Distributed Chemicals and Electricity Production with Regulated Energy Exchange

This paper explores the optimal operation of a distributed ammonia production facility which is coupled with local renewable energy generation. The coupling of stochastic renewables with this flexible chemical process enables exchange of energy with the utility in a highly regulated and benign manner. In particular, we analyze the ability of this facility to operate economically under a market structure which explicitly limits uncertainty and variability in energy exchanged with the macrogrid. A receding horizon control approach is formulated to optimally schedule local units and ensure that production targets and regulatory requirements are satisfied. The cost of regulating this energy exchange is shown to be minimal and the variability and uncertainty of energy exchange is shown to be significantly reduced. In addition, we show that a clear tradeoff emerges between the ability to sell excess power to the utility and the ability to meet previous power commitments when increasing renewables penetration.