed plan is evaluated on the Australian National Electricity Market.•The outcomes indicate the validity of the given wind offering strategy.

This paper proposes an energy offering strategy for wind power producers. A new trading plan is presented through which a wind power producer can employ demand response (DR) to maximize its profit. To consider DR, a new DR scheme is developed here. The proposed plan includes two steps: The first step takes place on a day-ahead basis. The corresponding decisions involve an initial offering schedule and preliminary DR arrangements for the following day. The second step coincides with the day of the energy delivery. A consecutive approach is proposed in which the wind power producer determines its final energy offer during each trading interval. Simultaneously, the required DR agreements for that interval are also confirmed. This approach is repeated until all periods of the day are covered. The proposed plan is formulated as a stochastic programming approach, where its feasibility is evaluated on a case of the Australian National Electricity Market (NEM).