Distribution System Expansion Planning Considering Non-Utility-Owned DG and an Independent Distribution System Operator

This paper addresses the multistage or dynamic investment decision-making problem arising in a distribution system within a transactive energy environment. Under such a framework, three agents are involved, namely the distribution company (DISCO), the owner of distributed generation (DG) units (DGENCO), and the independent distribution system operator (IDSO). Here, we propose characterizing this planning problem as an instance of trilevel programming. In the upper level, the DISCO identifies the optimal investment plan in network assets and the best potential locations for DG in order to supply the customer demand at maximum profit. In the middle level, the DGENCO determines the best location, sizing, and timing for DG installation so that the corresponding profit is maximized. Finally, in the lower level, the IDSO is responsible for the optimal operation of the expanded distribution system. The resulting mixed-integer trilevel program is solved by a novel approach relying on Benders decomposition. The performance of the proposed approach has been illustrated with a case study based on a 37-node test system.