  The increasing challenges to the grid stability posed by the penetration of
renewable energy resources urge a more active role for demand response programs
as viable alternatives to a further expansion of peak power generators. This
work presents a methodology to exploit the demand flexibility of
energy-intensive industries under Demand-Side Management programs in the energy
and reserve markets. To this end, we propose a novel scheduling model for a
multi-stage multi-line process, which incorporates both the critical
manufacturing constraints and the technical requirements imposed by the market.
Using mixed integer programming approach, two optimization problems are
formulated to sequentially minimize the cost in a day-ahead energy market and
maximize the reserve provision when participating in the ancillary market. The
effectiveness of day-ahead scheduling model has been verified for the case of a
real metal casting plant in the Nordic market, where a significant reduction of
energy cost is obtained. Furthermore, the reserve provision is shown to be a
potential tool for capitalizing on the reserve market as a secondary revenue
stream.
