Values and impacts of incorporating local flexibility services in transmission expansion planning

This paper presents a cost-based TSO-DSO coordination model to quantify the value of local flexibility services and analyze its impact on the transmission grid expansion and the system operation. Flexibility is provided to the DC power flow transmission grid model by microgrids within the integrated AC power flow distribution grid model. The model's objective is to minimize the overall cost of transmission investments and procured flexibility and is achieved using a bilevel optimization approach where the power exchanges on all connected grid interfaces are controlled. Case studies using a combined test system of the IEEE RTS-96 transmission network interfacing multiple 33-bus distribution grids were performed to validate the model and assess the values and impacts of local flexibility on the transmission system expansion. The results showed that the proposed model modified the investment plan and dispatch of flexibility resources reducing the investment and operation cost of the transmission system.