An environmental/techno-economic approach for bidding strategy in security-constrained electricity markets by a bi-level harmony search algorithm

Mojtaba Shivaie and Mohammad T. Ameli

Renewable Energy, 2015, vol. 83, issue C, 881-896

Abstract: In this paper, a new approach is presented for developing optimal double-sided bidding strategy in security-constrained electricity markets by considering emission of pollutants, as further objectives. In the proposed methodology, both Generation Companies (GenCos) and Distribution Companies (DisCos) try to maximize their profit by implementation of optimal strategies, whiles they have incomplete information about their rivals and market mechanism of payment is locational marginal pricing. In addition, each participant provides its strategic bids based on supply function equilibrium model and it modifies its bidding strategies until Nash equilibrium points are computed. The proposed approach is modeled as a bi-level optimization problem with the upper sub problem addressing individual GenCos and DisCos and the lower sub problem addressing the Independent System Operator (ISO). The upper level maximizes the individual market participant's profit and the lower one solves the ISO's market clearing problem for maximizing Community Welfare Function (CWF). A Self-adaptive Global-based Harmony Search Algorithm (SGHSA) is used to obtain optimal bidding strategies. The proposed methodology has been implemented on the 6-machine 8-bus system test system to demonstrate the feasibility and effectiveness of the proposed approach. Simulation results illustrate the profitableness of the newly developed approach in the obtaining optimal bidding strategies.

Keywords: Community Welfare Function (CWF); Distribution Companies (DisCos); Double-sided bidding strategy; Generation Companies (GenCos); Nash equilibrium; Self-adaptive Global-based Harmony Search Algorithm (SGHSA) (search for similar items in EconPapers)
Date: 2015
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Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:renene:v:83:y:2015:i:c:p:881-896

DOI: 10.1016/j.renene.2015.05.024

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