Constrained optimal bidding strategy in deregulated electricity market

Abstract

A precise and comprehensive model is designed for optimum power trading among a number of generating companies (GenCo) having thermal generating units. These GenCos are offering different bidding prices for gaining maximum profit. There may be different category of bidding situations. Possible bidding profile combinations along with some constraints are considered in case studies. The power balance constraint includes generation, demand and transmission loss, power generation limit, and fuel cost constraints. Thermal generating units are considered here. As scheduling is interconnected with bidding, economic power scheduling has been solved using Newton–Raphson method for standard IEEE 9 bus test system. Bidder’s profits and market price have been calculated in each case. For optimization of the power bidding problem, theory of dominance of game theory has been applied and justified for searching the Nash equilibrium.