© 2004 by Institute of Mathematics and its Applications
Optimization techniques for Available Transfer Capability (ATC) and market calculations
1 Department of Electrical Engineering, University of Washington, Seattle WA 98195, USA, 2 Department of Industrial Engineering, University of Washington, Seattle WA 98195, USA, 3 Department of Economics, University of Washington, Seattle WA 98195, USA
The recent movement towards an open, competitive market environment introduced new optimization problems such as market clearing mechanism, bidding decision and Available Transfer Capability (ATC) calculation. These optimization problems are characterized by the complexity of power systems and the uncertainties in the electricity market. Accurate evaluation of the transfer capability of a transmission system is required to maximize the utilization of the existing transmission systems in a competitive market environment. The transfer capability of the transmission networks can be limited by various system constraints such as thermal, voltage and stability limits. The ability to incorporate such limits into the optimization problem is a challenge in the ATC calculation from an engineering point of view. In the competitive market environment, a power supplier needs to find an optimal strategy that maximizes its own profits under various uncertainties such as electricity prices and load. On the other hand, an efficient market clearing mechanism is needed to increase the social welfare, i.e. the sum of the consumers’ and producers’ surplus. The need to maximize the social welfare subject to system operational constraints is also a major challenge from a societal point of view. This paper presents new optimization techniques motivated by the competitive electricity market environment. Numerical simulation results are presented to demonstrate the performance of the proposed optimization techniques.
Keywords: Markov decision process; market optimization; improving hit-and-run; power system economics; available transfer capability