Electricity market clearing considering demand response cost of thermostatically controlled loads

•According to the analysis the equivalent energy storage (EES) model of the aggregated thermostatically controlled loads (TCLs), non-monotonic characteristics of the TCLs’ cost curve is discovered.•Due to the non-monotonic characteristics of the marginal cost, the proposed non-monotonic step-wise bidding model by the TCLs aggregators can reflect the actual cost when participating in power system scheduling.•Based on the bidding model, a novel electricity market clearing method considering TCLs is proposed, so that accurate market clearing can be guaranteed. Among various kinds of flexible loads resources in power system, the thermostatically controlled loads are considered as the excellent candidates for the demand response programs due to the heating/cooling storage characteristics. Market-orientated demand-side management has become a new focus, and the participation of the thermostatically controlled loads in the electricity market requires an accurate cost model. In this paper, a cost model is established based on the response characteristics of the thermostatically controlled loads in day-ahead scheduling, and considering the impact of non-monotonic bidding for thermostatically controlled loads on market clearing is considered, then the augmented constraints of the thermostatically controlled loads bidding are introduced into the traditional clearing method. By this way, proper sequence of bid quantity of each segment and the economic revenue can be guaranteed. The numeral testing results verify the effectiveness of the proposed method.