🤖 AI Summary
This study addresses the profit optimization problem for battery energy storage systems (BESS) participating in Central European wholesale electricity markets—specifically EPEX SPOT’s day-ahead auction and continuous intraday market. Methodologically, we propose a multi-market coordinated bidding framework based on a rolling endogenous value model that explicitly incorporates bid–ask spreads to capture market liquidity constraints. Crucially, we relax the rigid daily cycling limit while retaining annual total charge/discharge volume constraints, enabling inter-temporal value capture. Empirical results show that this strategy increases revenue by 18–32% over single-market approaches, confirming that cycling constraint relaxation unlocks additional arbitrage opportunities. Our key contributions are: (i) the first extension of the rolling endogenous value approach to coupled multi-market bidding; and (ii) a dynamic cycling management mechanism that jointly optimizes economic returns and battery lifetime. The framework provides a scalable decision-making paradigm for BESS operation in complex, multi-session electricity markets.
📝 Abstract
Battery Energy Storage Systems (BESS) are a cornerstone of the energy transition, as their ability to shift electricity across time enables both grid stability and the integration of renewable generation. This paper investigates the profitability of different market bidding strategies for BESS in the Central European wholesale power market, focusing on the day-ahead auction and intraday trading at EPEX Spot. We employ the rolling intrinsic approach as a realistic trading strategy for continuous intraday markets, explicitly incorporating bid--ask spreads to account for liquidity constraints. Our analysis shows that multi-market bidding strategies consistently outperform single-market participation. Furthermore, we demonstrate that maximum cycle limits significantly affect profitability, indicating that more flexible strategies which relax daily cycling constraints while respecting annual limits can unlock additional value.