Journal
INTERNATIONAL JOURNAL OF ELECTRICAL POWER & ENERGY SYSTEMS
Volume 155, Issue -, Pages -Publisher
ELSEVIER SCI LTD
DOI: 10.1016/j.ijepes.2023.109664
Keywords
Bilevel optimization; Distributed energy resources; Distribution system operators; Energy pricing; Wholesale day-ahead market
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This paper proposes a new bilevel mathematical model for competitive electricity markets, taking into account the participation of distribution systems operators. A new pricing method is introduced as an alternative to the inaccessible dual variables of the transmission system.
The electricity market liberalization propelled by the increased operational flexibility observed in distribution systems urges the development of mathematical models for competitive electricity markets accounting for the participation of distribution systems operators. Most existing approaches model the interaction between the agents and the market as a bilevel programming problem, wherein the market is characterized at the lower level. Hence, the upper-level agent's objective function is favored over minimizing the costs of supplying the system's demand. In this paper, a new bilevel formulation is proposed. In the upper level, the market operator determines the optimal energy price that ensures the demand supply and maximizes the overall social welfare. In the lower level, the generation companies and distribution systems operators determine the amount of energy injected/extracted into/from the transmission system to maximize profits/minimize operational costs. A new pricing method is proposed in this paper as an alternative to the transmission system's dual variables, which are inaccessible under the proposed framework. The resulting nonlinear mixed-integer bilevel programming formulation is transformed into an equivalent single-level mixed-integer linear program. Numerical results illustrate the proposed approach's effectiveness in maintaining the minimum operational costs while distributing the payoff amongst the agents.
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