Impact of equipment failures and wind correlation on generation expansion planning

• Published in: Electric power systems research Vol. 116; pp. 451 - 458
• Main Authors: Pineda, S., Morales, J.M., Ding, Y., Østergaard, J.
• Format: Journal Article
• Language: English
• Published: Amsterdam Elsevier B.V 01-11-2014; Elsevier
• Subjects: Applied sciences; Bilevel programming; Direct energy conversion and energy accumulation; Electric power plants; Electrical engineering. Electrical power engineering; Electrical power engineering; Energy; Equipment failures; Exact sciences and technology; Generation expansion; Market clearing; Miscellaneous; Natural energy; Operation. Load control. Reliability; Optimal location; Power networks and lines; Stochastic programming; Wind energy; Optimal location; Generation expansion; Bilevel programming; Equipment failures; Market clearing; Stochastic programming; Deregulation; Profitability; Power system economics; Optimization method; Power generation planning; Stochastic method; Failures; Bus system; Facility location; Wind energy; Electrical network; Power markets; Electric power production
• ISSN: 0378-7796; 1873-2046
• DOI: 10.1016/j.epsr.2014.07.019

•Current expansion models overlook some of the involved uncertainties.•We quantify the impact of failures and wind correlation on expansion decisions.•We use a bilevel model to determine optimal generation expansion decisions.•Uncertainty of failures and wind correlation is represented by a scenario set.•A 24-bus case study is used to drawn quantitative and qualitative conclusions.
Generation expansion planning has become a complex problem within a deregulated electricity market environment due to all the uncertainties affecting the profitability of a given investment. Current expansion models usually overlook some of these uncertainties in order to reduce the computational burden. In this paper, we raise a flag on the importance of both equipment failures (units and lines) and wind power correlation on generation expansion decisions. For this purpose, we use a bilevel stochastic optimization problem, which models the sequential and noncooperative game between the generating company (GENCO) and the system operator. The upper-level problem maximizes the GENCO's expected profit, while the lower-level problem simulates an hourly market-clearing procedure, through which LMPs are determined. The uncertainty pertaining to failures and wind power correlation is characterized by a scenario set, and its impact on generation expansion decisions is quantified and discussed for a 24-bus power system.