Optimal regulation provision by aluminum smelters

The industrial electrolysis process which is used to produce aluminum is a highly energy-intensive process. As it is possible to adjust the power consumption of this process on short notice without significantly affecting the quality of the aluminum, aluminum smelting plants are able to provide regulation to the electric power grid. In this paper, we focus on determining the optimal regulation capacity that such a manufacturing plant should provide to maximize the combined profit from producing aluminum and providing regulation. The approach is based on stochastic optimization and the stochastic variable is the regulation signal sent to the smelter. Using linear approximations of the high-resolution regulation signal as scenarios, we can reduce the computational burden to solve the associated optimization problem significantly. Simulations for a specific aluminum smelting plant provide insights into the optimal regulation provision by smelters with various cost and price parameters.